Tuesday, 15 February 2011

Contracts Finder

Contracts Finder, which is hosted by Business Link, is the new portal for publicising UK public sector tender opportunities. It replaces Supply2gov, and like that will send e-mail notifications of tender opportunities to registerd users as well as making them available online. The intention is that this will be a national portal, and free to use.

Some information about it came in a recent government press release;
Prime minister David Cameron has promised to open up the government’s supply chain to smaller organisations.
Speaking at the launch of a new online tool, Contracts Finder, Cameron said: “Wherever possible, we’re going to break up large contracts into smaller elements, so that SMEs can make a bid and get involved.
“And where that’s not possible, we’ll also work proactively with our large suppliers to directly increase opportunities for smaller organisations in the supply chain.”
Cameron says he wants 25 per cent of all government contracts are awarded to small and medium-sized enterprises.
At the moment it is estimated that SMEs only win five to ten percent of the billions of pounds of public sector business.
“If we meet this goal it will mean billions of pounds worth of new business opportunities for SMEs,” he said.
The move is part of changes to the way government procures goods and services.
“We need to make the system much more open, competitive and transparent,” said Cameron.

Fine words.

But almost identical to whoever said them when Labour were in power.

I cannot disagree with his intentions – I am just sceptical about the results that can be achieved.
If the system is to be open, competitive and transparent then we cannot set targets to favour one group of potential bidders (i.e. SMEs) even though we all think it is necessary to encourage them.
You cannot break up small contracts for the purpose of getting them below the EU threshold limits.
Also breaking up contracts costs money – more administration, fewer economies of scale etc.
Large suppliers subcontracting down the supply chain cannot be mandated, it can only be encouraged – in practice it usually means sub-contracting to already approved suppliers.
The government can WANT to give 25% of contracts to smes – it just does not have the mechanisms to do so. Of the 5% to 10% actually going to SMEs, what % goes to companies at the top end of the band? My guess is more than goes to those in the bottom half of the band - but I admit I have no proof.

I am totally behind the intentions of this initiative - but I believe it will be very difficult to achieve the desired results. Please feel free to disagree - comments are welcome

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