The Scottish Conservatives have today called for smaller businesses to win a greater share of public contracts in Scotland. In their new economic action plan, they also call for action to tackle late payment; a hardship fund for businesses facing localised lockdowns; and a new drive to turn around local high streets and town centres.
Andrew McRae, FSB’s Scotland policy chair, said: “This new publication talks to many of the chronic problems that Scottish smaller firms face. And, we’re pleased to see policymakers taking these matters seriously, as issues like late payment cause thousands of Scottish businesses to fail every year.
“We would warn however that as a consequence of the coronavirus crisis, we’re facing an economic downturn without precedent. Even with the requisite political will, properly addressing some of these issues will take time that many firms unfortunately don’t look like they have.”
Earlier this year, leader of Scottish Labour Richard Leonard MSP called for more local procurement while the Scottish Government pledged action on this front in August following Advisory Group on Economic Recovery report.
Andrew McRae said: “There’s refreshing political consensus that public procurement isn’t working for our local economies, communities or businesses. Now we just need decision-makers to get on with changing how the system actually operates rather than tinkering at the edges. It is a scandal that so few of our very smallest businesses win their fair share of taxpayer funded contracts.”
Official figures show that Scotland’s micro businesses (firms with fewer than 10 employees) receive only 7 per cent of public contracts by value though they account for 93 per cent of Scottish businesses, a figure that has remained stable over the last ten years.
The devolved public sector spends around £12 billion a year on goods and services. The number of smaller firms which supply their local authority fell from 51,312 in 2008 to 29,910 in 2017.
- FSB’s report Broken Contracts: Smaller Businesses and Scottish Procurement, published last year, can be found here: https://www.fsb.org.uk/resources-page/broken-contracts-smaller-businesses-and-scottish-procurement-pdf.html
- Richard Leonard’s speech which mentions procurement can be found here: https://labourlist.org/2020/08/leonard-launches-vision-for-scottish-green-new-deal-to-create-130000-jobs/?amp while the Scottish Government’s commitment to address faults in procurement system can be found here: https://www.gov.scot/news/rebuilding-better/
- Read about the impact of late payment here: https://dailybusinessgroup.co.uk/2016/11/late-payments-put-2000-firms-out-of-business/
As experts in business, FSB offers members a wide range of vital business services, including advice, financial expertise, support and a powerful voice in Government. Its aim is to help smaller businesses achieve their ambitions.