Government departments, councils and the NHS are geared to dealing with large companies and are failing to get better deals from small businesses. This is the finding from a government backed survey by Tenders Direct. The survey has highlighted the extent of concern amongst the private sector about access to the UK public sector market and brought swift promises of action from both the Small Business Minister and the Chief Executive of the Office for Government Commerce.The survey identified a number of problems which hamper the ability of private companies to do business with the public sector. The major problem to emerge is the difficulty in finding out about opportunities. Over 60% of respondents said it was difficult to find information about tenders and nearly 70% complained that it was difficult to make contacts in the public sector. 72% of respondents said they received no assistance it attempting to break into public procurement. The public sector market is worth 175 billion pounds annually, 17.5% of GDP, but it is claimed that only 20% of public procurement is publicised in government journals. This means that contracts worth over 135 billion pounds are not being openly publicised in a way that would encourage UK suppliers to compete.
The British Chambers of Commerce have called for the government to establish a central clearing house for tenders under 100,000 pounds. The Forum of Private Business has gone even further urging MP’s to follow the example of the USA where 23% of prime contracts must be awarded to small businesses. The Confederation of British Industry commenting on the survey said medium and small business have lots to offer the public sector, but they can only bid if they know about the opportunities and if the tendering procedures are user-friendly.
Nigel Griffiths, Small Business Minister said the government takes this survey very seriously and he urged public sector agencies to open their doors to small businesses, which are cost effective and have dedicated staff. Peter Gershon, Chief Executive of the OGC said that smaller suppliers can often offer better value for money than larger companies and he wants public bodies to ask themselves regularly whether a smaller supplier may offer the best solution.