The feedback I'm getting from consultant colleagues in relation to the hoops they have to go through to certify money in interim accounts is interesting. Basically the Engineers working on behalf of the Local Authorities must have every item accounted for when only producing an Interim Certificate. This sounds ridiculous to a certain degree. For example the other day I could not get a 'sum on account' certified on an interim certificate for Engineer's phone calls (payable under the contract and I estimated a reasonable gross value on the job to date at€500.00). The Interim Certificate or Payment wouldn't be made until such time as the phone bills were produced. Fair enough policy when you think about it......
This attention to detail is not the fault of the Engineer but was due to the audit's going on within the DOF ever since the GCCC forms were produced (over 3 years now). In the old days sums on account would be paid for such an item. In general we would gather the phone bills on a quarterly basis for submission or even wait until final account stage and then submit the full documentation.
This leads me to a Message / Question to the Department of Finance:
Why the hell didn't you guys take as much care with everything else you were supposedly in control of over the last 5 years?
It's a pity the other ills that fell on this Country weren't kept in check in such a similar fashion as our Construction Industry.
Oh wait a minute .........Then again it doesn't surprise me why such focus was on the Construction Industry (Public Sector Area of the Market) as we were the ones getting bad press for the last 10 years or so (project overruns, wrong initial cost projections...... blah de blah).
This Government was led more by what the papers and media were saying rather than what the country's real citizens and real honest to goodness workforce were saying. As long as the Fianna Fail machine was keeping the press happy they were happy and nothing else really mattered.
Showing posts with label Department of Finance. Show all posts
Showing posts with label Department of Finance. Show all posts
Saturday, November 20, 2010
Wednesday, September 22, 2010
Facilitating SME's in Public Procurement - is it too little too late?
The department of finance issued a circular back in August in relation to new guidance for the procurement of public works.
These new guidelines are aimed at facilitating Small and Medium Enterprises (SME's) and ensuring that the public works market remains open to these companies.
Is the publication of this circular too little too late?
The basic changes of the new guidance and the changes pertinent to the construction sector can really be synopsised in 2 paragraphs as follows:
1 - The 'dual' stage / pre-qualification procedure for projects valued below €250,000 is now history.
Prior to this change the local authorities and other contracting authorities were using the two stage system or 'dual stage' where companies had to first make a shortlist. These shortlists are usually no more than 10 candiates and more often than not they are limited to just 5 candidates (particularly where the NRA were involved), whom then get to price the actual work.
The drawing up of these shortlists of contractors for each individual project, are derived from the first stage of the 'dual' stage by means of a pre-qualification questionnaire competition, or a beauty contest. These documents created a huge additional workload for small family run operators who in the current climate weren't geared up to undertake the completion of these PQQ's. In my own experience I have carried out some of these PQQ applications and this involves multitudes of paperwork for projects that would be for example €500k, and this was just to get the chance to price the work.
2 - The vast amount of paperwork will now no longer be requested until the pricing stage is completed, i.e. the winning bidder or bidder who is coming under consideration for the project will be asked for their insurance, tax clearance, bond undertaking, company structure etc only after the price is submitted and they are deemed the most economically advantageous.
One would imagine that these new guidance issues are as a result of lobbying by ISME, IBEC the CIF and various other groups working on behalf of SME's.
Is it too little too late or is it a case of any change to the current process is a step in the right direction?
Personally I believe it is a bit of both, i.e. they could have stretched the threshold to €500k or even €750k, however in this climate I'm sure any change where SME's will be allowed enter the market is a good one.
Sometimes its best to weigh up whether a change like this will work and function the way it should by way of everyday examples:
The DOF has stated (in this circular) that the SME sector is a very important business sector for the economy and that they are not hindered from competing for Contracts.
Example: Joe Bloggs Civil Contractor has done small culvert type bridges and many other structural concrete works down the years as a small sub-contractor to one or two of the 'mega' motorway contractors. He can't pre-qual to the pricing stage for a medium type standard bridge due to alleged lack of experience and also because he won't gain enough marks in the PQQ system ahead of the 'mega' lads he has worked for in the past. How does Joe ever build a bridge or how does Joe every compete in the market if it will be closed to those who have only built bridges in the past? Will this new system allow Joe as an experienced SME get into the bridge construction market? It is highly unlikely as one doubts there will be a bridge in this new process valued below the €250k threshold, whereas if the threshold was €750k at least Joe has a chance. Even if there was a bridge project at the €250k value then the parameters set down by awarding authorities on a larger bridge project (where Joe would have to pre-qualify) would in fact hinder Joe.
This is where an opportunity has been missed by the National Procurement Service and the Department of Finance.
Another flaw is the evaluation of the projects. Who values the projects and states whether they are within the threshold or not? Is it the awarding authorities? If so what is their basis of calculating if a job falls within the threshold or not?
This blogger also notes that the National Procurement Service was set up in 2009, another quango set up slap bang in the middle of a recession? Where the hell was this outfit during the boom when we had work to procure?
The DOF circular paragraph 6 is interesting reading. Its almost as if the DOF are only now letting the local authorities know that there is an agency in place to help them with procurement matters!!
Finally, if this NPS is around then what are the National Public Procurement Policy Unit (NPPPU) working at these days? I do know they run the excellent etenders website which I note is been copied by local authorities / public authorities in cities and countries around Europe presently, so well done to them on that front but could they not also manage to carry out the role of the National Procurement Service also?
Here is the link to the relatively new circular discussed above:
http://www.constructionprocurement.gov.ie/CWMFDocs/Circulars/Circ1010.pdf
These new guidelines are aimed at facilitating Small and Medium Enterprises (SME's) and ensuring that the public works market remains open to these companies.
Is the publication of this circular too little too late?
The basic changes of the new guidance and the changes pertinent to the construction sector can really be synopsised in 2 paragraphs as follows:
1 - The 'dual' stage / pre-qualification procedure for projects valued below €250,000 is now history.
Prior to this change the local authorities and other contracting authorities were using the two stage system or 'dual stage' where companies had to first make a shortlist. These shortlists are usually no more than 10 candiates and more often than not they are limited to just 5 candidates (particularly where the NRA were involved), whom then get to price the actual work.
The drawing up of these shortlists of contractors for each individual project, are derived from the first stage of the 'dual' stage by means of a pre-qualification questionnaire competition, or a beauty contest. These documents created a huge additional workload for small family run operators who in the current climate weren't geared up to undertake the completion of these PQQ's. In my own experience I have carried out some of these PQQ applications and this involves multitudes of paperwork for projects that would be for example €500k, and this was just to get the chance to price the work.
2 - The vast amount of paperwork will now no longer be requested until the pricing stage is completed, i.e. the winning bidder or bidder who is coming under consideration for the project will be asked for their insurance, tax clearance, bond undertaking, company structure etc only after the price is submitted and they are deemed the most economically advantageous.
One would imagine that these new guidance issues are as a result of lobbying by ISME, IBEC the CIF and various other groups working on behalf of SME's.
Is it too little too late or is it a case of any change to the current process is a step in the right direction?
Personally I believe it is a bit of both, i.e. they could have stretched the threshold to €500k or even €750k, however in this climate I'm sure any change where SME's will be allowed enter the market is a good one.
Sometimes its best to weigh up whether a change like this will work and function the way it should by way of everyday examples:
The DOF has stated (in this circular) that the SME sector is a very important business sector for the economy and that they are not hindered from competing for Contracts.
Example: Joe Bloggs Civil Contractor has done small culvert type bridges and many other structural concrete works down the years as a small sub-contractor to one or two of the 'mega' motorway contractors. He can't pre-qual to the pricing stage for a medium type standard bridge due to alleged lack of experience and also because he won't gain enough marks in the PQQ system ahead of the 'mega' lads he has worked for in the past. How does Joe ever build a bridge or how does Joe every compete in the market if it will be closed to those who have only built bridges in the past? Will this new system allow Joe as an experienced SME get into the bridge construction market? It is highly unlikely as one doubts there will be a bridge in this new process valued below the €250k threshold, whereas if the threshold was €750k at least Joe has a chance. Even if there was a bridge project at the €250k value then the parameters set down by awarding authorities on a larger bridge project (where Joe would have to pre-qualify) would in fact hinder Joe.
This is where an opportunity has been missed by the National Procurement Service and the Department of Finance.
Another flaw is the evaluation of the projects. Who values the projects and states whether they are within the threshold or not? Is it the awarding authorities? If so what is their basis of calculating if a job falls within the threshold or not?
This blogger also notes that the National Procurement Service was set up in 2009, another quango set up slap bang in the middle of a recession? Where the hell was this outfit during the boom when we had work to procure?
The DOF circular paragraph 6 is interesting reading. Its almost as if the DOF are only now letting the local authorities know that there is an agency in place to help them with procurement matters!!
Finally, if this NPS is around then what are the National Public Procurement Policy Unit (NPPPU) working at these days? I do know they run the excellent etenders website which I note is been copied by local authorities / public authorities in cities and countries around Europe presently, so well done to them on that front but could they not also manage to carry out the role of the National Procurement Service also?
Here is the link to the relatively new circular discussed above:
http://www.constructionprocurement.gov.ie/CWMFDocs/Circulars/Circ1010.pdf
Wednesday, March 24, 2010
Are the Public Servants Holding Constructors to Ramsom in Eire?
Greetings colleagues. I haven't published for a while but I make no apologies for this.
Chasing work has kept me busy. Similar to many people in Ireland in our Industry I've a house to pay for and a family to keep. Work is very very scarce indeed.
As a matter of fact for the first time in 12 years as a permanent employee for a long established Civil Engineering Contractor I now fear for my job security and I'm even gearing myself up to get plan 'B' into operation which will most likely involve freelance work.
Freelance work would not pose any fear for me as during the boom years I managed to squeeze in a Post Graduate Contract Law Course and a Post Graduate Arbitration Course. However having a steady job and job security was very comforting and regardless of the Public Sector pay cuts and their pension levies they still have the comfort and security of knowing that they have a job to go to every Monday morning.emm(?)
The current situation in the Civil Engineering market is diabolical to say the least. Sources tell me that some Public Sector Area's are failing to release Contract Documents where funding is in place. If this is true then it is an almighty scandal as the chain affects of not issuing necessary infrastructure work is catastrophic as this will only lead to further job losses in the industry.
I do know for a fact that my company has completed pre-qual after pre-qual in the period May 2009 until mid-February 2010 and for the large majority of these pre-qual competitions not even the pre-qual result was published.
This is crippling small and medium Civil Contractors around the Country and in the long term only add to the Public Spending Bill by virtue of the fact that another 40,000 construction personnel are expected to be unemployed for 2010.
If the government start acting now and the Public Servants are made to start releasing tenders immediately then some of these jobs would be saved and important infrastructure works would commence.
Some such project examples are as follows:
Lough Forbes Water Treatment Works - First advertised in May 2009
The Metals Dun Laoighaire - First advertised in May 2009
Grange Bridge in Kilkenny - First advertised in May 2009
Ballymahon and Granard Water Treatment - June 2009
River Fergus Flood Alleviation - September 2009
Belcamp Lands Remediation - January 2010
Embankment Road Extension Tallaght - February 2010
All of the above are 2 stage select tenders (pre-qualification competition first) yet all but one of these projects has yet to reach the second stage; the pricing stage. Why is this?
In the meantime the other projects that were advertised in the back end of 2009 and so far this year have been few and far between, so one wonders where the so call 'Capital Spend' promised in the last budget is going?
My guess is that the government are holding off until the NAMA transfers have commenced properly or else perhaps some Public Sectors are acting in a similar fashion to our friends in the Passport office. Maybe funds are in place for Contracts but the Public Servants are on some sort of work to rule and not bothering to issue the tender documents?
FOGRA:
I noticed in the Sunday Business post at the weekend that the Department of Finance are reviewing the PPP model and now deem it bad value for money.
This blogger and many more amongst us and even people with a level Pass C leaving certificate maths would realise this. The Government pumping the circa € 110,000,000 subvention into the Kilkock - Kinegad bypass motorway PPP back in the day was a complete disgrace.
This amount of cash, at the time, would have built 15 to 20 km of motorway on its own without having the necessity for a toll.
Anyhow, as soon as this Blogger hears more on the DOF review I will post some thoughts and comments. However, it would appear to be a more than likely a Fianna Fail PR move in order to ditch the Metro for a few years without upsetting the Greens too much.
You know what ... all of the above reminds me of something familiar.......................
http://constructionconciliation.blogspot.com/2009/07/irish-government-needs-to-stimulate.html
Chasing work has kept me busy. Similar to many people in Ireland in our Industry I've a house to pay for and a family to keep. Work is very very scarce indeed.
As a matter of fact for the first time in 12 years as a permanent employee for a long established Civil Engineering Contractor I now fear for my job security and I'm even gearing myself up to get plan 'B' into operation which will most likely involve freelance work.
Freelance work would not pose any fear for me as during the boom years I managed to squeeze in a Post Graduate Contract Law Course and a Post Graduate Arbitration Course. However having a steady job and job security was very comforting and regardless of the Public Sector pay cuts and their pension levies they still have the comfort and security of knowing that they have a job to go to every Monday morning.emm(?)
The current situation in the Civil Engineering market is diabolical to say the least. Sources tell me that some Public Sector Area's are failing to release Contract Documents where funding is in place. If this is true then it is an almighty scandal as the chain affects of not issuing necessary infrastructure work is catastrophic as this will only lead to further job losses in the industry.
I do know for a fact that my company has completed pre-qual after pre-qual in the period May 2009 until mid-February 2010 and for the large majority of these pre-qual competitions not even the pre-qual result was published.
This is crippling small and medium Civil Contractors around the Country and in the long term only add to the Public Spending Bill by virtue of the fact that another 40,000 construction personnel are expected to be unemployed for 2010.
If the government start acting now and the Public Servants are made to start releasing tenders immediately then some of these jobs would be saved and important infrastructure works would commence.
Some such project examples are as follows:
Lough Forbes Water Treatment Works - First advertised in May 2009
The Metals Dun Laoighaire - First advertised in May 2009
Grange Bridge in Kilkenny - First advertised in May 2009
Ballymahon and Granard Water Treatment - June 2009
River Fergus Flood Alleviation - September 2009
Belcamp Lands Remediation - January 2010
Embankment Road Extension Tallaght - February 2010
All of the above are 2 stage select tenders (pre-qualification competition first) yet all but one of these projects has yet to reach the second stage; the pricing stage. Why is this?
In the meantime the other projects that were advertised in the back end of 2009 and so far this year have been few and far between, so one wonders where the so call 'Capital Spend' promised in the last budget is going?
My guess is that the government are holding off until the NAMA transfers have commenced properly or else perhaps some Public Sectors are acting in a similar fashion to our friends in the Passport office. Maybe funds are in place for Contracts but the Public Servants are on some sort of work to rule and not bothering to issue the tender documents?
FOGRA:
I noticed in the Sunday Business post at the weekend that the Department of Finance are reviewing the PPP model and now deem it bad value for money.
This blogger and many more amongst us and even people with a level Pass C leaving certificate maths would realise this. The Government pumping the circa € 110,000,000 subvention into the Kilkock - Kinegad bypass motorway PPP back in the day was a complete disgrace.
This amount of cash, at the time, would have built 15 to 20 km of motorway on its own without having the necessity for a toll.
Anyhow, as soon as this Blogger hears more on the DOF review I will post some thoughts and comments. However, it would appear to be a more than likely a Fianna Fail PR move in order to ditch the Metro for a few years without upsetting the Greens too much.
You know what ... all of the above reminds me of something familiar.......................
http://constructionconciliation.blogspot.com/2009/07/irish-government-needs-to-stimulate.html
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