Update: Public Procurement, 3rd July 2015

QUESTION NO:  104

DÁIL QUESTION  addressed to the Minister for Public Expenditure and Reform (Deputy Brendan Howlin)
by Deputy Bernard J. Durkan
for WRITTEN ANSWER  on 02/07/2015    

 
 To ask the Minister for Public Expenditure and Reform the extent to which public procurement remains a central feature of the control of costs throughout the Public Sector; the degree to which he has measured the success in this area over the past four and a half years to date in 2015; and if he will make a statement on the matter.
 
REPLY.

The reform of the procurement system across the public service is a key element of the reform programme for the public service.   The fragmented procurement arrangements across the public service have enabled suppliers to charge different public service bodies different prices for the same goods and services. The savings enabled by centralised public procurement will allow public service organisations to better operate within their budget allocations while maintaining or improving services for the public.

Since the start of the Procurement Reform Programme total savings of €100m over 2013 and 2014 have been reported by the Office of Government Procurement (OGP) and its sector partners in Health, Local Government, Education and Defence. The €100m excludes €16.5m in Utilities savings from OGP sourcing activity in 2014 as this would be regarded as a cost avoidance procurement benefit rather than a cash saving as the savings arise from beating inflation.

It is important to note that, while the OGP and its sector sourcing partners can enable savings by putting frameworks and contracts in place, realisation of actual cost savings is dependent on public sector bodies availing of the new procurement arrangements.   This may not be immediately feasible due to limited contract termination arrangements or lags in moving to the new supply arrangements (e.g. stocks, change-overs, etc.).