UK Budget – good news for small business, procurement contribution needed!

The UK government budget statement yesterday was arguably over-shadowed by the continuing uncertainty in Cyprus. The implications of that fiasco are likely to have a far greater effect on western economies – including that of the UK – than the changes announced by George Osborne in the UK parliament.

However, there were a few moves of interest to the public sector procurement community. In particular, there are further initiatives to support small businesses (SMEs).

There is a commitment to expand the Small Business Research Initiative, where businesses compete to develop new solutions to public sector challenges. Public bodies can advertise their challenges and get responses from business – the current funding is around £40 Million a year but the aim is to fund more than £100 million of contracts in 2013-14 and more than £200 million in 2014-15.

There is also (according to some reports) a move to support SMEs bidding for government contracts. I haven't found anything very specific about that, so it may be it is just a potential aspect of the Growth Vouchers idea. As the Treasury says:

“The Government will provide £30 million for an SME Growth Vouchers programme in England to test a variety of approaches to help SMEs overcome barriers to achieving growth”.

Not quite sure what this means – it seems to be vouchers that SMEs can use to get business advice? And that might include advice on bidding I guess.

Of course the other over-riding point for public sector buyers is simply that “austerity” is going to continue for years to come as the financial projections for the UK were revised downwards yet again. So the good news is perhaps that there is continuing and perhaps increasing scope for procurement to show what it can do to contribute during tough times. The bad news for our colleagues in that sector is a continued pressure on public sector salaries, and a generally tough environment with pressure on headcount and costs continuing.

And if you really want to worry about the UK economy, read this excellent analysis by Fraser Nelson – a Conservative himself – looking at the numbers behind the current situation.


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