6 September 2007
The government should use a £625 million-a-year fund to stimulate innovation among suppliers and get a better deal for the taxpayer, according to a report.
Innovation and public procurement, from the manufacturers' organization EEF, said: "Public-sector procurement should be used much more extensively as a driver for technology and innovation."
It recommended giving control of this budget, drawn from various existing sources, to an enhanced Technology Strategy Board, which would be given a remit to "take on high-risk projects requiring radical innovation". Currently, it said, "most UK public procurement practices neither foster business led innovation nor allow government to maximize long-term value from its investments".
Jeegar Kakkad, EEF senior economist and author of the report, said the TSB could play a role in "pushing and procuring innovation" to support government policy.
For example, it could back suppliers to develop energy efficient and carbon-neutral housing as part of the push to build "green homes". It needed to back "ideas that have credible uses", said Kakkad. The beefed-up board should also be used to improve public-sector purchasers' skills in risk management, commercial best practice, technical skills and how to recognize long-term value.
The government also needs to develop and communicate a long-term strategy.
"Setting out a strategy would provide business with insight into government demand that would help it to invest in the appropriate capacity," the report said.