State bodies fail to avail of cash-saving contracts
Published 18/06/2011 | 05:00
MOST state bodies have failed to avail of a government initiative to buy cut-price stationery and printing services at a 25pc discount -- four months after it was signed.
Just 170 of 400 government departments, public bodies and agencies have acted on the contract, held by Irish company Codex, to save taxpayers up to €2.5m.
The revelation comes as the Minister of State responsible for the Office of Public Works, Brian Hayes, ordered a major crackdown to stop wasteful spending by public bodies.
He has asked officials to draw up within six weeks a list of bodies that have ignored around 40 recently negotiated contracts that offer big savings on goods and services, including protective clothing, uniforms and advertising.
Sources said some public bodies may not have acted because existing contracts have not run out, but others are blankly refusing to end expensive longstanding deals with local suppliers or do not want to give up control to a centralised procurement process.
They said it showed there were still obstacles to public sector reform despite the fact that Environment, Community and Local Government Minister Phil Hogan recently paid tribute to local authorities for making savings of €26m through improved procurement practices under the Croke Park deal.
As he launched a new strategy to make public procurement simpler and cheaper yesterday, Mr Hayes warned it was "time to tackle wayward practices" and warned he may soon adopt a "name-and-shame" approach.
"I'm not satisfied with the level of take-up on this (stationery) contract and that's why I'm going to continue to find out why bodies are not using it and 40 other contracts," he said.
"I think that our task is to explain to public bodies over the next few weeks that his value has been negotiated and there really is no reason why they should not be using it."
The estimated value of the stationery contract is €10m a year -- roughly 25pc cheaper than the previous contract.
The State does not pay the €10m upfront, but payments are made as products are purchased by individual bodies. Items bought are paid for, on receipt of an invoice, under the terms of the Prompt Payments Act, within 15 working days.
The contract covers all government departments and agencies, including the HSE, VECs and universities, but excludes schools.
"The minister is anxious that there be a higher uptake of this contract, given the value for money available," said an Office of Public Works spokesman. "The minister is hopeful there will be significant take-up and that there will be no requirement to name and shame."
Meanwhile, employer body IBEC welcomed the new procurement documents launched by the minister yesterday to streamline procedures.
It said the documents, which aim to cut down on red tape, would simplify the process and allow smaller businesses to access the public procurement market, worth €16bn a year.