Almost 80% of public sector contract awards go to SMEs

24th May 2018

Nearly eight out of ten public sector contracts in Scotland are now awarded to small and medium businesses as a result of Scottish Government legislation.

In 2017/18, of the 22,000 contracts advertised through Public Contracts Scotland, 17,500 were awarded to SMEs, of which 13,500 were Scottish businesses.

The Procurement Reform Scotland Act, which went live two years ago, committed public sector bodies to ensuring their procurement practices are open to small and medium enterprises (SMES).

There has also been a sustained increased in the transparency of procurement, with many more contract opportunities advertised online. Since 2014, the number of contract awards recorded on the online portal has risen 46%.

Speaking at the annual reception of the Federation of Small Businesses in Edinburgh, First Minister Nicola Sturgeon said:"The implementation of the Procurement Reform Scotland Act two years ago required public sector organisations to take action to make sure their procurement practices were open to SMEs.

“And the steps we have implemented are having a positive impact, as demonstrated by the welcome increase in public sector contracts being awarded to small businesses.

“In total, 50% of public sector spend on procurement in the last financial year went to SMEs. That's well over £5 billion.

“The value and quality of the services provided by small businesses isn’t simply something this government is praising in our rhetoric; it’s something we are recognising in our purchasing practices."