Billy Timmins (Wicklow, Independent)
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103. To ask the Minister for Public Expenditure and Reform the amount of money which has been spent by this Government since 2011 to ensure that suppliers who, through outsourcing or by other means, are dependent on offshore suppliers to win contracts meet all requisite ethical standards for contracts awarded through the public procurement process; and if he will make a statement on the matter. [24098/15]

Brendan Howlin (Wexford, Labour)
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The main purpose of the EU public procurement regime is to open up the market and to ensure the free movement of supplies, services and works within the EU having regard to Treaty of Rome principles including transparency, proportionality and equal treatment. This is the rationale that shapes the detailed rules (Directives) governing the regime.

Public procurement procedures require applicants to meet certain standards when applying for public contracts. The criteria upon which contracting authorities may exclude applicants from the award procedure of public contracts are set out in Regulation 53 of SI 329 of 2006 European Communities (Award of Public Contracts) Regulations and Article 45 and Recitals (34) and (43) of 2004/18/EC, the EU Directive on the co-ordination of procedures for the award of public works contracts, public supply contracts and public service contracts. Before an applicant, in relation to certain breaches, is excluded the applicant may make a case and provide supporting evidence as to why it should not be excluded. The contracting authority must consider this evidence before deciding whether to exclude or include an applicant.

In qualifying for inclusion in tender competitions for public contracts, applicants must submit signed declarations stating that none of the circumstances outlined in Regulation 53 of SI 329 or Article 45 of 2004/18/EC apply. 

Under the current regime and standard forms of contract, there are requirements in place for compliance with legal obligations. For example Clause 2 of the standard form of the public works contracts requires the contractor, his personnel and sub-contractors to comply with all legal requirements. 

There is a substantial body of legislation that directly or indirectly governs construction activities, however two key pieces of industry specific legislation; the Safety, Health and Welfare at Work (Construction) Regulations 2013 and the Building Control Regulations 1997 2014 both place considerable responsibility, not only on contractors, but on all those involved in construction projects including designers, supervisors and individual workers. 

The ultimate sanction for serious breach of health and safety regulations is a criminal conviction and imprisonment. Compliance with health and safety regulations is separately assessed in a pre-qualification of a works contractor with supporting evidence required to demonstrate the applicant possesses sufficient resources and is competent to carry out the proposed works. The Works Requirements which are a key part of the contract documents also set out detailed specifications on how regulatory standards are to be met. 

Contractors are required to submit on-going certification under Clause 5.3 (Pay and Conditions of Employment) of the contract that they have complied in full with the requirements of that clause which covers aspects such as compliance with employment law, and deductions for social welfare. Contractors are also required under this Clause to maintain records and timesheets in respect of all those engaged on the works. 

The new EU rules comprise a suite of three Directives (Public Procurement, Utilities and Concessions) that repeal the existing rules governing the conduct of procurement across the EU but the basic architecture of EU procurement will remain intact. The changes in the new regime were agreed principally to streamline the public procurement process and to put in place more simplified and flexible rules to reduce red tape and to make the procurement process more efficient.

The Office of Government Procurement (OGP) is currently exploring policy choices as part of the transposition process. One of the policy areas highlighted in the consultation document is adherence to "applicable obligations" in labour law. Each Member States has the choice on which appropriate measures to adopt to ensure compliance with this obligation as well as choices on the level of oversight down the subcontracting supply chain. The OGP is currently exploring the appropriate measures to adopt and have sought views on this choice as part of the consultation process. Clearly, a key objective in transposing these new provisions is to avoid imposing disproportionate administrative burden on contracting authorities and tenderers while at the same time adhering to applicable labour law obligations. Getting the balance right will help to ensure value for money outcomes from procurement for the economy as a whole.