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Bringing public sector contracts within reach for SMEs

winners_cup_Plans to make it simpler and easier for smaller businesses to bid for and win work across the entire public sector were announced by Cabinet Office minister Chloë Smith yesterday.

Accounting for 99.9% of the UK’s 4.5 million businesses, Small and medium enterprises (SMEs) are a crucial engine for growth.

With £230 billion per year spent on goods and services right across the whole public sector, Government wants to help SMEs to compete for and win this business by creating a SME-friendly ‘single market’ for public procurement.

Suppliers who want to do business with the public sector will be able to expect all organisations to follow a single set of principles when buying goods and services. The proposals will simplify and standardise how public contracts are advertised, bid for and paid for across the public sector.

The minister has also written to MPs, asking them to approach their local authorities to make sure they are doing everything possible to support SMEs and ask them to publish their contract opportunities on the Government’s Contracts Finder website.

Chloë Smith, said:

“Historically SMEs have been shut out of government business. In the past bidding for public sector contracts was time-consuming, expensive and overly bureaucratic.

“Removing barriers and setting out a consistent, single set of SME-friendly principles for the whole public sector will provide the right support to encourage significant business and growth opportunities for SMEs, and help give the UK a better starting position in the global race.”

The consultation proposals include:

  • Introducing a requirement for all public sector contracts over £10,000 to be accessible on the same site;
  • Banning burdensome pre-qualification questionnaires for low value public sector contracts, and introducing a single standardised requirement for high value contracts; and
  • Ensuring suppliers further down the supply chain benefit from the same standard payment terms that public bodies offer prime contractors to ensure prompt payment for public sector work.


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