Council Doesn’t Follow Normal Procurement Process to

The Dublin Region Homeless Executive (DRHE) is looking to roll-out more homeless hostels in the city.

“We are interested in talking to landlords and property owners about properties that can be used as family hubs or hostels for single persons,” says a press release issued by the council on 28 January.

But Dublin city councillors and a TD are concerned about the way the DRHE is going about it.

Not just because it is seeking private landlords rather than charities, but also because it’s not following the procurement process that would usually apply when government bodies spend large amounts of money, skirting rules that are in place to make sure it’s all fair and open.

Independent Councillor Anthony Flynn says he has been railing against the lack of transparency around DRHE’s procurement for at least two years.

“You are talking about hundreds of millions of euros,” says Flynn, who is also CEO of the charity Inner City Helping Homeless. “I do think the Public Accounts Committee has a role to play in scrutinising these accounts.”

A spokesperson for Dublin City Council said that getting homeless accommodation providers is complex.

It is looking for a specialist consultant to advise it on how to source this kind of accommodation in compliance with public procurement rules, they said.

An open competition for all publicly funded contracts would be better than the current way, says Louisa Santoro, the CEO of the Mendicity Institution, a homeless day centre.

Some other funding bodies occasionally advertise grants that homeless charities can apply for, but DRHE is the main funder for homeless services, says Santoro.

“It is disheartening that there isn’t a transparent funding mechanism,” she says.

Flynn, the independent councillor, says it is unfair to private companies that don’t get a look in too as all should get a shot at competing.

Last year, a catering company got a contract for meals in some hostels, but the opportunity was never publicly advertised as far as he is aware, he says.

He asks why that wasn’t a normal, open competition. “This is taxpayers’ money,” he says. “There needs to be an independent audit of the sector.”

A spokesperson for the Department of Housing said that decisions around homeless services, contracts and procurement “are a matter for individual (local) authorities”.

Councils have to make sure they comply with all relevant statutory obligations, they said.

Public procurement is governed by EU and national rules, says a spokesperson for the Department of Public Expenditure and Reform.

“The aim of these rules is to promote an open, competitive and non-discriminatory public procurement regime which delivers best value for money,” they said.

Public bodies have to advertise contracts for supplies and services worth more than €25,000 on eTenders, the national tendering platform, they said.

There can be legitimate reasons for awarding contracts without that competitive process, they said. “Such as extreme urgency brought about by unforeseeable events or where there is a single supplier to perform the contract.”

Government departments must report contracts over €25,000 that are awarded without a competitive process to the Comptroller and Auditor General, they said.

The DRHE spent €170m on accommodation and support services in 2019.

Between 2015 and 2020, the DRHE advertised three contracts, a search on eTenders suggests.

One was for construction works on hostels in 2017, and another was for a booking system in 2019.

The only contract for accommodation or support services was for the Housing First service, which aims to get those who have been sleeping rough long-term into homes.

A spokesperson for DRHE said that together with the Dublin City Council procurement unit it commissioned a report in 2017 on the procurement of emergency accommodation.

“The report highlighted the complexities and risks associated with the procurement process, (open or restrictive), for the provision of temporary emergency accommodation,” says the spokesperson.

Since then, the DRHE has struggled to source accommodation and when it approached commercial operators they were often “unwilling to undertake the operational demands necessary to accommodate families and single adults”.

So instead they placed ads in the media seeking commercial operators, says the spokesperson.

It’s worrying that the NGO sector appears excluded from the current call for new hostels, says Flynn, the independent councillor.

Standards of care in homeless services are dropping as more contracts seem to be going to private providers, he says.

The DRHE said in November that half of all single homeless people, around 1,500 people, are in private hostels.

Despite how widespread Covid-19 is in the community, the DRHE has placed five or six people to a room in some private hostels recently, says Flynn.

Privatising hostels incentivises overcrowding, he says. “The more people they squeeze in the more money they make.”

Social Democrats TD and housing spokesperson Cian O’Callaghan said: “It is really concerning that the DHRE is advertising for providers of emergency accommodation but appears to be excluding not-for-profit NGOs from the tendering process.”

NGOs have a track record of providing support and higher standards and are geared towards helping people to exit homelessness, he says.

“We really need a robust and transparent system of independent inspections headed up by HIQA,” he says.

A spokesperson for Dublin Region Homeless Executive says that “it is the intention of the DRHE that quality standards will apply to all accommodation i.e. both privately operated and NGO operated”.

But it is not currently the case.

The council’s housing manager Brendan Kenny said recently that most homeless people accommodated in private hostels don’t have a support plan.

Green Party Councillor Janet Horner said that the council should be recruiting for homeless providers that provide care and support for vulnerable people and that meet the national quality standards framework laid down for the sector.

“Both the DRHE and the Minister have said that the increased use of private emergency accommodation in recent years has been a response to both crises of homelessness and COVID,” she says.

“But now that we are moving out of the emergency response phase, why are we still seeking new private emergency accommodation?” she said.

The spokesperson for the DRHE said it is also in discussions with homeless charities, but didn’t say why it doesn’t publicly advertise those contracts.

Horner asked council officials what the process is for awarding contracts for emergency accommodation and whether an open, competitive public procurement process applies.

John Durkan, deputy director of the DRHE, said it is currently advertising to seek “expressions of interest from commercial operators to work with the DRHE to provide temporary emergency accommodation”.

“The commercial operators, provide confirmation of title, a risk assessment from a competent fire consultant and commit to carrying out any necessary works, at their own expense,” he said.

The Dublin City Council Chief Valuer’s office will then negotiate the contract, he said

Local residents have objected to hostels in Dublin 1, 2, 6, 7 and 8. Objections “can result in this being a difficult, arduous and precarious business for any commercial operator to enter”, says Durkan.

The council’s procurement unit “is working on commissioning a specialist consultant to examine the complexities on sourcing emergency accommodation and how best the DRHE can undertake a public procurement process to this type of accommodation”, he said.