**London**: The Cabinet Office has proposed the creation of a ‘Commercial Innovation Hub’ aimed at improving procurement practices by sharing best practices among departments, leveraging insights from past events like the Covid-19 pandemic, and promoting opportunities for small businesses in public contracts.
Ministers have announced plans to create a new initiative termed the “Commercial Innovation Hub”, aimed at enhancing procurement practices within government departments. This proposal was shared by the Cabinet Office as part of its broader National Public Procurement Policy Strategy, released recently.
The hub is envisioned as a central platform that will facilitate the sharing of best practices and innovative solutions among various governmental departments, enabling them to harness lessons learned from significant events, including the Covid-19 pandemic. The Cabinet Office indicated that the hub could act as a “golden link” that enables departments to leverage new flexible powers introduced by the Procurement Act 2023, thereby enhancing the value derived from public spending.
A notable example cited by the Cabinet Office is the process of vaccine procurement during the pandemic, suggesting that insights from this high-stakes situation could inform typical procurement activities within governmental bodies. The Cabinet Office is also working on the development of an artificial intelligence tool designed to assist commercial teams across the government. This tool aims to streamline tasks such as contract redaction and provide quality assurance for procurement documents, thereby enhancing efficiency within the procurement process.
The publication of the National Public Procurement Policy Strategy marks a significant step in realigning the public sector’s annual expenditure of approximately £400 billion with the government’s strategic objectives, which encompass five specific missions aimed at improving societal and economic outcomes. The strategy calls on contracting authorities—including local councils, NHS bodies, and various government departments—to foster a collaborative approach across policy, delivery, and commercial functions. This is intended to promote a “pro-innovation mindset”, which prioritises defining challenges over merely seeking ready-made solutions, as well as engaging more proactively with the market.
Georgia Gould, parliamentary secretary at the Cabinet Office, highlighted the challenges small businesses face within the current public procurement system, describing it as “slow, complicated”, and often inaccessible to smaller firms. She stated, “These measures will change that, giving them greater opportunity to access the £400bn spent on public procurement every year, investing in home grown talent and driving innovation and growth.”
Additionally, the Cabinet Office intends to enforce new obligations on firms awarded government contracts, mandating them to advertise job opportunities at local job centres. This is part of an overarching strategy to increase local economic activity. Proposals also include empowering local councils to preferentially reserve contracts for small businesses, stimulating local economic spend.
The Cabinet Office acknowledged existing social-value requirements placed on businesses benefiting from public contracts, but indicated that the varied approaches across the public sector have hampered effective implementation. In response, ministers plan to update and simplify the existing procurement system for central government departments and their agencies to ensure better alignment with government missions. The intention is to create a more user-friendly process that increases opportunities for small businesses bidding for contracts, while also ensuring that companies benefitting financially from government work contribute meaningfully to their communities.
Source: Noah Wire Services
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