The government has scrapped the requirement for suppliers to complete "complex" pre-qualification questionnaires (PQQs) for small public sector deals in a move it claims makes life easier for SMBs.
New legislation states that for public sector contracts worth less than £100,000, "complex forms" such as PQQs are no longer required.
The government unveiled the plans last week, and they come fully into force today as the government talked up its success in using SMB suppliers.
Last November, the government came under fire from smaller IT suppliers which criticised the endless red tape for small deals – one distributor boss said he had to fill in a 92-page form just to bid for a £10,000 deal.
On top of the PQQ abolishment, from now on, 30-day payment terms will be mandated to suppliers and their sub-contractors and public bodies will have to publish annual late-payment reports in order to "sharpen accountability".
The government claims the new laws form part of its long-term economic plan to make government more efficient by using a range of suppliers including smaller, more agile companies.
Cabinet Office minister Francis Maude is expect to announce later today that in 2013-2014, central government spent £11.4bn with SMBs. He is set to unveil new data which shows 26.1 per cent of central government spending went through SMBs – 10.3 per cent was spent directly with smaller firms and 15.8 per cent was spent indirectly.
Back in 2011, the government aimed for 25 per cent of central government spend to go through SMBs. Maude said despite exceeding the target, more needs to be done to level the playing field.
"As part of our long-term economic plan this government is overhauling public procurement to open things up to business of all sizes," he said. "Over a quarter of central government spend now goes to SMBs but we know there is much more to do and these new reforms show just how determined we are to finish the job."
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