Irish firms could lose up to €8bn in Government tenders

Some €90bn will be procured over the next five years

Irish firms could lose up to €8bn in Government tenders

A counterfeit money expert of the German Federal Bank holds new twenty euro banknotes | Image: Jens Meyer / AP/Press Association Images

A consultancy firm has warned up to €8bn of Irish Government tenders are at risk of being won by overseas companies.

Bid Management Services say domestic firms need to become more professional to win big contracts.

It says 'leakage' of domestic procurement contracts to other EU states is normally under 2%.

However, in Ireland the rate stands at 11% - more than five times higher.

Some €90on in supplies, services and works will be procured in Ireland and Northern Ireland over the next five years.

However according to Peter Brennan, chairman of Bid Management Services, contracts may be won by overseas companies because indigenous firms do not tender either aggressively or professionally enough.

"Irish SMEs badly to need to up-skill to prevent non-Irish companies getting a significant share of the Irish procurement market. Irish companies have no automatic 'right' to win Government contracts and in too many instances that we have seen, indigenous companies have lost out because of the poor quality of their tenders," he said.

"What we call 'leakage' of procurement contracts to firms in other EU Member States is normally under 2%. However, in Ireland the leakage rate at 11% is far too high."

"We need to reverse the trend of transferring a significant proportion of Government expenditure outside the State with a resultant loss in Exchequer revenue and jobs," he added.

The tender and procurement consultancy firm surveyed its clients and found nearly 90% have a win rate of less than one in four.

It also found that 75% of tenders won were valued at less than €100,000; while the main barriers to tendering are public bodies' resistance to providing a de-briefing, and badly defined technical specifications.