Government Levels the Playing Field for Small Businesses

Announced on the 10th April, the government is making big changes to the bidding process for government contracts, intended to give small businesses more opportunities and better representation.

One of the most significant measures being introduced is that suppliers will not be considered for major government procurements if they do not have fair and efficient payment procedures with their subcontractors. It is also being made easier for subcontractors to report poor payment practices.

Oliver Dowden, Minister for Implementation, also announced that suppliers will have to advertise subcontracting opportunities on the Contracts Finder website and evidence how small businesses in their supply chain are benefiting from the government contract with data.

To further ensure the interests of small businesses are being fairly represented, the Prime Minister has requested several Cabinet members nominate a Small Business Champion minister in each department.

These changes are intended to make the bidding process more transparent and give businesses of every size the opportunity to supply goods and services to the public sector.

Oliver Dowden said: “This Government is listening to the business community and is committed to levelling the playing field for smaller suppliers to win work in the public sector.

“We have set a challenging aspiration that 33% of procurement spend should be with small businesses by 2022 – and are doing more than ever to break down barriers for smaller firms.

“Small businesses are the backbone of the UK economy, and play a key role in helping us to build a strong, viable private sector that delivers value for taxpayers and jobs for millions all over the UK.”

These new government measures coincide with the release of recommendations by the IPSE (the Association of Independent Professionals and the Self Employed) and a collective of small business representative bodies. The 10 point list sets out how the UK can remain one of the top countries in the world to start a new business and will be discussed with ministers in the coming weeks:

  • Delivering and coordinating new data in a way that will accurately measure the contribution small firms and self-employed individuals make to the economy and the communities in which they operate;
  • A new definition of self-employment that leads to fair taxation and a better understanding of working this way;
  • A simplified bidding processes for small firms so they can better apply for government contracts;
  • HMRC to be given more resources to process registration applications for Enterprise Investment Scheme Relief in a post-Brexit scenario;
  • Shared parental leave rights and consideration of extending free childcare hours for self-employed parents;
  • A single gateway to allow small firms to flag late payment concerns, offering four directions of travel to find a fast resolution and facilitate continued trade;
  • Model tenancy agreement for small firms wishing to test out trade on the high street and the simplification of Business Rates Relief so more can claim it successfully;
  • A group to look at how small business support can be funded post-Brexit by harnessing technology and data like Open Banking;
  • The relaxation of business rates relief for co-working spaces to allow micro-businesses to collaborate, and start-ups to get a good start;
  • More awareness of entrepreneurship and start-ups in schools.
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    Simon McVicker, IPSE Director of Policy and External Affairs, commented: “This manifesto comes at a particularly important time for the UK’s 4.8m self-employed population. The rise of the self-employed – up nearly 50 per cent since 2001 – represents a permanent and major structural shift in the economy […] This manifesto provides a roadmap for the government to fully embrace the benefits the self-employed bring to the economy, particularly in ensuring the UK retains its most important competitive advantage – its flexibility – at this uncertain time.”

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