New UK Procurement Rules to Help SMEs 

New UK procurement guidelines have turn into legislation right this moment, aiming to ship less complicated, more practical public sector procurement and serving to SMEs entry a higher share of roughly £300bn of expenditure per 12 months.

Procurement is the method of discovering, acquiring and securing items or providers an organization must function successfully.

The Procurement Act will set up a brand new public procurement regime following the UK’s exit from the EU. It goals to help progress within the economic system by creating a less complicated and extra clear system that reduces prices for companies.

The brand new guidelines will even defend SMEs towards nationwide safety dangers in public contracts.

Excessive-risk suppliers can be placed on a public debarment listing and prevented from bidding for some classes of products or providers – equivalent to areas associated to defence and nationwide safety – whereas permitting them to proceed to bid for contracts in non-sensitive areas.

“This Act is all about supporting British enterprise utilizing the chance of Brexit, as we alter the best way [the] authorities works so it delivers higher for folks throughout the nation,” says Alex Burghart, parliamentary secretary for the Cupboard Workplace.

“Specifically, we draw on the brand new freedoms obtainable to us by leaving the European Union to embrace and greatest help our small and medium sized companies.”

A shift in strategy

The brand new Act guarantees to streamline the best way that firms bid for public contracts and provides procurers extra room for negotiating costs and modern options with these firms.

It can even be potential to exclude suppliers from bidding for contracts – not provided that they’ve carried out badly on different contracts up to now, but additionally primarily based on trendy slavery or skilled misconduct grounds.

The Act additionally introduces a brand new responsibility for ministers to proactively contemplate suppliers for potential debarment investigations.

To realize this, the federal government will introduce a brand new Nationwide Safety Unit for Procurement – the unit’s purpose is to guard folks throughout the nation by investigating suppliers who might pose a threat to nationwide safety, and assess whether or not firms needs to be barred from public procurements.

Contracting authorities might want to take account of the nationwide strategic priorities set out within the Nationwide Procurement Coverage Assertion – examples embrace job creation, enhancing provider resilience and fostering innovation.

The adjustments of the Act are anticipated to return into pressure as soon as secondary laws is authorised and after a six-month implementation interval concludes.

Is it sufficient?

The Procurement Act is a step in the precise route, however will it obtain sufficient to fulfill targets which are already years late?

In a report revealed by the Nationwide Audit Workplace (NAO) in 2016, the federal government set a goal for 33% of spending to succeed in SMEs by 2020. Regardless of these ambitions, in 2023 – three years later than its goal 12 months of 2020 – authorities spending in SMEs continues to be falling wanting its seven-year-old goal of 33%.

In 2020/21, a breakdown of departmental spending confirmed that 26.9% of complete spend went to SMEs – and within the monetary 12 months 2021/22, this determine truly decreased to 26.5%. For the latter, 14.1% lined oblique spending and simply 12.3% was direct.

It’s crucial that the federal government continues to speak with SME leaders to make sure future laws helps their struggles – particularly because the influence of Brexit rumbles on.

Related content material 

Working with authorities: a information for small companies
New authorities measures deal with late funds to SMEs