The Procurement Act 2023 will deliver simpler and more effective public sector procurement, and it will help SMEs secure a greater share of approximately £300 billion of expenditure every year. The Act includes a new duty on contracting authorities to have regard to the particular barriers facing SMEs and to consider how they can be overcome.
To some extent, SMEs have historically been blocked out by large companies. This week it was reported that the Government tried to block Fujitsu from bidding for future contracts, on the basis of woeful performance in previous contracts. Government lawyers have advised that this cannot be done, but they are wrong. Will the Government give further serious thought to blocking large companies with terrible track records, such as Fujitsu, from bidding for future contracts and, if necessary, legislate accordingly?
I thank my right hon. Friend for his question. As he will know, there are clearly defined circumstances in which the Government can exclude companies from bidding for contracts. With regard to Fujitsu, he may be interested to hear that this morning the Cabinet Office received a letter from Fujitsu voluntarily undertaking not to bid for Government contracts while the inquiry is ongoing, unless of course the Government asked it to do so.
When it comes to small and medium-sized enterprises getting Government contracts, sometimes the devil is in the detail and the unintended consequences. One business has told me that the prior year turnover to contract ratio restriction in public procurement is hindering the growth of businesses such as Kromek in NETPark, Sedgefield, forcing them to surrender margins to prime contractors and meet the contracting eligibility requirements, costing the UK Government the best innovation and costing SMEs growth. Will the Minister please commit to exploring alternative measures for assessing contract eligibility, including looking at the model of the US Government and their associated agencies?
I thank my hon. Friend for his question. I know that he will have followed the passage of the Procurement Act 2023 through Parliament closely, as will businesses in his constituency—particularly SMEs, I hope. He will have seen that the Act removes unnecessary obstacles relating to audited accounts and insurance for the conditions of participation, meaning that small businesses will no longer be shut out of the procurement process or incur unnecessary costs. That duty that I referred to earlier for those procuring Government contracts to consider how to remove barriers to SMEs will really change the landscape for our small and medium-sized enterprises.
In his reply to the right hon. Member for Haltemprice and Howden (Sir David Davis), the Minister totally missed the point, because he referred to defined reasons why companies could be excluded. The Government and Parliament make the rules. They have been dragging their feet month after month, year after year, on changing that in this regard, but also in terms of supporting domestic industry, as every other major economy does. When will they sort this out and get it down to the House and into the rules, over civil service intransigence and delaying tactics?
The right hon. Gentleman will have heard what I just said to my right hon. Friend the Member for Haltemprice and Howden (Sir David Davis). I know that, as a lover of due process, he will believe that the statutory inquiry should appropriately have the final word on this. And when it does, we will have absolutely no compunction in acting.
May I, too, convey my sympathies to the family of Tony Lloyd? I thank you, Mr Speaker, for allowing us the opportunity to come together more fully as a House to pay tribute.
I thank the Minister for his answer. My constituents in Strangford, and indeed people across Northern Ireland, including a large number of small and medium-sized enterprises and businesses—they create many jobs, wage packets and opportunities—very much want to be part of this process, and I know the Minister is keen to support us. What can be done for defence procurement, for example, and also for the food and agriculture sectors, because we have great companies that have the potential to do better. Can the Minister add his support?
I certainly can. As my hon. Friend will know, Northern Ireland agreed to be part of the new procurement regime when we passed the Procurement Act, which is fantastic. Sadly, that is unlike our friends in Scotland, who will miss out on all the benefits of the best modern procurement framework in the world. That means that small and medium-sized enterprises in his constituency will now have a better opportunity to bid for Government contracts. I very much enjoyed being in Northern Ireland at the end of last year. I am going again in the next few months and would be happy to meet any businesses that he would like to put me in touch with.