Skip to main content

Government Contracts

Volume 532: debated on Wednesday 7 September 2011

2. What steps his Department is taking to ensure that small and medium-sized enterprises are aware of opportunities to gain Government contracts. (69981)

5. What steps his Department is taking to ensure that small and medium-sized enterprises are aware of opportunities to gain Government contracts. (69985)

We have established Contracts Finder as a one-stop shop, which enables suppliers to find procurement opportunities, tender documents and contracts online and free of charge. We are also piloting a simple method, which I think is called a dynamic market, for suppliers to register online for public sector contracts below £100,000. That will enable small and medium-sized enterprises to compete at minimal cost alongside large suppliers.

Does the Minister agree that, although large companies often find it easy to tender competitively for those contracts, there is a real benefit economically from spending time and effort on encouraging small and medium-sized businesses to bid for such tenders?

I agree strongly with my hon. Friend. There is a temptation to think that it does not matter who provides a public service contract, big or small, but we all have an enormous interest in encouraging small and medium-sized enterprises to engage in the process, because we all have a huge incentive and reason for believing that innovation in public service can lead to more productivity. It is very often the small, innovative companies that engage in innovation, and therefore we need to ensure that we encourage their participation right the way through the process.

SME information technology companies are reporting back from the Government tendering process that project aims and budgets remain unspecified and that forms are still the size of telephone directories. Can my right hon. Friend assure the House that those concerns will be taken on board, so that this Government can deliver real value from IT projects—something that the previous Government failed to do?

My hon. Friend has actively and aggressively pursued several Government Departments about these issues and I hope that he will continue to do so. He is absolutely right that too much of this still goes on. My right hon. Friend the Minister for the Cabinet Office, who has taken the lead on the issue and deserves great credit for that, has not tried to keep the issue secret—on the contrary, he has tried to open it up.

We have introduced a “mystery shopper” scheme, which allows suppliers to challenge Government procurers when they see overly bureaucratic processes. I am delighted to be able to tell the House that during the first three months of the scheme, 23 cases of things such as huge telephone-book-sized contracts were investigated and 11 have led to immediate reductions in tedious bureaucracy. All the information about the scheme has been published on the Cabinet Office website.

Has my right hon. Friend had a chance to read the Public Administration Committee report “Government and IT—‘A Recipe For Rip-Offs’ ”? It points out that we cannot rely on the large systems integrators to involve small and medium-sized enterprises. The Government themselves have to employ people from that sector so that the Government can engage with it directly. That is the only way in which we will get SMEs involved in Government procurement.

As with every product of the Select Committee in which my hon. Friend is so notably involved, we do indeed pay enormous attention to that report. My right hon. Friend the Minister for the Cabinet Office has already taken that set of steps and is already intending to ensure that we have the expertise to do exactly as my hon. Friend recommends. It is absolutely crucial that we get to grips with every large project, and some of them are central to the Government’s policy agenda—in welfare, for example.