Article by ICG member Liz Montgomery, Sharp Research
Back in summer 2025 I participated in a survey run by the FSB (Federation of Small Business) about public procurement, which also covered procurement by large organisations more generally. It had a decent number of open ends, and I added my views on public procurement in quite a direct way. A couple of months later they contacted me (and a number of other small businesses for a follow up interview, which was moderated (very well) by one of the FSBs policy specialists.
The report, Signed, Sealed, Delivered was published towards the end of 2025 (free to download here https://www.fsb.org.uk/resources/policy-reports/signed-sealed-delivered-MCGXDJ3J475NEPFOLCT6WGFAHFVU), and contains a mix of positive proposals, but also quite damning findings about public procurement processes. Several striking stats emerge
- the number of SMEs directly invoicing the public sector has fallen since 2020 (and was already pretty low at well under 150,000;
- A national ambition to grow procurement spending with SMEs to reach 33% by 2020, but is reported to have been stuck at around 20% of the total spend by central government, and even including indirect spend in some departments is less than 13%!
The report is also pretty damning on the experience of the RFP process.
Late in December I was surprised to be invited to participate in a round table with the Parliamentary Secretary for the Cabinet Office, Chris Ward MP, to whom, among others the report had been presented. This was held in January of this year, and in advance of the session I asked members of the ICG to submit their experiences and comments so I could hopefully share them at the Round Table.
I had a super amount of input from many people. The comments that from other ICG members really reflected a lot of the findings in the report, and I shared an anonymous version of this with the policy team at the FSB, which they found very helpful and interesting. Our experiences included
- Issues with payment terms and financial pressures on micro and small research insight businesses , including extended and unilateral payment terms, cashflow vulnerability, and psychological impacts, plus undermining the value of the work delivered, especially at the bidding stage
- Barriers to accessing public sector work – too many complex processes which are biased to large organisations, excessive focus on price and they simply take too much time and effort with often a zero success rate (sometimes over many years). Incumbent suppliers seem to be favoured at every point. And then there is unhelpful or no feedback on why the bid was unsuccessful.
- Structural issues in procurement culture included impersonal and inaccessible processes, plus examples of lack of guidance and clarity. One ICG member reported attending a supposed pre-tender webinar that was completely confusing rather than enabling, and often it was felt that public sector buyers simply did not understand the nature or value of the services they are procuring!
The round table itself, held on 27th January, was well attended, and I felt initially it might not be a very open session. But, in fact, it was very lively, the minister was very engaged, and those of us attending as SMEs (all of whom I think had been quoted in the report), were not shy in any way in pitching in with our views. Well chaired by Tina McKenzie, the FSB’s Policy Chair (a small business owner herself), she made sure we all had our say.
Apart from other SMEs, there were also attendees from the rest of the Cabinet office, the Department for Business and Trade, Tech Nation, and Technology UK plus the JP Morgan Chase Foundation who funded the research (I was sitting between their 2 reps!)
The input from those of us there as SMEs focused on
- the ridiculous nature of the procurement processes themselves (impersonal, complex, time consuming, why bother?!)
- the apparent bias towards incumbent providers
- the need for improved terms and conditions (especially that primary contractors should not over-ride 30 day payment terms) – payment terms are a massive issue, as we all know.
- a need for increased and more helpful pre bid engagement
- there are still too many different government bid platforms, and a lot of bids not going on, for example, Contracts Finder and various questions were raised as to whether the Crown Commercial Service is actually doing a decent job on this
- emphasizing that often those doing the procurement lacked the knowledge to do so effectively
- also the importance of social value, and the focus on local employment and driving local change
- it also contradicted the finding reported that local authorities are good at prompt payment!
A strong and interesting theme was that by excluding small businesses, government and other public procurers were often stymying the innovation that SMEs can provide, and that there is a perception that there is a strong tendency to stay with the safe option, which may not necessarily be the most effective (or cost effective) option.
Many of these are common to the issues we highlighted, and I was able to reinforce the arguments about current processes apparently supporting incumbent suppliers, as well as the challenges of the procurement processes. But it was definitely evident that our experiences are by no means unique to us. Which is a very helpful finding.
The minister seemed very engaged and open, as did other government representatives there. I was seated near a DBT mandarin, who clearly recognised the issues of lack of understanding in his teams of these procurement issues, although I was not convinced he would be in a position to do anything about them
What were the conclusions from this lively and very open discussion? The chair summarised these quite succinctly, and here are the elements I think most relevant to us as a community:
- A strong argument for focusing on solutions-based tendering rather than solely price based tendering
- Highlighting issues with local authority payments
- A need to protect the supply chain – i.e. to make sure that those of us that are not primary contractors get treated fairly (and paid on time not 90 days…)
- That the government needs to think about a better contract/bids information platform than the current solution it offers (and, yes, the FSB did float the idea that they could operate one for SMEs!
It was a very interesting 90 minutes, and the Minister and his team even stayed on for a while after.
On reflection, I am not sure that “Signed, Sealed, Delivered” has been achieved. It has certainly been delivered, and the Minister and his team made reassuring comments and seemed engaged. Apparently two government departments, including the MoD have now made commitments to increase their use of SMEs. However it is going to take a massive effort for the dial to be moved, and that effort will be required by all parties, especially all governmental organizations.
I should also add everyone agreed that the catering at the event (another FSB) was some of the best we have ever had. Freshly made eggs benedict, various healthy mini muffins, croissants, fruitiness, home made compote, juices… I was impressed. If you need caterers in London go to these guys – Piptree https://www.piptreecatering.com/ Very impressive ! If you go to the website, the husband was looking after the eggs benedict and others on the pic were also there.