Seán Fleming (Laois-Offaly, Fianna Fail)
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26. To ask the Minister for Public Expenditure and Reform his views that the number of State contracts that are awarded to companies outside the State is above the European average; the way this can be addressed; and if he will make a statement on the matter. [38162/14]

Brendan Howlin (Wexford, Labour)
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Under EU and national rules, the public procurement of works, supplies and service contracts above certain thresholds must be awarded on the basis of objective and non-restrictive criteria. The aim of these European rules is to promote an open, competitive and non-discriminatory public procurement regime which delivers best value for money. It would be a breach of the rules for a public body to favour or discriminate against particular bidders on grounds of nationality and there are legal remedies which may be used against any public body infringing these rules.

The Office of Government Procurement produces statistical information in relation to above-EU threshold procurement activity by the Irish public sector and for providing these statistics to the European Commission. The EU average for cross-border activity in relation to activity above these thresholds is 1.4%. The following is based on data available on above EU threshold awards.

In 2011, the value of contracts that were awarded above this threshold to non-domestic companies was €240 million.  This represents less than 5% of the overall 2011 annual public procurement spend (approximately €13.1 billion). I am advised by the Office of Government Procurement that more up to date data on above EU threshold contracts for 2012 and 2013 will be available shortly.

The reasons for this level of cross-border procurement would include:

- a significant number of procurement categories are not supplied locally (i.e. fuel, vehicles, aircraft, heavy machinery and certain pharmaceuticals); and,

- that the vast majority of public procurement opportunities in Ireland are advertised in English which makes our tender documents accessible to businesses across Europe, for whom English is the preferred second language;

The reform of public procurement across the public service is on-going and will continue to provide opportunities to the SME sector to win business.  My Department continues to introduce changes to assist SME's in competing for government contracts. In April 2014, I introduced Circular 10/14 which provided guidance to contracting authorities on measures to reduce barriers for SME's in tendering for public contracts. In addition, the Office of Government Procurement continues to engage with industry bodies through the SME Working Group to identify issues in public procurement and implement solutions. 

The public procurement market in the EU is estimated to be valued in excess of €2.4 trillion. It is important to remember that open tendering is a two way street and that it provides Irish companies with opportunities to compete abroad and reliable EU studies indicate that many Irish businesses are successful in this regard.