Tipperary businesses 'suffering' because of State tendering system

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Tipperary businesses 'suffering' because of State tendering system

Deputy Jackie Cahill

Tipperary TD Jackie Cahill has said that many local small and medium businesses are suffering as a result of Government’s restrictive and unfair tendering processes for State contracts.

Deputy Cahill was commenting after raising the issue with Minister O’Donovan during a special Dáil debate on the difficulties small and medium companies have in accessing State contracts because of the expensive and complicated tendering process.

“I raised two main issues with the Minister: the complicated and downright expensive tendering process that small businesses have to go through just to be in the running to win a contract, and the lack of protection sub-contractors have when they take on jobs for companies who take on State contracts," he said.

The Fianna Fail TD said that the State tendering system had a very low entry level which means that contracts for smaller projects require the full tendering process. These larger companies have lower cost bases and have easier access to credit. This results in small local businesses going up against larger companies. There will be only one winner, and it won’t be the local company.

“This needs to be addressed as it is having an impact on local companies here in Tipperary. We only need to look at how changes to procurement policies have affected local businesses supplying goods and services to the Garda College in Templemore. 

“A local fruit and veg supplier, who have been supplying to the college for years, had his application turned down as he had no written plan in place on how he would continue to trade in the event of major flooding or storms," said Deputy Cahill.

The Thurles-based TD said that the only option left to local businesses wasto secure business as sub-contractors to these larger companies. Yet, this left them exposed as they did not have any of the protections they would have if they had the contract with the State directly. 

“If the main contractor gets into difficulties, the sub-contractor will be the ones left to carry the can. They have no protections yet have all of the responsibilities. The current rules are allowing multinational companies to tender for work with competitive pricing on the backs of local companies," he said.

Deputy Cahill said that Fianna Fáil published the Public Services and Procurement (Social Value) Bill 2017 last year that would require any State body, local authority or Department issuing a tender to take into account the impact of awarding a contract in the local and national economy. 

“The determining criteria on awarding State contracts should not solely be the cost. The social value impact and the potential impact on creating new jobs must be taken into account by the State and its agencies.We are losing jobs locally because of this and it cannot continue,” said Deputy Cahill.