§ Mrs. RocheTo ask the Secretary of State for Northern Ireland what is his Department's policy on the use of performance bonds; in what circumstances they are used; what was the total sum paid by bond in each of the last five years; and if his Department requires bonds from businesses with fewer than(a) 100, (b) 50 and (c) 20 employees. [29500]
§ Sir John Wheeler[holding answer 20 May 1996]The Northern Ireland Office and Nortern Ireland Departments' policy on the use of performance bonds is in accordance with HM Treasury central unit on procurement's guidance on bonds and guarantees.
The potential exists for demanding performance bonds in the allocation of construction contracts. The facility has been used by the Department of the Environment's roads service, which requests performance bonds for all contracts costing £200,000 or more which are awarded by open contract. For contracts less than £200,000, bonds may be requested where there is concern about the capacity of the lowest tenderers to perform the contracts. The roads service has had no occasion to receive payments by bond in the last five years.
The number of staff employed by businesses is not a factor in deciding whether a bond is necessary.