August 16, 2013 - Rachel Miller

SMEs getting more contracts from Government

New figures show that initiatives aimed at increasing the amount of central Government procurement from SMEs is on track.

The figures published in a "two-years on" progress report – Making government business more accessible to SMEs – show that the Government is on its way to delivering its aspiration of awarding 25% of central Government business to SMEs by 2015, both directly and through the supply chain.

All Government departments have developed plans for making contributions to the 25% aspiration, and every department now has an appointed SME minister to ensure SME-friendly procurement practices are commonplace.

This has resulted in spend steadily increasing. In 2009-10, just 6.5% of central Government's direct procurement spend went to SMEs.

The latest figures show that direct SME spend has increased from £3 billion in 2009-10 to £4.5 billion (10.5%) in 2012-13. In addition, new figures provided by major Government suppliers indicate that SMEs have also benefited from a further £4 billion (9.4%) in indirect spend through the supply chain for 2012-13.

"SMEs have historically been shut out of Government business," said Chloe Smith MP, minister for political and constitutional reform. "Smaller firms have found bidding for public sector work excessively bureaucratic, time-consuming and expensive. This meant that the tax payer has not always benefited from some of the best and most cost-effective ideas that SMEs are capable of delivering."

According to Smith, there is now "much greater visibility of opportunities for SMEs via our Contracts Finder website – a single place to view what is on offer." In addition, the Government's Mystery Shopper Service allows suppliers to report instances of poor practice across the public sector that the Cabinet Office investigates – and 80% of these cases have resulted in a positive outcome.

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