Scottish SME’s on the up and up

SME’s in Scotland are currently winning 78% of public sector contracts, which compares with just 13.7% in England. This figure was revealed in a consultation document published by the Scottish government. It was asking for feedback on a procurement reform bill which it hopes to introduce into the Scottish parliament next year.

These figures are clearly impressive but with the new bill, if it is successful, the Scottish government wants to make it even easier for SME’s, third sector organisations and new businesses to gain public sector contracts. Of the 78%, 60% of the SME’s are also Scottish. They account for 45% the country’s £9 billion procurement spend despite only accounting for 37% of Scotland’s annual turnover.

These figures put Scotland in league with just four other EU member states who between 2006 and 2008 had their SME’s having greater access to public sector procurement than it would suggest in the wider economy of their countries. The other four countries are Ireland, Germany, Slovakia and Luxembourg.

The figures from Scotland are in stark contrast to the UK as a whole. In 2010 the Cabinet Office said that SME’s accounted for 50% of the UK turnover but were winning just 6.5%., approximately, of the procurement spend from central government. This figure was estimated to increase to 13.7% by the end of the last financial year.

The consultation document from the Scottish government says that the situation is very different for the UK as a whole and that the EU Commission’s analysis of the member states makes the UK in twentieth position out of the twenty-seven member states. Scotland still spends nearly 30% more than England do with SME’s at local government level. This amount stands at 49% at the present time.