Full response to PQ on value of Direct Provision contracts

Posted On: 20 February 2013

The Irish Refugee Council would like to thank Deputy O’Sullivan for tabling this question on our behalf:


DAIL QUESTION addressed to the Minister for Justice and Equality (Mr. Shatter)by Deputy Maureen O’Sullivan for WRITTEN on Thursday, 14th February, 2013.  

   *  To ask the Minister for Justice and Equality the value of the individual contracts to providers of direct provision accommodation; and if these contracts were advertised and awarded as per the EU public procurement regulations.                                                      

      – Maureen O’Sullivan

REPLY. The question relates to the spending and procurement policy of the Reception and Integration Agency (RIA), a functional unit of the Irish Naturalisation and Immigration Service (INIS) of my Department, which is responsible for the accommodation of persons while their applications for international protection are being processed. Currently there are 4,836 persons accommodated throughout the State in 35 centres under contract to RIA.   Of the 35 centres in the State, 7 are State owned.  That is to say, while the centres are managed by private contractors under contract to RIA, the land and buildings are owned by the State.  Details of all centres currently under contract to RIA are available on its website – www.ria.gov.ieA list comprising the value and other details of all contracts for commercial centres, issued by RIA between 2000 and the end of 2010, has been prepared for the Deputy.  Because of the size of this table, it is not possible to insert it into this answer and it is therefore being forwarded to the Deputy separately.  As explained in replies to previous Dail Questions, it is not in the interest of the taxpayer that details of current individual contracts are known to the public or to other parties who are, or may be in the future, engaged in negotiations with RIA. Therefore, details of current contract rates are not provided.  The policy is that at the end of January each year a table of contracts is updated to show all financial information up to the end of December two years previously, i.e.. at the end of January, 2013 the records are updated to end of December 2010.  This policy has been upheld by the Office of the Information Commissioner.    

In relation to RIA’s procurement policy, it is important to note that RIA does not lease or rent premises from commercial contractors. Rather, it ‘contracts-in’ a comprehensive range of services and facilities, which include accommodation, food provision, housekeeping etc., for a fixed sum over the period of the contract. A distinction needs to be drawn in relation to procurement processes as between RIA’s State-owned accommodation centres and the commercially owned and operated centres. The most recent  tender process for the management of the State owned centres was carried out last year by way of public competition in accordance with EU Council Directive  2004/18/EC (co-ordinating procedures for the award of public works contracts, public supply contracts and public service contracts) as implemented into Irish law by Statutory Instrument 329 of 2006.  

In relation to the commercially owned and operated centres, RIA had in the past advertised in the national press for expressions of interest from persons interested in providing accommodation and other ancillary services for asylum seekers.  That procurement process was subject to scrutiny in the Value For Money (VFM) review in respect of spending by RIA on asylum seeker accommodation which was published in May, 2010. A copy of this review is in the Oireachtas Library and is also viewable on the RIA website: www.ria.gov.ie.  The Review acknowledged the unique challenges in this particular area of procurement, e.g. the unpredictability of demand, the requirement to disperse asylum seekers around the country, local opposition to the opening of new centres, children settled in schools and so on.  Among the recommendations of the VFM report was the introduction of a mix of ‘contracts for capacity’ and ‘contracts for availability and occupancy’ as well as a ‘more open’ tendering system in respect of the commercially owned and operated centres in the RIA portfolio.   The completion of the tender competition last year in respect of the management of the State owned centres enabled RIA to begin preparatory work, now well underway, on devising a more open tendering process for the commercially owned centres. As an interim measure, existing contracts are being carried over on short term bases. The contracts, as far as practicable, have introduced a number of elements recommended in the VFM report, for example, contracts involve a mix of ‘contracts for capacity’ and ‘contracts for availability and occupancy’ which have the dual purpose of maximising the occupancy of the centre while minimising RIA’s expenditure. The task of devising a long term ‘open’ tender process is a difficult exercise as it has to take account of “non-money” issues such as access to social, educational and health services; adherence to long standing Government policy on dispersal of asylum seekers; as well as a recognition that other State agencies may have already committed resources in a particular region or area.   It is worth noting generally the decline in the number of persons seeking accommodation in the RIA system in recent years which has necessitated the consolidation of the accommodation portfolio.  At the end of 2008, RIA was accommodating 7002 persons in 60 centres.  At the end of 2012 RIA was accommodating 4,841 persons in 35 centres. During that 4 year period RIA had closed 25 centres and was accommodating 2,161 fewer persons. In that same period, spending on the RIA system declined from €91.5 million to €62.3 million i.e.32%.