As we prepare for tomorrows budget, there is a group of businesses that are bound to be ignored in everything that is announced apart from possibly the rhetoric itself. The small and micro businesses in the UK are rarely understood or provided for by Chancellors of any party and George Osborne is no exception. Many of us are faced with a market for public sector contracts, dominated by a small number of large players who unlike SMEs in the area have little or no commitment to local people who should be seen as their clients. Just because the Councillors decided to pass the work on to a large organisation in order to satisfy their cost objectives, in reality these objectives are supposed to be set on behalf of residents whose experience of the contracts may be much less positive than the glossy presentation at County/City Hall when the contract was awarded. Just as no publicly run service should operate without some form of feedback from residents, it seems strange that Councils commission large private sector companies to deliver for them, without the same sort of accountability demanded of Capita, G4S or Sodexo etc. There are a number of examples where the bundling up of diverse elements is carried out to make the contract palatable for the contractor or cheap for the local authority infrastructure that is left behind, without any consideration as to how this will damage the SMEs who previously operated in the markets concerned. These SMEs are often also the taxpayers in the area concerned, they usually create more local jobs, and frequently provide more added value than the large agencies clever enough to win the contracts. This Government has often spoken about its commitment to SMEs, when what they seem to focus on is the large and medium scale businesses, frequently ignoring small and micro enterprises. The gap between small and micro enterprises is modest, but the gap between small enterprises and medium size businesses is much greater. It is also clear that the small and micro businesses are frequently disadvantaged by both Government and larger businesses who are slow to pay their bills. It is clear that if there was a national register of late payers, the desire to avoid being on the list would act as an incentive to pay in a timely manner, and businesses would be able to make an informed decision before contracting with poor payers. My suggestions for George Osborne are:
- A national register of late payers
- A distinction in Government statistics and policy decisions between medium size businesses and the small and micro enterprises. This would include breaking down the public sector procurement targets to ensure that the jam is spread more evenly.
- A requirement that public sector contracts would include accountability from the contractor to local residents, and also an accountability to small and micro enterprises in the area before large contracts involving widespread business areas are awarded.