20 November 2009 | Allie Anderson
Suppliers are not bidding on public sector contracts because the process is inconsistent and too complicated, research has found.
A survey conducted by the North East Chamber of Commerce (NECC) revealed 80 per cent of firms are put off tender opportunities in the public sector because they are unnecessarily complex. Almost three-quarters said they would be more likely to bid for contracts if documents were simpler.
One of the major hurdles highlighted by some of the 190 businesses surveyed was the huge variation in processes between different local authorities, including how contracts are advertised and what requirements any vendors who submit a tender must fulfil. More than 60 per cent said lack of awareness of what opportunities are available in the public sector was a barrier.
Ross Smith, head of policy and research at NECC, said: "The survey confirms many of our fears - that the process of public sector tendering is putting businesses off. Local authorities in particular are making important efforts to change, but businesses have yet to feel the full benefits. The public sector needs to do all it can to pick up the pace of its reforms to the procurement system."
If local authorities invested an extra 1 per cent of spend each year to 2016 in attracting local suppliers rather than contracting outside the region, the North East economy could grow by £1.35 billion and benefit from an additional 6,000 jobs, the NECC said.
Smith added: "The public sector makes up a large part of our regional economy and it is crucial that it uses the £3.5 billion it spends on goods and services each year for the maximum economic benefit of the North East.
"However, to capitalise on this opportunity it is essential that more is done to make the process of tendering more straightforward and user-friendly."