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Simplifying Public Sector PQQs for SMEs

Comment 15th March 2013

Simplifying Public Sector Pre-Qualification for Local / Central Government Contracts for Small to Medium Sized Businesses

Many small to medium enterprises are missing out on winning public sector contracts – and the Public Sector is missing out on the chance to gain more innovative, customer focused and often cheaper, locally based services.

There are two main problems – the first is that most of the PQQ points are awarded at Pre-Qualification Stage only if the enterprise can demonstrate past experience in a particular, specific area – even though they may operate in the right industry. This is very difficult for some businesses – eg an architect's practice may have much experience in housing, but little or none in education – so it is effectively excluded from this sector, even if it has staff with education experience and offers the lowest tender price.

The second is the wide ranging and often irrelevant and absurd requirements for company policies and credentials e.g: staff ethnic monitoring policies (even if the firm has only ten people or less), membership of third party organisations with their own rigid and costly entry PQQ criteria e.g. Health and Safety Organisations, Investors in People etc. 

Some PQQs (e.g. ODA) award points if companies exceed the minimum standards for maternity pay – a worthy incentive – but how many SMEs can afford this? 

These requirements for pre-qualification present barriers to SMEs joining in with Public Sector Contracts.

The result is that the same, larger companies win most of the work, time and time again.

The idea:

1. Simplify and reduce PQQ requirements to the absolute minimum required to do the job – nothing more, nothing less.

2. Do not dis-qualify companies at the first PQQ stage who are operating in the right market sector, just because they have not had specialist experience of the exact type of contract offered.  

Why does this matter?

My idea is important because:

1. Many small to medium enterprises are missing out on winning public sector contracts – and the Public Sector is missing out on the chance to gain more innovative, customer focused and often cheaper, locally based services.

2. SMEs are accepted as a key driver of future economic growth, innovation, employment and technological development.

3. SME are mainly UK owned – the wealth stays in the UK.

3. The big companies have their place and strengths- but SMEs are not getting their fair share of public sector work.

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