Government must focus on SMEs to fulfil procurement commitment

When techUK published its fourth annual Govtech SME Survey, it offered insights into the challenges…...

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When techUK published its fourth annual Govtech SME Survey, it offered insights into the challenges that small or medium-sized enterprises (SMEs) face when fulfilling public sector procurement contracts. The UK government had committed to spending 33% of public sector procurement funds to source goods and services from SMEs by 2022. However, this target may not be achievable as SMEs still face challenges when collaborating with the public sector. Nonetheless, the government had made major strides to bring SMEs into the fold of public procurement by launching the G-Cloud framework in 2012, but more still has to be done.

The government’s data shows that until 31 December 2017 when the G-Cloud framework was launched, the total sales value offered to SMEs stood at 48%. The figure seems impressive, although when compared to the sales value from 2012 to until 31 December 2016, the spend has reduced. For the previous year, the spend was 56%. Independent analysis shows that in the last three years, only 8% sales value has been offered to SMEs.

The techUK report shows that 92% of SMEs would prefer to work with the private sector than the government as they are finding it impossible to win contracts. The report provides some recommendations to help the government improve access of SMEs to the public sector market. It suggests that government agencies and departments should procure through the Digital Marketplace, which has a complex process. By simplifying the process of using the marketplace, it will encourage the public sector to use it and help SMEs win contracts.

The report also recommends that government institutions and agencies adopt a more strategic approach to engage industries and companies outside the procurement cycle. To enable this, the government should introduce Innovation Showcase to highlight the government’s technology innovations. SMEs can help the public sector digitise fast, and once the government realises this, it will mobilise innovation and ensure SMEs are awarded contracts.

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