THE PAST PERFORMANCES of companies bidding for future public construction projects should be used as a factor in the EU procurement regulations, the Taoiseach has said.

His comments in the wake of a row between BAM – the lead construction company behind the delayed and expensive National Children’s Hospital – the Minister for Health Stephen Donnelly and the board of the future hospital yesterday.

In a letter to Simon Harris on Friday, Donnelly put to him it was in the view of the National Paediatric Hospital Development Board, which is responsible for the hospital, that BAM was approaching the project on the basis of “extracting as much money from the Irish taxpayer as possible”.

He added in his letter to the Taoiseach that BAM was “holding the State to ransom”.

Procurement rules in the EU say governments must be transparent and equal, hold an open competition, and have sound procedural management structures when deciding to award firms with public contracts.

It is done so so that European competition and commerce rules are upheld. But many, since the continued delays and increasing cost of the National Children’s Hospital in Dublin, say it’s now time for that to change.

The National Children’s Hospital, which is now years overdue, has cost the state €2.2 billion to date. It had previously been marked for completion in 2020 with a budget of €650 million. 

BAM yesterday said that it had reviewed the contents of Donnelly’s letter to Taoiseach and “rejects in the strongest terms the misleading, ill-informed and incorrect allegations levelled against it”.

Speaking with reporters today in New York, Harris said that it is time that the EU seek to change the factors taken into account by Governments when deciding to award contracts and procure services in the future.

“We do need to look at rules around procurement. We need to also look, I think, at EU rules around procurement.

“It’s really important that Ireland gets the best value and that people live up to the commitments that they gave, in terms of the delivery of the hospital. They need to do that.

“I think we need to make sure that EU procurement rules can allow past performance to be factored into the awarding of public contacts in future.”

He added that Government will impose further penalties on contracts, such as the refusal to provide any further funding to the project after the last increase of €500 million, and it will also be contesting excising procurement claims that it deems “inappropriate”.

BAM has recently been given the cross-border contract for the €60m Narrow Water Bridge project in Co. Louth and the tendering process for the National Maternity Hospital is currently underway. 

Tánaiste Micheál Martin was asked in May why the firm is receiving future Government contracts, to which he said it would not be possible to disallow contractors, who have previously not delivered on budget or on time, from receiving contracts.

He added that he believed it was inappropriate for politicians to “get involved” with the awarding of public contracts and that there are set rules for the procedure.

Includes reporting by Emma Hickey