Partner Article

Public Procurement gets easier for SMEs

This week’s Government announcement that it will reform the public procurement system has been welcomed by the Forum of Private Business.

Cabinet minister Francis Maude revealed the ‘radical reform’ that will take place to allow SMEs easier access to lucrative state-funded contracts, worth around £230 billion a year.

The changes will include the publication of £50 billion contracts via a new website, and improved collaboration with businesses in the early stages of the procurement process.

For the most complex procurement processes Government have pledged to reduce the timescale to 120 days, a scaling down of 80 days.

Phil Orford, the Forum’s chief executive, said: “With a budget of around £230 billion a year, the state remains the single biggest source of work for UK business.

“Encouraging smaller firms to compete for access to Government contracts is something we have long campaigned for, and, if successful, should provide a vital source of new income for smaller firms in to the future as the UK economy grows.”

The announcement comes ahead of new week’s Autumn Statement, by George Osbourne, which is expected set out a raft of large public infrastructure projects.

Funding will be set out for some 40 projects which are likely to be the first real opportunity for small firms to try out the reformed public procurement process.

Added Mr Orford: “This will be an important announcement as it could well help create the business growth and jobs in the new year to allow a real private-sector-led recovery which the Government has been calling for.

“It will be a real test of how streamlined the new procurement system is and if it will actually make any difference to SMEs.

“Less red tape, less form filling, and a quicker decision on the actual outcome of tendering should also drive down costs and should mean the public are getting better value for money at a time when Government is demanding best value as part of its austerity measures.

“The Forum does hope, however, that if government increases the number of small business on their books they prioritise the need to pay promptly.

“Big business may well be able to absorb late payments weeks past the invoice date, in some cases months, but for small business it can be a terminal blow.”

This was posted in Bdaily's Members' News section by Tom Keighley .