Procurement rule changes to help SMEs

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The government will make it easier for small, local businesses to win public sector contracts, under planned changes to procurement rules.

Under plans published in a Cabinet Office green paper, the government will allow the public sector to “buy British” for contracts not subject to international trade rules, by allowing competitions for government contracts under £4.7m for public works to be limited to small businesses, voluntary, community and social enterprises, or to a certain geographical areas.

Other measures in the green paper include:

  • Removing over 300 regulations to create a single, uniform rulebook;
  • Allowing buyers to include wider social benefits of the supplier, such as economic, social and environmental factors, when assessing who to award a contract to, while still also considering value for money;
  • Giving buyers the power to take account of a bidder’s past performance, allowing them to exclude suppliers who have failed in the past;
  • A new unit to oversee public procurement, with powers to improve commercial skills of public sector contractors;
  • A single digital platform for registering contracts

Cabinet Office minister, Lord Agnew, said: “The measures outlined today will transform the current outdated system with new rules, providing flexibility to the public sector and less burden on business.

“These long-standing plans have been developed with international procurement specialists and will help unleash innovation across the country and provide a fairer system for small businesses.”

The green paper is available here.

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