Local Government Procurement

Debate between Clive Betts and Chris Williamson

Thursday 13th March 2014 Commons Chamber

[Mr Betts]

We did not look specifically at food contracts—obviously, with £45 billion of spending, there is a wide range of contracts—but we found that local government commissions and procures about 40% of its expenditure from small businesses. That is a higher percentage than for central Government, so there are many good examples. We recommended that councils should have an annual report. That would allow them to consider how to deal with small businesses and tailor commissioning to enable them to compete for contracts; that is an important element of the recommendation. That should be embedded in council policy from the beginning. Councils should not just suddenly think, “Oh dear, that contract hasn’t really given small businesses a chance” after it is let. It should be embodied in the policy of the council from the beginning.

[Chris Williamson (Derby North) (Lab)]

I congratulate my hon. Friend, the Chair of the Select Committee on which I serve, on his statement. Does he agree that the £45 billion of procurement for which local government is responsible makes a considerable contribution to economic growth and sets a good example—I think he alluded to this in his response to the hon. Member for Tiverton and Honiton (Neil Parish)—that central Government would do well to follow? Procurement should benefit the British economy rather than being expended overseas, something we unfortunately see with central Government procurement, such as with the contract for the Thameslink deal that should have gone to Bombardier but went to Siemens.

[Mr Betts]

Some of the councils that we studied took a robust and considered approach to benefits for their local economies, while others did not do quite so well in that regard. Again, it is necessary to learn from good practice. We asked the Government to carry out a post-legislative review of the Public Services (Social Value) Act 2012, which gives councils certain responsibilities, to consider its impact on local economies, and to extend its social value requirements to smaller contracts, which it does not currently cover.