Public Procurement Reform - Update
Vincent Campbell
Director of Procurement Policy
Meetwest Galway Bay Hotel – November 20th
Agenda
How is Public Procurement
Changing?
Policy and SME Matters
Procurement Reform Overview
•
Public procurement reform is a key element of the public service
reform programme - to reduce costs and achieve better value for money
through reform of public sector procurement
•
Public service spends approx. €8.5bn per annum on goods +
services
–
•
€3.5bn per annum on works
The Office of Government Procurement
–
–
–
launched in July 2013
operates as an office of the Department of Public
Expenditure and Reform, with its own Vote
strong governance model, Board chaired by Minister of
State
•
Savings target of €500m over 3 years
•
Operation of the new model commenced in 2014
•
All will be brought together under new enabling legislation
Drivers of Change
•
•
•
The current model is highly fragmented – over 4000 bodies
carrying out procurement.
Many systems are poor with limited data upon which to
make decisions
Government strategy is to …
– centralise procurement more,
– enable consistency and standardisation of approach,
– align policy with operations,
– professionalise and modernise procurement –
increased skill-sets, focused training backed up by
strategic data
– deliver better value for the tax-payer,
– deliver broader policy goals (Social, Environmental,
SMEs and Innovation etc..) in a consistent fashion.
The New Model
Health
Education
Office of
Government
Procurement
Local
Government
Defence
Common Policies
Common Systems, Processes and Data Management
Common Governance
• The Public Service will speak with ‘one voice’ to the market.
• Common goods and services will be sourced from one office, formed from
resources who will come together from across the civil and public service.
• Health, Education, Local Government and Defence will each retain a single sector
procurement function to procure sector-specific categories.
The New Model
OGP Led Categories
Sector Led Categories
• Professional Services
• Facilities Management and
Maintenance
• Utilities
• ICT and Office Equipment
• Marketing, Print and
Stationery
• Travel and HR Services
• Fleet and Plant
60% of
• Managed Services
spend
• Local Government
– Minor Building Works and Civils
– Plant Hire
• Health
– Medical Professional Services
– Medical and Diagnostic
Equipment and Supplies
– Medical, Surgical and
Pharmaceutical Supplies
• Defence
– Defence and Security
• Education
– Veterinary and Agriculture
– Laboratory, Diagnostics and
Equipment
Category Councils
Customer Needs & Category Councils
• Objective is to deliver contracts that meet the needs of
customer organisations and that deliver value for money for
the tax-payer.
• Aim is not to aggregate everything the public sector buys.
• Role of Category Councils is decide the sourcing strategies for
goods and services i.e. size of market offering (lots) ,
– taking into account customers’ requirements, market dynamics and
the savings required.
• Each Council includes members who are nominated by the
Departments and Agencies that are the main users of the
category.
OGP Business Intelligence
In its simplest form, the OGP Business Intelligence solution will facilitate
intelligent, fact-based decisions for our sourcing and category teams.
Aggregate
Data
Enrich
Data
Present
Data
Inform a
Decision
Implementation Progress
Establishing the Office of Government Procurement
Initiation
•
•
•
•
Planning &
Scoping
Implementation
Operation
On-going
Review
Management Team Appointed.
Staffing Compliment will be 231 – over 110 on board
Website launched www.procurement.ie
Governance established with involvement from across public
service at Ministerial, Secretary General and Senior
Management levels.
• Operation of the new model commenced in 2014, full roll-out
in 2015.
• All frameworks available are published in www.procurement.ie
Perceived Barriers to SME’s
• Lack of understanding of how the public sector buys
• Administrative/Cost burden – red tape
• Size of contracts – opportunities
• Disproportionate financial capacity requirements
• Unclear award criteria
• Lack of accessibility of public procurers
• Absence of feedback from some areas
SME Involvement
• Government very conscious that SME’s are a significant driver in
economic recovery
• We have established an SME working group to reduce barriers for
SME participation in public procurement
– CIF, SFA, IBEC, ISME, Chambers Ireland
• We continue to drive pro-active engagement and education with
suppliers e.g. ‘Meet the Buyer’ events and ‘Go 2 Tender’ training
programme
– delivered in partnership with InterTrade Ireland and
Enterprise Ireland
• We continue to standardise our tender and contract documents
– New release of documents expected early in 2015
Business Engagement
Circular 10/14
Key Messages
Aim of Circular 10/14
Sets out new initiatives
aimed at opening up
opportunities for small
businesses to bid for State
business
Reducing the administrative
burden on businesses that
want to tender for public
contracts.
It accelerates some of the
key business-friendly
initiatives included under
the new EU Public
Procurement Directive,
currently being transposed
by my Department.
Circular 10/14 – Key Features
Company turnover
requirements to be set at
no more than twice the
estimated contract value.
Reasonable insurance levels.
Registration of SMEs on
eTenders to ensure
maximum exposure to
tendering opportunities
within their sector.
Market analysis to inform
strategy. Breaking
contracts into lots enabling
smaller businesses to
compete for these
elements.
Tenderers to advertise
contract opportunities
above €25,000 on eTender
to promote SME
participation.
SMEs using consortia
where they are not of
sufficient scale to tender in
their own right .
Buyers to encourage new
and innovative solutions.
On-Going Reform
Summary
In summary, Procurement Reform is a key enabler
in helping Ireland reduce its deficit.
It will also modernise and professionalise how we
do procurement in the public service.
This will deliver significantly improved value for
the tax-payer.
A significant policy agenda is also underway to
underpin and support the changes.
Thank You
Vincent.Campbell@ogp.gov.ie