FSB welcomes better deal on procurement

Following on from this week’s Pre-Budget Report, a review conducted by venture capitalist Anne Glover looking into government procurement has been released.  Its aim is to make it easier for small businesses to access government contracts.

Only 16% of the £175 billion worth of public sector contracts go to SMEs.  The Glover Report therefore makes it clear that:

• there need to be better channels of communication between small firms and government;
• the process of tendering for public sector contracts should be made simpler and more transparent;
• SMEs need better and fairer access to these opportunities.

The Federation of Small Businesses, however, calls for more radical reforms in the light of the current economic climate.

It suggests, for example, setting a £500,000 turnover limit on businesses that can apply for low value tenders, thereby helping to distribute contracts more evenly.

It also calls for a target of 30% of public sector contracts to be awarded to SMEs.

It’s difficult to say whether this kind of positive discrimination will work in practice.  What is clear is smaller companies can often provide a service at least as good, if not better, than larger corporates, if only they are given a fair crack of the whip.

[Picture credit: joebeone licenced from Flickr]