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'Leaving Cert papers shouldn't be published in France': PAC probing Ireland's 'lazy' approach in awarding State contracts

The PAC is to look at issues of non-compliance with procurement rules for all State bodies.

Image: Sam Boal/Photocall Ireland

THE DÁIL’S PUBLIC Accounts committee plans to investigate further how the state awards contacts after repeated breaches of guidelines came to light. 

TheJournal.ie recently reported how millions of Euro has been spent outside of official guidelines on services procured by government in recent years.

Under guidelines set out by the Office of Government Procurement (OGP), government departments and state bodies are required to inform the Comptroller and Auditor General when services worth over €25,000 are procured without a competitive process.

The guidelines exist to ensure that the €8.5 billion spent by the State on goods and services every year achieves value for money and a sustainable delivery of services.

Such contracts are usually awarded after a competitive tender process, however on hundreds of occasions since 2017, this did not happen. 

Breakdown 

As reported by this website last week, responses to a number of Parliamentary Questions in the Dáil over several months this year reveal how state bodies and government departments have paid millions to private firms for services obtained outside public procurement guidelines.

The responses, received by Independent TD Mattie McGrath, reveal the extent to which services have been procured outside the guidelines between 2017 and 2019.

According to responses received by McGrath, all but one government department – the Department of Defence – procured at least one service outside the guidelines set out by the OGP.

In the three years covered, services procured outside of a formal tendering process included: 

  • Advice to the Department of Communications, Climate Action and Change about the National Broadband Plan at a cost of €14.6m;
  • Work by the Expert Technical Group on the former Mother and Baby Home in Tuam, at a cost of €123,000;
  • Translation services for the Department of Finance relating to the ‘Apple state aid’ case, at a cost of €28,000;
  • The provision of health insurance for overseas staff at the Department of Foreign Affairs and Trade, at a cost of €1.5m;
  • Catering services at the Irish consulate in New York, which cost €124,000;
  • The provision of security to a number of foreign embassies, costing €574,000;
  • The supply of newspapers to the Department of An Taoiseach for €56,000
  • An “urgent” requirement for printing at the Department of Employment Affairs and Social Protection, which cost €262,000.

Of the 16 ministers whose departments awarded contracts outside of OGP guidelines, ten told McGrath which services they provided and at what cost.

Further details were provided by some departments contacted by TheJournal.ie, although many departments did not disclose which companies were contracted to carry out certain services outside OGP guidelines.

Just four ministers named the companies or individuals who were awarded contracts by their department, although most described the services which were provided.

Probe

The PAC is carrying out an exercise in respect of non-compliance with procurement rules for all State bodies. Throughout the year, a number of departments and agencies have appeared in hearings in relation to their yearly accounts, with issues of non-compliance with procurement frequently arising. 

Chairman of the committee, Fianna Fáil TD Sean Fleming, said there have been cases in the past that have resulted in Irish businesses losing out. 

“It is a balancing issue. From looking at this issue previously I am aware that Ireland, which is the only island economy in the EU, ends up placing more of its contracts outside the State than other EU countries do. In France 98% or 99% of all contracts given out by public bodies go to French companies. It is the same in Germany, Spain and Italy,” he said. 

“Ireland, however, is taking a lazy approach that we just adopted. We all remember the situation some years ago when every Leaving Certificate exam paper was published in France. They just made the contract so big that a French company got it. The French would never do that. It could have been broken down by subject and made into ten contracts and perhaps ten, six, two or three Irish companies could have bid. It is about how the contract is constructed.”

The PAC has compiled a list of government departments, agencies and other bodies who have flouted procurement guidelines in the past. The committee plans to ask the State’s Chief Procurement Officer to attend a hearing in the new year as its probe of the matter continues. 

The C&AG Seamus McCarthy said last week that there may be better ways to set up the procurement process so that there is “true competition” and to ensure there’s no bar to small and medium enterprises competing.

Speaking at the PAC on Thursday he said it was important that everybody has an opportunity to compete. 

Committee member, Sinn Féin’s David Cullinane told TheJournal.ie that the PAC is interested in looking at what is and is not working in the procurement process. 

From the data examined by the committee, he said it appeared breaches of guidelines often arose when government departments or agencies were under time pressure to secure required services. He said a balance needed to be struck, and questioned whether the current system may be too cumbersome to navigate.

“There are two issues at play here. First, the rules themselves may not be fit for purpose. That is one of the issues that we may need to consider. The rules may need to be changed. That is not for us to do but it might be the outcome of our work,” he said. 

Irish businesses

Independent TD Catherine Connolly said the State procurement process should be competitive “but still of benefit to the local community”. 

“The system obviously is not working and I believe we need to be looking at that. It cannot be working if every second or third organisation and big department comes back time and again with non-compliance. Some of it is bad management and we cannot let them off the hook on that one. Some of it is just that they are not complying with fair rules.”

Said Cullinane: “If there is no level playing field, however, or if it is too rigid, too complex or too difficult – or whatever the problems might be in some areas – then we have a responsibility to find that out.”

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