Written answers

Tuesday, 24 June 2014

Department of Public Expenditure and Reform

Public Procurement Regulations

Photo of Tommy BroughanTommy Broughan (Dublin North East, Independent)
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234. To ask the Minister for Public Expenditure and Reform the level of monitoring being carried out by the Office of Government Procurement in order to determine whether the guidelines in Circular 10/14: initiatives to assist small and medium enterprises in public procurement, are being followed by Departments and local government; and if his Department will be undertaking periodic progress reports to determine if the new circular is having an appreciable effect on the number of public contracts awarded to SMEs. [26720/14]

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Government is committed to ensuring that SMEs are fully engaged with public sector procurement and the opportunities presenting. The purpose of the new guidelines and procedures in Circular 10/14 are to ensure that engaging with government procurement is easy and low cost.  The initiatives announced will open up opportunities for small businesses to bid for State business and simplify and streamline the public procurement process.  They will reduce the administrative burden on businesses that want to tender for public contracts. The new Circular has been broadly welcomed by industry representative associations.

The Circular applies to all public sector bodies, such as Government Departments/Offices, local and regional authorities, the health and education sectors and non-commercial State bodies. It also applies to works and related services contracts awarded by a private entity, which are subsidised 50% or more by a public body, are covered by the EU Directives if they exceed the EU thresholds. Contracts below the EU thresholds which are funded or part-funded from public funds, awarded by private sector entities, should, as far as possible, be awarded in accordance with the national procurement guidelines.

In conjunction with the Department of Jobs, Enterprise and Innovation, the Office of Government Procurement has set up a high level group on SME access to Public Procurement.  The focus of this group is to develop and monitor strategies for SME access to public procurement.  The group also has regard to the Government's Action Plan for Jobs and specifically those actions aimed at maximising procurement opportunities for SME in the public sector.  In addition the Office of Government Procurement, through its new governance model, including its procurement executive, will be monitoring any issues that arise from the implementation of Circular 10/14.  Finally, design changes are currently being made to the eTenders national portal to capture data relating to procurement, and, in particular, data relating to contracts awarded over €25,000.  It is expected that these changes will facilitate better monitoring and reporting on public procurement trends on a broad range of fronts going forward.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Independent)
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235. To ask the Minister for Public Expenditure and Reform if his Department is being provided with figures from Departments and local government to indicate the number of public contracts split into lots as recommended for some contracts under Circular 10/14: initiatives to assist small and medium enterprises in public procurement, so as to enable SMEs to compete for contracts. [26722/14]

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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As the Deputy is aware, my Department has recently finished reviewing and updating existing guidelines and procedures aimed at promoting SME participation in public procurement.  Circular 10/14, launched on 17 April, sets out new initiatives aimed at opening up opportunities for small businesses to bid for State business. Amongst the measures announced, the new guidance encourages buyers to break large contracts down into lots where it is reasonable to do so to maximise participation by SMEs competing for smaller elements of these larger contracts.  This should be done in a way that does not compromise efficiency or value for money or impose any undue risks on the State.

It should be pointed out that a number of the categories of goods and services may be better suited to single supplier national arrangements. However the greater use, where appropriate, of multi-supplier frameworks can address local supplier issues while also ensuring on-going cost competitiveness of the framework itself.  Such multi-supplier frameworks may offer SMEs the opportunity to participate in national level contracts, thereby offering valuable reference work when competing for public procurement contracts in other jurisdictions.

Data on the splitting of tenders into lots which has been taken from the Government eTenders portal indicates that 587 tenders above the EU threshold were published between 1 January 2014 and 19 June 2014.  Of these tenders, 150 were split into lots (26%).  Since the publication of Circular 10/2014 on 17 April 2014, 243 tenders have been published of which 71 were split into lots (29%).

The reform of procurement across the public service is a key element of the public service reform programme.  Public procurement savings enable public service organisations to deliver much-needed services from the tighter budgets within which they are now required to operate. Reforms are being carried out in a manner that recognises the clear importance of small and medium-sized enterprises in this country's economic recovery. The Office of Government Procurement will continue to work with industry to ensure that winning government business is done in a fair, transparent and accessible way and to ensure that Government procurement policies are business friendly.

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