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10-day Payment Rule

Enterprise, Trade And Investment – in the Northern Ireland Assembly at 3:00 pm on 29th September 2009.

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Photo of P J Bradley P J Bradley Social Democratic and Labour Party 3:00 pm, 29th September 2009

5. asked the Minister of Enterprise, Trade and Investment what discussions her Department has had with the Department of Finance and Personnel to ensure that a greater percentage of small sub-contractors, employed to service large Government contracts, benefit from the ten-day payment rule adopted by Departments.            (AQO 124/10)

Photo of Arlene Foster Arlene Foster DUP

The Department of Enterprise, Trade and Investment (DETI) has not been in discussion with the Department of Finance and Personnel about the matter. However, I have raised concerns with the Minister of Finance and Personnel. At the request of the Finance Minister, contracting authorities are encouraged to pay suppliers within 10 days of the receipt of a valid invoice. However, that is not a contractual requirement. The Minister of Finance and Personnel advised that in the case of construction-related works and services contracts that are procured throughout his Department, the contracting authority is required to pay main contractors within a maximum of 24 days from the receipt of a valid invoice. Subcontracts include terms that complement the main contract.

For non-construction related contracts for supplies and services, the payment of all sums that are due to be paid by the main contractor to subcontractors is required within a specified period that does not exceed 30 days from the receipt of a valid invoice. I am advised that the Department of Finance and Personnel will keep payment terms in contracts under review.

Photo of P J Bradley P J Bradley Social Democratic and Labour Party

Will the Minister undertake to give more help to local businesses to enable them to compete for large tenders? I give the recent Invest Northern Ireland advertising contract as an example.

Photo of Arlene Foster Arlene Foster DUP

After an open procurement exercise, that contract was awarded to the person that complied with the contract tender. I regret that the Member was not in his seat to hear me when I talked about public procurement this morning. However, public procurement is one of those areas in which Government can help a lot. We have seen InterTradeIreland introduce the Go-2-Tender programme, which has been successful in helping a number of companies in Northern Ireland secure Republic of Ireland Government contracts. We should welcome very much the work that InterTradeIreland is doing in that regard.

Small companies that I visit raise the issue of public procurement with me. The fact that sometimes there is a ceiling on the amount of money in turnover that those companies must have before they can apply for Government procurement contracts is an issue about which I wrote to the Finance Minister last week, because it was mentioned when I visited a company.

I know that the Committee for Finance and Personnel is conducting an inquiry into public procurement, but it is an area on which we must keep a close eye so that our small businesses get access to it. We know that 82% of Northern Ireland businesses are small or medium in size. We need to tell them that there is a route into Government procurement. On that, I agree with the Member wholeheartedly.

Photo of Alastair Ross Alastair Ross DUP

Will the Minister tell us how her Department’s performance compares with that of others in meeting that 10-day payment target? Will she tell us whether that performance has been improving or worsening over recent months?

Photo of Arlene Foster Arlene Foster DUP

I am glad to say that DETI is one of the better payers in Government. Around 88% of its invoices are paid within 10 working days each month. One may say that that is all very good for DETI, but it is important that my Department shows a lead. I am pleased to say that it is doing so. Our non-departmental public bodies pay 73% of invoices within the 10-day target. The performance of those public bodies is improving monthly, and it is something that we are watching.

Photo of Jennifer McCann Jennifer McCann Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. Given that she emphasised the need for small and medium-sized businesses and the social economy sector to have equal access to public procurement contracts, what input has the Minister’s Department had into the Committee for Finance and Personnel’s inquiry?

Photo of Arlene Foster Arlene Foster DUP

I do not have that information to hand, but I want to contribute to the Committee’s investigation. As I said in answer to an earlier question, public procurement is a recurring theme in my visits to companies, particularly those in the construction sector, which often question why they cannot get access to Northern Ireland Water or other contracts.

My Department and Invest Northern Ireland organised a successful event at the new South West Acute Hospital in Enniskillen, during which we introduced a number of small suppliers to the principal contractor on the site. That worked well, and we will consider repeating that in other large scale contracts.

Photo of Robert Coulter Robert Coulter UUP

Are all Departments co-operating actively in applying the 10-day payment rule?

Photo of Arlene Foster Arlene Foster DUP

As far as I am aware, all the Departments are being monitored against the 10-day payment target. I recall seeing a table that listed all the Departments and the percentage of payments that they make within 10 days. I am sure that table will be made available to the Member if he asks for it.