Government Contracts: Small Businesses

Answer from Julia Lopez

The UK spends £290 billion on public procurement each year. Now that we have left the EU transition period, we aim to make it simpler, quicker and cheaper for small and medium-sized enterprises and social enterprises to bid for Government contracts, as set out in our ambitious procurement Green Paper. We have already introduced a policy that will allow below-threshold contracts to be reserved for smaller UK suppliers, and we hope our new approach to social value will secure wider public benefit by allowing us to contract with firms that deliver more apprenticeships, local growth opportunities and environmental benefits.

Answer from Julia Lopez

I agree with my hon. Friend that the opportunities in this space are huge, and we think that our reforms will play a huge role in our post-covid recovery. For too long, complex and opaque procurement rules have benefited bigger and less innovative firms. Our reforms will simplify the current framework of over 350 regulations into one uniform set of rules, and move from seven procurement procedures to three. Our free-to-use digital platform, Contracts Finder, should make it easier for businesses in his constituency to find relevant opportunities. We want to make supply registration far simpler, so that data has to be submitted only once to qualify for any public sector procurement.

Answer from Julia Lopez

Absolutely. I know that my hon. Friend, as someone who has run a business herself, understands the bureaucratic frustrations that too many of her constituency businesses come up against. We want public buyers to divide contracts into more accessible lots and allow them to reserve contracts under a certain threshold for small, innovative firms. We are also pushing ambitious targets on prompt payment, and we aim to simplify the bidding process so that it does not favour big firms, which inevitably have greater resources to devote to form-filling and box-ticking.

Answer from Julia Lopez

My hon. Friend is quite right. Our proposed procurement reforms will not in themselves deliver change unless commercial teams across the public sector actually understand how to deploy them to greatest effect. That is why we are introducing a programme of training for contracting authorities. On the matter of wider public benefit, I refer him to our social value model. We do not want to award only to those that make the cheapest bid; we also want to award to firms that offer value for money in a much broader sense, including to the community in which the service is being delivered.

Answer from Julia Lopez

I thank my hon. Friend for highlighting this; she raises an important point. I am happy to look into the specifics of the case and take it up with officials, or she might want to look at the public procurement review service. All Departments, including the MOD, are actively supporting the SME agenda, and one of the ways we hope to encourage more bids from SMEs is by publishing contract pipelines well in advance, so that they have much more time to plan and resource bids, and shorten the time in which contracting bodies make decisions.