PARLIAMENTARY DEBATE
Government Contracts: Small Businesses - 25 March 2021 (Commons/Commons Chamber)

Each year, the Government spend some £290 billion on public procurement. Now that the EU transition period has ended, we aim to make it simpler, quicker and cheaper for small and medium-sized enterprises to bid for Government contracts, as set out in our ambitious procurement Green Paper. We received over 600 responses to that consultation and the submission from the Federation of Small Businesses welcomed our drive to simplify and diversify public procurement.

Across Keighley and Ilkley, we have some of the finest small to medium-sized businesses which are passionate about the products they produce and the services they offer. Many are hungry for growth and expansion opportunities—I think of Wyedean Weaving, which is based in the Worth Valley. However, sometimes small businesses feel disadvantaged in comparison to larger businesses when it comes to bidding and being selected for Government contracts. Can my hon. Friend outline what her Department is doing to ensure that there is no disparity in the process and that small businesses have just as much chance of being selected as larger businesses?

I thank my hon. Friend for his question, and I know that businesses in Keighley will really appreciate what a great champion he is for their interests. We are doing a range of things within our new measures. We want to slash 350-plus regulations and put this into a single uniform framework. We want to do things such as reserve contracts below a certain threshold for SMEs, be able to discriminate by virtue of geography and divide contracts up into smaller lots. There is much more that I can talk to him about if he is interested in this subject.

I thank my hon. Friend for her response. Alongside wonderful small businesses, does the Cabinet Office also look at venture capital companies to enable Government Departments to have the opportunity to support and benefit from our brilliant, innovative venture businesses?

We are looking all the time at how we innovate in public procurement. Some of my hon. Friend’s query might be better addressed by the Department for Business, Energy and Industrial Strategy or Her Majesty’s Treasury, but we hope that the improvements that we are proposing will open up many more opportunities to SMEs. She might also be interested in existing programmes such as the small business research initiative, which funds organisations to conduct challenge-based R&D to develop products or services that address a specific unmet public sector need.

I thank the Minister for her response. May I invite her to come and visit Carshalton and Wallington post pandemic to meet some of the small and medium-sized businesses that are keen to bid for Government contracts, to hear their concerns about the process and to encourage more to look at opportunities to do so?

I would be very happy to do so. My hon. Friend understands that the Government have tremendous buying power, which we think we can use to drive the recovery. We want to use our procurement reforms to open up many more opportunities to SMEs. We are doing that in a range of ways, which I have discussed, but we also have a new social value model, which explicitly allows greater weight to be given to those bids that will help to drive the post-covid economic recovery.

The economic success of our country depends on small and medium-sized businesses and their enterprise and entrepreneurial skills. As the UK seeks to rebuild our economy, does the Minister agree that SMEs should be at the forefront of bidding and securing Government contracts?

I completely agree. We want to see a much greater variety of companies deliver contracts from every corner of our country, not just because it benefits local economies and communities, but because we think it helps to diversify our risk, creates a more resilient supplier base and delivers some of our critical priorities.

Small businesses are often the source of innovation, particularly in the digital economy. It is often through digital investment that productivity is boosted, so how is my hon. Friend ensuring that those responsible for Government procurement and implementation have the skills that they need to take advantage of the opportunities that small businesses are creating?

My hon. Friend raises a very important point. Along with our procurement reforms, the Cabinet Office has also created a new Central Digital and Data Office under expert leadership, and through that, we want to improve digital capability and expertise across Government. We also want to create many more opportunities for tech start-ups and other dynamic digital SMEs to bid for Government work, and the CDDO team is closely engaged in how we can do that through the forthcoming procurement Bill.