LAWYERS WILL have to compete on price when working for public bodies under rules being introduced this month to cut the State’s €500 million a year bill for legal work.
Advertising and public tenders should be “the norm” when contracts are being awarded, the Department of Public Expenditure and Reform will tell public bodies in a circular to be issued next month.
The department has been engaging with the law offices of other Government departments and public bodies with the aim of cutting costs by reducing fees and increasing competition among lawyers, according to a spokeswoman.
However, the Government’s decision to rely on guidelines rather than make competitive tendering legally binding has been criticised by Labour backbencher Anne Ferris, who said that while the circular is welcome it does not place statutory obligations on public bodies.
Ms Ferris warned that public bodies may choose not to follow voluntary guidelines. Most local authorities ignored the recommendations of a similar circular on the proper procurement of legal services from the Department of the Environment last year, she said.
A report published by the Public Accounts Committee last year found there was very little competitive tendering for solicitors’ legal services by public bodies and none at all for barristers’ legal services.
Unlike many other services that are subject to strict rules on tendering, legal services are listed as a non-priority service under EU public procurement directives. This has resulted in many public bodies excusing themselves from running competitive tendering processes for legal services, according to Ms Ferris.
The report found that the current practice is for State agencies to seek discounts when instructing a limited pool of private practitioners and to claim value for money when this is obtained. In reality, however, the fees are billed high in the expectation that a discount will be sought and granted.
It recommended that competitive tendering should be made mandatory for the procurement of solicitors’ and barristers’ services by the State to ensure better service and value for public bodies.
The reform of the legal profession and other sheltered sectors is being driven by pressure from the troika funding Ireland’s bailout, who have called for the implementation of Competition Authority recommendations aimed at reducing costs. One of its recommendations was for the identification of legal services purchased by the State where competitive tendering would be “an appropriate form of procurement”.
The Legal Services Regulatory Bill currently before the Oireachtas provides for sweeping changes in the regulation of the profession but is silent on tendering practices.
Ms Ferris said this is a mistake and has called for the Bill to be amended.
“The Bill provides the best and possibly only opportunity in national legislation to address this current procurement practice anomaly and provide for mandatory competitive tendering,” she said.
A spokeswoman for Minister for Justice Alan Shatter, who is steering the Bill through the Oireachtas, said the Department of Public Expenditure was responsible for public tendering issues.
Fianna Fáil justice spokesman Dara Calleary yesterday called on Mr Shatter to address legitimate concerns about the Bill, particularly in relation to the control it gives the Government over the profession.
“Under Minister Shatter’s Bill, the Minister for Justice and his department will be central to every activity of the legal sector in this country. Minister Shatter cannot continue to ignore the seriousness of this,” said Mr Calleary.