Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

Small and Medium-sized Businesses: Government Contracts

Cabinet Office – in the House of Commons on 27th February 2020.

Alert me about debates like this

Photo of Jamie Hamilton Wallis Jamie Hamilton Wallis Conservative, Bridgend

What plans he has to support small and medium-sized businesses in bidding for Government contracts.

Photo of Angela Joy Richardson Angela Joy Richardson Conservative, Guildford

What plans he has to support small and medium-sized businesses in bidding for Government contracts.

Photo of Saqib Bhatti Saqib Bhatti Conservative, Meriden

What plans he has to support small and medium-sized businesses in bidding for Government contracts.

Photo of Greg Smith Greg Smith Conservative, Buckingham

What plans he has to support small and medium-sized businesses in bidding for Government contracts.

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

We have introduced measures to tackle barriers faced by SMEs in the procurement process. In the last financial year, we spent almost £2 billion more with SMEs than we did in the preceding year.

Photo of Jamie Hamilton Wallis Jamie Hamilton Wallis Conservative, Bridgend

In my constituency of Bridgend in south Wales, the SME market will be absolutely key to making a success of Brexit. Will my right hon. Friend commit to working with the devolved Administrations, so that all parts of the UK will see progress when it comes to SMEs accessing Government contracts?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

I congratulate my hon. Friend on all the work that he has been doing to open up opportunities for his constituents, and particularly SMEs and entrepreneurs. I can commit to, and have already had, conversations with the devolved nations. The contract finder that the Department has set up, offering greater transparency about those opportunities, is just one way that we are assisting, and I would be happy to meet him to discuss other ways that we can support his efforts to ensure that all his constituents have maximum opportunity.

Photo of Angela Joy Richardson Angela Joy Richardson Conservative, Guildford

I thank my right hon. Friend for her previous answer and it is great to see her on the Front Bench. Ninety-nine per cent. of businesses registered in Guildford are SMEs. What steps is the Minister taking to simplify the bureaucracy involved and minimise the cost to SMEs of quoting for Government business?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

I congratulate my hon. Friend on the work that she is doing for all the businesses in Guildford. We have committed to removing barriers to small businesses in our commercial arrangements, and have already removed the complex pre-qualification questionnaires that people used to have to fill out for even low-value contracts. We will continue to look at other ways that we can ensure that SMEs have maximum opportunity to bid for work.

Photo of Saqib Bhatti Saqib Bhatti Conservative, Meriden

I welcome the Minister’s comments. Does she recognise the role that business support organisations play—such as the Institute of Directors, the Federation of Small Businesses, the British Chambers of Commerce and local enterprise partnerships, which lead on the growth hubs—in helping to bridge the knowledge gap for SMEs that have to deal with such difficult processes?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

I thank my hon. Friend for the opportunity to pay tribute to those business organisations, and it is great to see him in this place, with all his expertise in this area. Those organisations play a critical role, and we must listen to what they are saying and look at ways to increase the opportunities for all their members. We want to improve our communications and relationships with those organisations.

Photo of Greg Smith Greg Smith Conservative, Buckingham

Small businesses often tell me that late payments are a significant concern when bidding for not just Government contracts, but all contracts with large companies. What steps can my right hon. Friend outline to ensure that there is a level playing field for small businesses applying for Government contracts?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

We want SMEs to have confidence that they can bid for work. The prompt payment measure, which was introduced last September, has been a key part of the Government’s work to focus on breaking down those barriers for small and medium-sized enterprises. Suppliers that do not comply with that will be struck off, and we have done that. There is more that we are looking at; my hon. Friend will know that there is debate about channelling some of the fines for those with poor practice into compensation for small enterprises.

Photo of Bill Esterson Bill Esterson Shadow Minister (Business, Energy and Industrial Strategy), Shadow Minister (International Trade)

All the friendly questions from the Whips Office do not hide the reality, which is that the Government have had 10 years to get this right. More small businesses than ever have given up trying to win Government contracts, and I am afraid that the figures do not stack up; they are worse now than when the Government came in. When will they stop giving the lion’s share of lucrative Government contracts to the Carillions of this world and start treating our excellent small businesses fairly?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

I notice that there were no facts in that question. If the hon. Member looks at the facts, he will see that a greater and growing number of small and medium-sized enterprises are registering to become suppliers. He will see that 12 Departments in particular are massively increasing the amount of work that they are doing with small enterprises. Rather than criticising my Government colleagues, he might like to start standing up for small businesses in his constituency.

Photo of John Spellar John Spellar Labour, Warley

I think there is unanimity across the House about the need to improve access to Government contracts for small and medium-sized enterprises, but I would prefer it if they were British small and medium-sized enterprises. What action will the Secretary of State take to amend Government procurement regulations so that Departments can start to prioritise British firms, British products and employment of British workers?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

The right hon. Gentleman is absolutely right. He knows this Administration are focused on increasing opportunities across every part of this country. Now that we have left the EU, we will have new opportunities as we design the future procurement rules. I hope that both sides of the House can come together behind that work, so that we have maximum opportunity for every part of the UK.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health)

Can the Minister confirm that post Brexit, contracts’ scoring metrics will be able to add weight for local builders, so that we can keep the money in the local economy?

Photo of Penny Mordaunt Penny Mordaunt Paymaster General

As the hon. Gentleman knows, we are considering what reforms we can bring in. We have set out clearly the principle that this is not just about the immediate return on investment; it is about the long-term opportunities that procurement would open up for every part of the UK.