SMEs 'need help in public sector'
Small businesses must be able to win contracts
A recent report has urged the government to help level the public-sector playing field so that more small businesses can win contracts.
In the last Budget the government noted the value of SMEs to the economy.
But according to a report by the Better Regulation Task Force (BRTF) and the Small Business Council (SBC), little is being done to encourage small businesses in the public sector.
"It's no use saying SMEs are vital to the economy and in the same breath saying they are too risky to do business with," said Teresa Graham, chair of the BRTF and SBC.
Tola Sargeant, analyst at research firm Ovum Holway, said the importance of small firms should not be underestimated. "Many of the smaller firms have specialist knowledge that larger firms do not have," she said.
John Griffiths, consulting director at reseller Compusys, agreed. But he added: "The bid process the public sector puts out is so lengthy and complex that smaller companies find it difficult to get involved.
"It would help if there were guidelines published to get a feel about time and detail."
The Office of Fair Trading is considering recommending rules be applied to markets such as technology to ensure that a minimum percentage of public-sector work is awarded to SMEs.
But these rules may be difficult to enforce, Sargeant said. "It would be a massive logistical exercise trying to measure where contract wins have gone through sub-contracting. The best chance for small businesses to win this business may be as part of a consortium," she said.
A decision on the recommendations is expected in the next two months.