UK Government can't keep procurement promise

The promise made by the UK Prime Minister, David Cameron, to enable small and medium sized enterprises, SMEs, to gain a fair share of government procurement cannot be fulfilled according to the Enterprise Trust, the think tank for industry specialising in the problems of procurement faced by the UK manufacturing sector. SMEs employ over two million people. New research by The Enterprise Trust shows that government is limited in its procurement processes by legal constraints and by its obligations to the World Trade Organisation and the European Union. The organisation believes that reform of all government procurement programmes must be high on the agenda during any discussions on the economy at the Conservative Party Conference next week.

Breaking up contracts into small parcels to benefit any commercial sector will fall foul of discrimination laws which would probably lead to judicial intervention. If the Government creates a portal through which only SMEs can gain access, as promised by David Cameron before the election, it will make contracts of less interest to the big corporations and interfere with the process of procurement as laid down by the WTO. To begin the unravelling process towards fair procurement, The Enterprise Trust is calling for realism in what constitutes discrimination, particularly now that it is now accepted that some firms who are "Dominant" or "Super Dominant" in individual markets destroy competition through aggressively low or predatory pricing.

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