Responding to the launch by Minister Brian Hayes, TD of “Circular 10/14: Initiatives to assist SMEs in Public Procurement, the Director of the Small Firms Association, Patricia Callan, has stated that “this new guidance document, whilst welcome simply does not go far enough to ensure SMEs get their fair share of government contracts”.
Specifically she noted that “there are no targets set for SME procurement, as in other jurisdictions; there is no mandatory obligation to give feedback to those companies who have tendered in order to help them learn and be successful in future tendering opportunities and that the provisions around sub-dividing a contract into lots means that practically it is easier for procurers to opt out than in.”
At the press briefing, Callan reiterated the SFA’s position to the Minister that “small businesses around the country are effectively being prohibited from tendering for public contracts, in the move to centralise government procurement into large-scale contracts that they are ineligible to apply for.”
“In its pursuit of “the price is right” (Minister Hayes quote), 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. Centralised large aggregated contracts make it increasingly more difficult for small innovative companies to compete and this means a serious potential loss of business. There are difficulties in small firms collaborating to make joint tender bids as they may fall fowl of Competition Law and do not have the skills necessary to do this at present. The Government should delay the roll-out of the National Framework process until these issues have been addressed satisfactorily.”
In 2013, the published data suggests that 28% of tenders are being awarded to countries outside of Ireland, up from a previous high of 18% recorded. Ireland frequently tops the list of countries most likely to award to non-national countries and this trend is increasing all the time.
“Whilst the measures around market analysis in advance of tenders and the reduction in the turnover & insurance provisions, etc. should enable small companies to compete for contracts, the reality is that large suppliers from abroad can leverage their greater buying power to compete better on price” commented Callan. “It is essential that the new procurement system is designed from a think small first perspective, as recommended by the EU, and that actions are put in place to remove the barriers raised against small businesses around the country. A full appeals mechanism should also be implemented forthwith, which would include mandatory feedback on all lost tenders, more scrutiny and transparency throughout the system, an internal appeals procedure in each department and the opportunity to appeal to an Ombudsman.”