techUK publishes results of seventh annual GovTech SME Survey

 Helping SMEs access the Public Sector technology market is a critical part of the work we do here at techUK. The potential that small businesses have to transform public service delivery through their innovation and capabilities is clear and well-documented. We want to support government in recognising this, which is why every year we undertake this survey.

This year’s survey analysed the opinions of over 100 techUK SME members who work in or aspire to work in the public sector on a range of topics, from how effectively they feel the government has acted on its commitment to helping small businesses break into the public sector, to how they feel about addressing Social Value.

The results highlight the fact that SMEs operating in the public sector face numerous challenges, including lack of meaningful early industry engagement, too many frameworks, and a risk-averse culture within the civil service. 

Government support 

On a positive note, 59% of respondents believe that Digital Marketplace is still helping to improve SME access to the marketplace and make opportunities more visible and open to all, this also came to light in the previous survey. The Digital Marketplace is a one-stop shop which allows all public sector organisations to find cloud technology and specialist services for digital projects. 

However, only 27% of respondents feel that the government has acted effectively on its commitment to helping small businesses break into the public sector over the last five years. This figure is significantly less than what the previous GovTech SME Survey found (40%). 

The survey also highlights a widespread feeling of SME underuse by government, as 91.2% of SMEs do not think government has sufficient understanding of how small businesses can meet their needs. This is a worrying statistic and has remained largely the same over the past couple of years. We want to ensure the government take advantage of the innovative nature of SMEs and recognise their capabilities.

Social value 

In 2021, new procurement measures took effect, requiring that social value contributions account for at least 10% of the overall assessment score. While suppliers are broadly supportive of social value objectives, the implementation of the policy has proven challenging for SMEs in particular, as they often do not have the excess capacity or financial resources that larger companies use to address social value questions. 

As a result, 76% of respondents said that addressing social value in contracts is an administrative burden. 

Recommendations 

This year’s findings remain similar to last year’s and signs of improvement are still marginal and slow. techUK has therefore identified five key recommendations for government: 

• Engage in more early pre-procurement market engagement 
• Provide more support around social value 
• Apply fewer frameworks 
• Appoint ministerial SME champions who can understand the way SMEs operate and their needs 
• Identify opportunities for collaborative bids and partnerships to support SMEs. 

Putting SMEs at a disadvantage when it comes to getting onto frameworks and applying social value means the government is missing out on innovation and the full capabilities of the market. Efforts from Government work when they are used effectively and with SMEs best interests at heart and we will keep doing our best to drive the next leap forward in access to the public sector technology market for SMEs.