I move: "That the Bill be now read a Second Time."
I thank the Minister of State, Deputy Feighan, for being here as he has responsibility for the area of procurement. I thank Senator Alice-Mary Higgins for her work on this legislation. Senator Higgins has worked for the past eight years on this specific legislation. Her commitment to the area of procurement stretches back to before she was elected to the Seanad, however, to her time in civil society when she recognised, as so many others have done, that the issue of procurement has such a wide-reaching impact and effect on so many other areas of how we work in the public sector and that it needs improvement.
What is at the core of this Bill is that public procurement is decided essentially on the criterion of lowest cost only. It is the default mechanism by which public procurement is decided. This Bill seeks to introduce quality as a much stronger criterion. It does not abandon lowest cost but recognises fully that is a hugely important factor in the process. It introduces quality as a measure which should be included in the process. This is all doable within the directives and legislation in any case but, unfortunately, it is not the custom in the design of our procurement processes. That is what we are seeking to address. I thank Senator Alice-Mary Higgins for all her work in bringing the Bill to this Stage. It has been through all Stages in the Seanad and now comes to the Dáil on Second Stage, ready to go to the finance committee if I can convince the Government to reverse its decision to oppose this Bill. I am really proud to build on the work that Senator Higgins has done and bring it to the Dáil floor.
Before I talk about the details and provisions of the Bill and plead again to the Government to support us in bringing this legislation through to the next Stage, I will talk about procurement more broadly, what it means and why it is such an important part of all of our lives. Procurement is very far-reaching and covers everything we buy as a State. As a party, we were trying to figure out how to make procurement sexy, and I do not know if we can, but one way of trying to help people understand it a bit better is that it is basically how the State does shopping. It is how it goes out and buys and purchases things, be those services or goods.
We are all very familiar with the big projects and the scandals, essentially, that have hit this Government over the last number of terms. They include the national children's hospital, CervicalCheck, the hot school meals programme recently, and in so many different areas. Having listened to previous Topical Issue debate, which was raised by Deputy Doherty, it sounds as if procurement is at the heart of another issue that has been raised on the Dáil floor.
Procurement also reaches into many of the smaller things. I have worked in the public sector and I have been an Accounting Officer in a State agency, so I am very familiar with the procurement process and how deep it is in the heart of every public sector body. It is an area of expertise within public sector bodies and it is important that we empower people who procure on behalf of this State to count not just price in the design of their criteria but also introduce quality.
Besides the big examples I gave, I will introduce some smaller ones that people might not be as familiar with or might not remember. One that I will mention is the contract for library books back in 2012. A contract drawn up at that stage essentially excluded smaller providers from bidding within the contract structure. Ultimately, the contract went to a UK company. This decision gutted bookshops across the nation. There were a huge number of lay-offs and closures. A bookshop in Sandyford in my constituency had to close down as a result. One of the bookshop owners said:
What galls me the most is the tender notice stated candidates should have access to, and experience of, dealing with small, local publishers and authors and have in-depth of the Irish publishing scene. I fail to see how a UK chain would have any knowledge of little known publishers in Ireland. This decision was made purely on price and it is really short-sighted.
This has been happening for many years. The example I cited was raised with me when I spoke with the Minister's colleague, Deputy Lahart. When I spoke about this process, he immediately came back to me with an example. That has been my experience because I have been talking about this to many colleagues over the past two weeks. They all have examples of how the current procurement process has failed us and how they see the value in this legislation.
Another example we have discussed was one that came from a carer who talked about the fact that the HSE provide for her, in the provision of her work, incontinence pads, which she then uses on her clients. She said because the HSE switched providers, she had to start changing incontinence pads for her patients four times a day instead of twice a day because the quality of the product dropped with the new provider. I genuinely cannot think of a more human example of how public procurement reaches into the depths and intimacy of our lives than that exact example. For that patient and client, it means that twice as many times a day and twice as many times across her life, she has to experience the discomfort of having that incontinence pad changed. That seems like such a small example but for somebody in that situation, it is a mammoth way in which her life has changed.
Let us have a look at the numbers when we talk about procurement because Ireland plans to spend €275.4 billion in the next five years under the national development plan. We know that is already in addition to the €19 billion a year we spend on public procurement. This is so wide-reaching. I will now talk about the provisions because, as I mentioned, this is about shifting the culture of how public procurement is done from one that values cost only to one that should value quality. The key provisions and sections in this Bill are sections 3 and 4, which outline exactly how quality should be considered within the procurement process and that when quality is not a consideration, how those exceptions should be applied.
We fully appreciate and acknowledge that there are times when lowest cost only is a metric which is applicable to a particular procurement process. This was very much a piece of work that Senator Higgins did in reshaping the legislation to say we want you to think about quality and if you are not thinking about quality, you need to explain why not. There is a mechanism by which you have to raise up the flag pole of any public sector body why you are not thinking about quality and you have deemed that this process should be based on lowest cost only.
That is exactly the kind of accommodation that we seek to see when we are developing this kind of legislation, and in response to Government concerns when it was going through the Seanad and in her interactions with the Office of Government Procurement, OGP. I should add, by the way, that this has been done in consultation with the OGP throughout these eight years of work and, indeed, with the co-operation of the Office of Parliamentary Legal Advisers, OPLA, in the development of the legislation itself.
Sections 5 and 6 then go on to deal with certain other elements. The public sector duty was introduced into the State in 2014. The Irish Human Rights and Equality Commission Act 2014 sets out that public bodies have to have regard for human rights and equality in the work that they do. Section 5 allows for this to be a part of the procurement reporting process. Section 6 also emphasises that social consideration should be another part of it.
It is a simple Bill. It is a straightforward Bill. It is a Bill that is essentially in response to the 2014 directives that determined how Ireland would go about its procurement and how every member state, indeed, would go about procurement. Unfortunately, in that instant, Ireland chose to interpret it in such a way that led us to this default situation of lowest cost only, and this legislation seeks to correct exactly that.
We are lucky because we have a Dutch experience where this type of legislation has been introduced and we have really strong data which captures what happened there. What we see in that Dutch example is that 73% of the contracts still go to lowest cost only. We are not trying to say that it should not be that big a feature. We know that it is, but we want to make sure it allows us to take account of the quality criteria as well. Within that Dutch model, the other important figure is that they found that there was a 3% increase in the procurement process costs - not in the projects themselves; let us be clear on that - which is a marginal one, and there was a 2.4 times equivalent benefit reported by those actors.
I will conclude and pass over to my colleagues to talk about specific examples in this area by pleading with the Minister of State to support this Bill and reverse the Government's decision to oppose it. Any concerns the Minister of State has about money - I am pre-empting what he might say in his contribution - can be dealt with on Committee Stage or the money message process. Any concerns the Minister of State has about those finance considerations can be dealt with there. What I want to see is the Minister of State putting his money where his mouth is in terms of saying that he wants us to offer solutions and that he wants to work with us because I could not find a clearer example of exactly that. I plead with the Minister of State to support it.
