Michael Healy-Rae (Kerry South, Independent)
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To ask the Minister for Public Expenditure and Reform his views on correspondence (details supplied) regarding the centralised buying of goods; and if he will make a statement on the matter. [1266/13]

Brendan Howlin (Wexford, Labour)
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The Public Service Reform Plan published my Department in November 2011 identified procurement reform as a key instrument that can assist in maintaining the delivery of public services in an efficient manner.

The National Procurement Service (NPS) has put in place a number of national arrangements designed to secure better value for money from leveraging the public service’s buying power in relation to a range of goods and services that are commonly purchased across the public service. These national arrangements have benefits that include: cash savings; administrative savings from reduced duplication of tendering; greater purchasing expertise; improved consistency; and enhanced service levels. In order to increase the usage of the NPS arrangements and thereby secure best value for money, the Government decided that it should be mandatory for public service bodies to use specified national procurement arrangements. The categories subject to national procurement arrangements include: electricity; natural gas; stationery and office supplies; paper; ICT consumables; managed print services; print media advertising; and, motor vehicles. These national arrangements will secure best value for money and facilitate contracting authorities to maintain the delivery of services in the context of tighter budgetary constraints.

While the key reasons for reforming public purchasing is to enable the State to do more with less by aggregating procurement to secure better value for money, it is worth noting that such aggregation arrangements can be implemented in a manner that achieves value for money with a minimal negative impact, or indeed a positive impact, on SMEs. While a number of the categories of goods and services mandated national arrangements are suited to single supplier it should not be taken that single supplier frameworks are to be accepted as the norm. The greater use where appropriate of multi-supplier frameworks – for example the supply of managed print services- can address local supplier issues while also ensuring ongoing cost competitiveness of the framework itself. Such multi-supplier frameworks can also offer SMEs the opportunity to participate in national level contracts, thereby offering valuable reference work when competing for public procurement contracts in other jurisdictions.

In order to encourage greater SME participation the NPS over the past 3 years has conducted a targeted programme of education for suppliers who wish to learn more about doing business with the Irish Public Service. This programme consists of seminars, workshops and large scale 'meet the buyer' events hosted nationwide. In 2012 the NPS, working with InterTradeIreland, for the first time brought together a number of the lead Government agencies to create a programme of major events for the Island of Ireland. Attendees could also avail of educational seminars on a variety of topics ranging from the technicalities of public service procurement to procedures around consortia-building for SMEs. To date the NPS has facilitated workshops and presented at seminars to over 3,000 SMEs nationwide. Surveys conducted at these events have indicated a high degree of satisfaction among suppliers. Parallel with these events the NPS also works closely with business representative bodies such as ISME and IBEC to provide briefings for their members.

James Bannon (Longford-Westmeath, Fine Gael)
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To ask the Minister for Public Expenditure and Reform his plans to change the procurement legislation which prohibits smaller construction companies from tendering for projects in view of the fact that the criteria for tendering for the majority of contracts are based on each company's previous year's turnover; and if he will make a statement on the matter. [1468/13]

Brendan Howlin (Wexford, Labour)
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The assessment of a tenderer’s financial and economic standing is a key part of any procurement process because tenderers must have the necessary capacity to carry out a contract. Establishing the appropriate suitability criteria that are relevant and appropriate to a particular contract is, of course, a matter for the contracting authority concerned. This is because the contracting authority is in the best position to gauge the appropriate levels of financial capacity that are appropriate to the needs of that specific contract. My Department has developed specific national guidelines for contracting authorities in relation to minimum standards for suitability criteria for construction contractors interested in tendering for public works projects, published as part of the Capital Works Management Framework, which is available at www.constructionprocurement.gov.ie. In this regard, it is important to point out that there are no centrally imposed requirements for a minimum turnover. Such requirements would logically be developed on a case by case basis with reference to the specific needs of the contract.

The Government recognises that the small and medium enterprise (SME) sector is very important to the economy and that public procurement can be a source of business for SMEs. In this regard, my Department has issued public procurement guidelines (Circular 10/10) to public bodies which are aimed at facilitating greater participation of SMEs in public procurement opportunities. In relation to suitability criteria, the guidelines stress that public bodies must ensure that any criteria/turnover levels set by them must be both justifiable and proportionate to the needs of the contract.