Contracts

Finance and Personnel – in the Northern Ireland Assembly at 3:00 pm on 16th March 2010.

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Photo of Willie Clarke Willie Clarke Sinn Féin 3:00 pm, 16th March 2010

3. asked the Minister of Finance and Personnel whether he can provide an assurance that any contracts secured by his Department through public procurement tenders will be measured in terms of value for money and social outcomes. (AQO 947/10)

Photo of Sammy Wilson Sammy Wilson Shadow Spokesperson (Education), Shadow Spokesperson (Treasury)

The Northern Ireland procurement policy is delivering best value for money. The Central Procurement Directorate (CPD) measures value-for-money gains achieved when each contract is awarded. In the 11 months to February 2010, CPD recorded value-for-money gains of £21 million: in other words, it examined projects and thought that they could be done better. That compares with £17·5 million for the entire previous year. Therefore, there has been some improvement as far as value for money is concerned.

Departments must determine the sustainable and social impact that they wish to achieve from their programmes and projects. The role of procurement professionals is to facilitate the delivery of those outcomes via the procurement process, ensuring that it is compliant with EU and UK law. For example, since 2008, social clauses have been included in construction projects where appropriate: for every £2 million spent, one apprentice should be employed; and for every £5 million spent, one long-term unemployed person should be taken on. Those are the guidelines, and they have had an impact on projects.

Photo of Willie Clarke Willie Clarke Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. I thank the Minister for his response. That is the point that I was trying to make. Will his Department and the Central Procurement Directorate actively promote the use of social clauses by other Departments and make it compulsory for them to do so in relation to long-term unemployed apprenticeship schemes by building such clauses into contracts?

Photo of Sammy Wilson Sammy Wilson Shadow Spokesperson (Education), Shadow Spokesperson (Treasury) 3:15 pm, 16th March 2010

As I said, that is already being done with construction projects. I should have some figures here somewhere about some of the projects where that has happened. For example, it has happened in my constituency at the Northern Regional College skills centre at Newtownabbey. That project has led to one long-term unemployed person and four apprentices being employed. Two long-term unemployed people and five apprentices have been employed in the OMAC theatre in Belfast as a result of clauses that were built into the procurement contract there.

It is a bit more difficult to promote the use of social clauses with service contracts, because they tend to be smaller and more fragmented by their nature. However, we are looking at how we can build in some social requirements to those contracts as well.

Photo of Ken Robinson Ken Robinson UUP

Given that we are a small-business economy, what progress can the Minister ensure is made to make sure that public procurement tenders are more accessible to small firms across Northern Ireland?

Photo of Sammy Wilson Sammy Wilson Shadow Spokesperson (Education), Shadow Spokesperson (Treasury)

A number of things have been done. Again, I have to give caveats to all my answers by indicating that we have to comply with EU law in particular, much as it sticks in my gullet to say that. Given the regulations that are laid down as a result of EU legislation, especially on procurement, we cannot discriminate in favour of small local firms. However, we have tried to do things in a number of ways. For example, we have encouraged consortia of firms to apply for contracts and we have looked at the supply chain to try to ensure that small firms have an input, even where the huge contracts are concerned. The Construction Employers Federation in Northern Ireland has been very helpful in giving us some useful guidelines on how we can do that.

Of course, there is always a balance to be struck in getting economies of scale; we can have huge procurement projects and break them down into smaller contracts. We have done that with cleaning contracts, for example, in that we regionalised some of the contracts so that small local firms could apply, rather than the project being Northern Ireland wide. We have done the same with some consultancy projects. A mixture of things can be done, but it all has to be in the context of some very detailed procurement law.

Photo of Patsy McGlone Patsy McGlone Social Democratic and Labour Party

Go raibh maith agat, a LeasCheann Comhairle. Bearing in mind the answer that the Minister has just given, what is his assessment of the recent report from the Finance Committee on public procurement? He talked about compliance with EU laws, but has his Department had any communication with the Department for Regional Development (DRD) through the Departmental Solicitor’s Office about the widely reported incident involving Northern Ireland Water?

Photo of Sammy Wilson Sammy Wilson Shadow Spokesperson (Education), Shadow Spokesperson (Treasury)

First, we had a long debate on the Finance Committee’s report on procurement in the House, and I congratulated the Committee on that report then. It was a balanced report; it was not one of those that sought only to pick holes and to get a cheap headline. It is a useful piece of work that Departments can work on. Of course, all its delivery is not for DFP, because it affects other Departments. As I indicated, although I may have some sympathy with some of the report’s recommendations, I am not sure that it is possible to implement them. However, I also indicated that I am considering it and that I will come back to the Committee. We may even have another debate in the Assembly on it.

Northern Ireland Water and DRD have their own centre of procurement expertise (COPE). The matter is really a responsibility for the Minister for Regional Development, and, of course, he has acted by giving notice to a number of the directors already.