9 November 2007

Stevenson Welcomes New Procurement Rules

Banff & Buchan MSP Stewart Stevenson has welcomed new procurement rules will help small and medium sized enterprises better compete for public sector contracts.

Cabinet Secretary for Finance & Sustainable Growth John Swinney announced a change to the Scottish Government's contract rules to allow suppliers to use an intermediary to raise finance without prior permission.

Factoring and invoice discounting can be an important source of finance to businesses and SMEs in particular. The Government has published guidance for other public bodies and expects them to follow suit.

Commenting on the announcement, Mr Stevenson said:

"We can make a significant contribution to sustainable economic growth by reducing barriers to public contracts and making it easier to do business. This SNP Government listens, and this is a good example of what can be achieved when we listen carefully to the views of our regulatory advisors in business.”

Andrew Watson of the Federation of Small Business Scotland said:

"This announcement shows that the Scottish Government is leading the public sector in opening up more choice and opportunities for small businesses. Removing unnecessary restrictions like this can make a real difference to a small business. This simple rule change will allow those businesses which use factoring services to bid for public sector contracts, improve competition and ultimately deliver better value to taxpayers."

Cabinet Secretary for Finance John Swinney MSP also announced that he would chair the Public Procurement Reform Board to accelerate the pace of reform in procurement - worth £8 billion every year. He said:

"I am determined that procurement reform will deliver results. To drive that forward, I will act as Chair of the Public Procurement Reform Board. I hope that shows the Scottish Government's determination to deliver on this agenda and the high priority we attach to it.

"Let me send a clear message. Individuals or public organisations that prefer not to collaborate on contracts, e-procurement, best practice and policy will be expected to be able to justify their position on objective business grounds.

"I thank John McClelland for the work he has done so far as Chair. In addition to serving as a member of the Board, I have asked John McClelland to continue to advise me on good practice, new opportunities and ways we can accelerate the pace of change.

"We now have, for the first time, detailed management information and analysis showing there are significant benefits to be gained from working together on procurement.

"New performance indicators flowing from the reform programme will be implemented early in the New Year and all organisations in the public sector will be asked to report accordingly. These will help raise performance and establish an environment where measurable, continuous improvement is the norm. I am determined to deliver results for the people of Scotland."

An estimated 1,600 businesses in Scotland use factoring or invoice discounting. The total value of finance raised in this way by Scottish businesses in 2006 amounted to around £500 million.

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