Politics of Procurement

Public contracts after the General Election

Despite the three election debates, none of us are any the wiser precisely how the next Government will cut expenditure in order to pay off the financial deficit. We know that change is (hopefully) coming that will reduce the size of ‘Big Government’ and while change often brings threats, it also brings opportunities.

UK Party Leaders

UK Party Leaders

The main political parties have given us some indications as to the areas they will focus on when planning their new budgets. A freeze on public sector pay and recruitment is very likely. Other probable targets include the Regional Development Agencies (RDA’s), major IT projects (ID cards) and defence projects (Eurofighter, or even Trident).

But scrapping these major projects is unlikely to have a direct impact on you, unless you provide non-essential  services (telephone hygienists and hairdressers beware), you recruit public sector staff, or if you work for IBM or BAE Systems.

But on the other hand, freezing pay and recruitment will have a positive impact for many companies, as they pick up the work that would otherwise have been completed by expensive salaried and pensioned public sector staff. The Government and its agencies will continue to provide the same range of services pretty much as they do now, so the number and value of contracts on offer will not substantially decline. Indeed in some areas there will be substantially more contracts. The renewed focus on value and innovation will also open doors to SME’s that have previously been firmly closed.

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