IRELAND’S SMALL BUSINESSES are being locked out of lucrative government tenders as the push to drive down prices sends millions in big contracts offshore.
The Small Firms Association (SFA) claims the attitude is costing Irish jobs as local operators are left unable to compete with overseas buying power.
SFA director Patricia Callan said a move to cut tender costs through large-scale contracts left out the many small businesses lacking the skills to band together for joint bids.
In its pursuit of the cheapest price, the government is neglecting the fact that this will not deliver either the quality, cost in use savings or service levels it desires, but will result in lost jobs here at home,” she said.
While the SFA says the government’s policy to save money was “valid”, it should be pulled into step with its plans to support jobs and enterprise.
Where have all the tenders gone?
TenderScout, a company which helps small and medium enterprises (SMEs) win public contracts, claims foreign companies won 28% of all Irish public contracts last year.
In its annual report, the company said firms from the UK and Ireland were taking the biggest share, although French, Belgian and German companies were all enjoying the spoils.
Big firms like Eircom, UPC and PwC were also taking a disproportionate share of the tenders on offer, the report said.
Public Expenditure Minister Brendan Howlin recently put the share of public contract money going overseas at under 5% of the total.
Callan said large foreign suppliers could use their buying power to compete on price and a new procurement system needed to be set up based on a “think small first” attitude.
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