In his second report on small firms, ‘Growing Your Business’, Lord Young, the PM’s adviser on enterprise, recommends the removal of pre-qualification questionnaires across the public sector for all contracts below the EU threshold of £173,934.
According to the report, Lord Young believes that the “abolition of PQQs together with the replacement of completion bonds by an insurance scheme would transform the opportunities for small firms and result in a stronger SME sector and at the same time save the taxpayer considerable expenditure”. In this he is building on the initiative of Francis Maude, who scrapped PQQs for central government early in 2011.
Although a well intentioned initiative to enable access to public contracts for SMEs, this is a badly flawed policy that will have exactly the opposite effect. It sounds beneficial to remove bureaucracy from the tender process, but what is actually being removed here is the ‘pre’ element. The qualification questionnaire would still remain, but instead it would be bundled with the full tender response.
This dramatically increases the workload for any company wishing to bid as a full proposal is now required, together with the qualification information. This may be acceptable to a larger company that is confident of winning a high proportion of its bids, but disastrous for any SME’s making a more speculative approach.
It’s undoubtedly true that many PQQs have gold-plated requirements and even more frustratingly each organisation require answers to essentially the same questions in a different format. What is actually required is a reform of the qualification process that efficiently assesses the capability of a supplier. This should be standardised across the public sector so that it only has to be completed once a year.