Existing procurement processed will be simplified, helping UK startups secure previously unobtainable public sector contracts, driving regional growth.
Government departments currently spent around £400billion each year on essential goods and services. However, a number of obstacles have been identified which often stand in the way of smaller firms competing against larger national and multinational companies with far more resources.
These include inability to endure lengthy procurement processes which require significant investment. Upscaling to meet the level of demand regional authorities is also a significant issue. The result means that larger suppliers usually dominate government contracts, stifling British startup culture and, in turn, potentially innovation.
In addition to expediting procurement processes, the National Procurement Policy Statement also stipulates a new requirement for any firm awarded a public sector contract to advertise any jobs created in job centres. The belief is this will ensure unemployed people will be more likely to apply for opportunities and vacancies in sectors such as tech will feature in back-to-work programmes.
‘Businesses tell me that the current system isn’t working. It is slow, complicated and too often means small businesses in this country are shut out of public sector contracts,’ said Georgia Gould, Parliamentary Secretary at the Cabinet Office. ‘These measures will change that, giving them greater opportunity to access the £400 billion spent on public procurement every year, investing in home grown talent and driving innovation and growth.’
‘This new policy statement sets out our vision for how procurement can put this country back into the service of working people, and deliver our Plan for Change – by making sure the public sector is committed to growing the economy and empowering our communities with innovation and opportunity,’ she continued.
Up until now, Social Value measures are needed for all public sector contracts, meaning businesses help bring forward positive change in their local communities and the UK as a whole. However, the rules around how this is judged often differ between areas, leading to widespread confusion, particularly among businesses. This regularly leads to firms failing to deliver on commitments because of the lack of clarity.
Meanwhile, a new Digital Commercial Centre of Excellence is also being established. Falling under the Department for Science, Innovation and Technology, this entity will enforce a ‘buy once and well’ approach, stopping the likelihood of two different public sector teams procuring separate products for the same or similar tasks, and therefore the need to train staff on two products to maintain services. By buying ‘one for all’, expenditure will fall, as will the time it takes to upskill team members.
‘There is a £45 billion jackpot of potential productivity savings if we make full use of technology across our public services, it is not an opportunity we can miss,’ said AI and Digital Government Minister Feryal Clark. ‘To get this right, we need to make sure public sector organisations can get their hands on the right technology for them, quickly. That’s why our Digital Commercial Centre of Excellence will help the rest of the public sector invest in long-term solutions and stop hasty quick fixes.’
A new Register for Framework agreements is being produce to help identify ‘rip-off contacts’ from third party providers that catch out organisations with hidden fees and charges. According to the National Audit Office, there are between 8,000 and 12,000 frameworks available, and many are not transparent by design.
Finally, a Commercial Innovation Hub may be created, too, which will be a ‘golden link’ across all government departments and sharing learnings from ‘extraordinary events’. For example, Covid-19 vaccine procurement. This will help teams utilise the full extend all new powers offered by the Procurement Act’s increased flexibility.
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Image Cytonn Photography / Unsplash
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