Small businesses won a record-breaking amount of government work, new figures released by the Cabinet Office have revealed.
The new figures show UK small businesses received £21 billion worth of work in 2021/22, equivalent to around £3.8k per British small business.
Government work won by small businesses range across all sectors, including public infrastructure – supporting building schools and hospitals, defence – developing high end technology to keep the country safe and healthcare – helping keep the country healthy through clinical, medical and digital health services, as well as many more.
The figure is an increase of £1.7bn on the previous year, and the highest since records began, representing the fifth consecutive year that government work won by small businesses has increased.
Minister for the Cabinet Office Jeremy Quin said: “These record-breaking figures demonstrate our commitment to ensure more small businesses benefit from public sector spending, by reducing barriers to entry and encouraging a more diverse market.
“One in three pounds of public money is spent on public procurement, which is why through the Procurement Bill we are improving the way it is regulated to save the taxpayer money and drive benefits across every region of the country.”
Under new rules all departments and public bodies are required to consider SMEs when designing their procurements, meaning that more SMEs will get to compete for and win government contracts through simpler and more flexible regulations.
The new rules also include:
- Greater visibility of upcoming work, giving SMEs more time to gear up for bidding
- A new central platform showing future work in each area. This means for example a new SME tech firm in Lancashire will be able to search for tech opportunities upcoming in their region
- Creating one single website to register on, rather than the multiple and time consuming systems SMEs currently have to register on before bidding for work
- Reducing unnecessary insurance costs before a supplier has even bid for a contract
- A new Competitive Flexible procedure, which will allow contracting authorities to design more innovation into the process.
- Strengthening prompt payment, so that businesses throughout the public sector supply chain receive payment within 30 days
