Modern governments have phenomenal spending power. Like a householder, they need to engage tradesmen and professionals of various types to do work the State needs done.
You want a new motorway? Here is a company to build it. You want a new harbour? Here is a company to dig it. You want a contract drafted for the motorway construction to secure your interests and ensure you get value for money? Here is the solicitor to write it for you.
These contracts are very valuable. They allow the person to whom the contract is awarded to, at the very least, pay the wages of the staff of the successful tendering company, say, during slack industry trading periods.
They also represent opportunities for pork-barrel politics. The politician who formulates and guides the policy resulting in the decision to have a motorway in the first place and then the decision as to who will get the contract, wields enormous power. The exercise of that power can secure re-election by the votes of grateful beneficiaries or the money to win those votes in an election.
Clearly, they represent opportunities for criminal activity in the form of fraud and corruption.
That aside, the State, as a major economic engine, can âdistortâ? the free market in goods and services. The European Union is professedly wedded to ensuring such markets, as are of a minimum size, will be free.
Consequently, EU member states are obliged to adjust their national law to conform to Directive 2004/18/EC intended to ensure only economic considerations (broadly defined) are the determining factor in the awarding of those public contracts which reach the threshold limit.
(HERE is a reference to an Irish-related case dealing with the obligation to advertise (or not!), that the contract is available.)
Ireland passed European Communities (Award of Public Authoritiesâ Contracts) Regulations 2006 (Statutory Instrument No. 329 of 2006) to comply with its EU obligations in this regard.
The Regulations are legally binding on the awarding authority. In Chapter 3 there is set out the basis for the awarding of the contracts:
Criteria for the award of a public contract
66. (1) A contracting authority shall, in awarding a public contract on the basis of the tender that is most economically advantageous to it, adopt criteria linked to the subject matter of the contract.
(2) Except as provided by paragraph (1), a contracting authority shall award a public contract on the basis of the lowest price.
(3) For the purpose of paragraph (1), the criteria may include (but are not limited to)â
· quality,
· price,
· technical merit,
· aesthetic and functional characteristics,
· environmental characteristics,
· running costs,
· cost-effectiveness,
· after-sales service and technical assistance, and
· delivery date and delivery period or period of completion.(4) The contracting authority shall specify in the relevant contract notice or contract documents or, in the case of a competitive dialogue, in the relevant descriptive document, the relative weighting that it gives to each of the criteria chosen to determine the most economically advantageous tender. That weighting can be expressed by providing for a range within an appropriate maximum spread.
If an unsuccessful party wishes to challenge the legality of the award of a public procurement contract it is necessary to do so as quickly as possible.
Failure to act swiftly will preclude the applicant from relief. (See HERE).