Brendan Griffin (Kerry South, Fine Gael)
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85. To ask the Minister for Public Expenditure and Reform if his attention has been drawn to the fact that contractors are tendering for public jobs below cost; if he is concerned that this is leading to some businesses failing; his plans to tackle this practice to protect employment; and if he will make a statement on the matter. [20729/14]

Brendan Howlin (Wexford, Labour)
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It is widely acknowledged that the construction industry has seen the greatest decline in activity and with it the highest rise in unemployment of all sectors in the economy.  The collapse in construction output from the high and unsustainable levels of around €34bn in 2006 to around €8.8bn in 2013 has been accompanied by intense competition resulting in a reduction of tender prices across the construction sector. The procurement of public contracts should be conducted in an open, objective and transparent manner and the principles of all EU and national public procurement rules should be adhered to.

The management of the tendering process for a public contract is a matter for each contracting authority.  It is the responsibility of each contracting authority to ensure that tenderers comply with all the requirements of the process.  A tender which might be regarded as abnormally low or below cost may not be rejected without investigation and consideration of the relevant elements that gave rise to a particularly low bid.  Such elements might include an innovative technical solution or exceptionally favourable conditions available to the tenderer.  The tenderer must be given the opportunity to explain the basis of the tender.  Under Article 55 of 2004/18/EC, the EU Directive governing public procurement, contracting authorities are obliged to consider the constituent elements of a tender before it may reject a tender on the basis that it is abnormally low.  Having carried out an investigation on the constituent elements of the tender, should it consider the tender to be abnormally low, the contracting authority may reject the tender but is not obliged to.

In relation to the awarding of specific contracts these are matters for the relevant contracting authorities concerned.