Government opens up contracts to SMEs

The Prime Minister and Cabinet Office minister have today unveiled a wide raft of reforms aimed at opening doors to greater procurement opportunities for small and medium-sized businesses (SMEs).

At the core of the reforms announced is the appointment of SME veteran Stephen Allott as Crown Commercial Representative (CCR) for SMEs, tasked with a key objective of building a more strategic dialogue between the government and smaller suppliers. SME product surgeries allowing businesses to pitch products and services to senior public sector procurement professionals are to be led by Allott in his new role.

The first phase of a new online service, Contracts Finder, hasalso launched today. The site - hosted via Business Link - features public sector contract opportunities over £10,000, and it's claimed to make the procurement process by the government "totally transparent". Coupled with Contracts Finder is the new approach the government says it is taking towards assessing companies and organisations looking to work with Whitehall. Documents from the Cabinet Office have revealed government departments will be required to publish a set of targeted actions to increase business with SMEs from March.

A double-pronged strategy is being made, with the government confirming it will seek to eliminate Pre-Qualification Questionnaires for call central government procurements under £100,000. The measure has been described by the Cabinet Office as "a radical change in the way pre-qualification is carried out". The second part of the strategy will allow firms to submit pre-qualification data once for all procurements in common commodities. It's hoped the move will put an end to companies having to submit the same data "time and time again," not only saving time and money for suppliers but for government too.

The measures coincided with the publication of the Cabinet Office's LEAN Review into the government's procurement processes, which concluded radical changes are needed in a number of areas, including, "the approach to planning procurements, the upskilling of procurement and commercial professionals, the allocation of resources to complex procurement projects, and the effective sharing of best practices across government departments".

"Today we are announcing big changes to the way government does business," said David Cameron. "It will provide billions of pounds worth of new business opportunities for small and medium-sized enterprises, charities and social enterprises. We need to make the system more open to new providers, more competitive between suppliers and more transparent for the taxpayer. This is vital as we get to grip with our deficit - helping us tackle waste, control public spending and boost enterprise and growth."

"It will also help modernise our public services, opening them up to the forces of competition and innovation and give our great charities and social enterprises the opportunity to deliver services too," he added. "I call on all those who think they can provide a great service for government, to take advantage of these opportunities, to go online and start searching for contracts now."

Cameron told procurement managers he wanted them to feel empowered: "If you follow the rules, I will stand by you if you take risks with young, dynamic companies."

"These changes will help to light the fire of enterprise in our country by providing billions of pounds of opportunities for SMEs," said. "They are also important to building the Big Society by giving charities and social enterprises the chance to deliver services."

Minister for the Cabinet Office, Francis Maude, said the measures and reformed detailed by the launch marked the end of "the procurement oligopoly - where innovative small businesses and organisations are too often shut out of contract processes early on because of ridiculous rules and unnecessary bureaucracy. This is not only bad for those affected; it's also bad for Government as it stifles competition."

"Today's changes will help create a system which is transparent and allows small businesses and voluntary sector organisations to compete more fairly for Government contracts - helping to drive economic growth at national and regional level, while delivering better deals for the taxpayer," Maude added. 

The Cabinet Office minister defended the launch, and stated it was not just "another random government announcement".

"If we make this work, what are we doing? We are supporting growth, enterprise, dynamism and employment in our economy," he said. "You've been very clear that you believe procurement managers aren't commercial enough so we want to encourage them to be less risk averse."