Government procurement “opens up contracts to small business”

As expected, there have been major announcements today; and fair to say, more extensive and wide ranging than I or most people expected. It does appear to be a package of measures aimed at genuinely making a difference to SMEs bidding for Government work.  I have my doubts about one or two of the ideas; and it's going to take some time to digest them all, but it looks like a good mix of some old ideas revisited and a few that are totally new to me.  Here is the announcement, but if you look at the list of detailed documents, you can see that there is a lot of content sitting behind the headlines.

A few immediate thoughts. The appointment of a 'Crown Commercial Representative' (Stephen Allott) for SMEs is an interesting move, and he has an impressive background.  'Product surgeries' could be useful but SMEs will need to see outcomes or they will quickly be labelled as talking shops.  Allowing suppliers to submit a single PQQ (at commodity level) is great as long as it is managed well.

On the less positive side, I would like to understand more about the idea of eliminating PQQs for lower value contracts; and encouraging the use of the EU 'Open' procedure for higher value contracts is something that does not seem particularly workable based on my experience.  I'd like to get an informed Cabinet Office view on how they see that being effective (rather than creating more work for bidders and buyers which is my initial view).

So we will come back to this lot next week I'm sure and comment further; but well done to the team involved with this in Cabinet Office. It's an impressive package and good to see you've got Ministerial interest in this challenging but very important area.

Voices (3)

  1. T:

    Not the first time I hear the “Powers” encourage the Open procedure to help SMEs.
    I am the advocate of the opposite and agree with your article in questioning – How will it help? At least in the restricted procedure you just waste a bit of time on the PQQ and if selected know that you are in a closed, limited number of people group (around 10, often 5) and in with a good shot. As a consequence worth spending some time putting the bid together.
    In the Open procedure, you have to do your bid with a chance in whatever number of people taking part (sometimes a hundred). What a waste of time and energy of potentially loads of SMEs.

    This pushing the Open Procedure idea is unfortunately in the head of quite a few people, and I am sorry to say that I am not sure about their logic in thinking that it helps SMEs. Maybe in some countries it works? In Sweden most of the tenders are issued under the Open Procedure. Have they got more SMEs applying and being successful? My guess is probably yes.
    Is it because of the Open Procedure or because the tenders have to be in Swedish, most companies in Sweden are Small and the numbers of tenders and suppliers are limited…
    In the UK, the tenders are in English and the grasp of English compared to the grasp of Swedish by companies is slightly more developed throughout Europe. As well we are not speaking about the same numbers of companies…

    As for the 25% target. If you refer to the SpikeCavells spotlight on spend website (nice one by the way), you will see that the Authorities registered there are already pretty much all above the 25% target, way above for some of them.

    Finally ContractsFinder has a very nice look and feel to it. From what i understand though, it is just for Central Government. The Local Authorities will probably be invited to join at some point. How many will do?

    On a more positive note, there are some good ideas, and I am looking forward to see how things develop.

  2. Paul Seddon:

    Peter

    That’s an interesting and, I would say, balanced assessment on these important announcements. There is a body of material to read here. When you couple this with the EU Green Paper on reform to the public and utilities sectors procurement regimes, we have our work cut out to understand and influence how public procurement will be shaped in the future.

    I still see a basic contradiction between the centralisation of Central Government procurement – with a (possibly unfair) presumption that this will mean larger lots suitable only for larger suppliers – and the aspiration of 25% of supply from SMEs. Given that contradiction, I would reserve judgement on whether in practice the changes proposed will make much difference to the share of public supply taken SMEs.

    To the extent that the Cabinet Office is focusing on process improvement, then there is the prospect of reduced costs of public tenders for both sides, which must be positive. Again, though, process change is one thing, changing the risk-averse culture of public buyers is quite another. In de-regulating in one way (losing PQQs for low value awards) then it is perfectly possible for the Civil Service to invent another set of rules and/or procedures to restore their comfort level and frustrate the object of de-regulation.

    I hope I am being overly sceptical, but I feel that experience says wait for the detail and keep vigilant!

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