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Support grows for regional campaign
Thu 22nd Jan 2009, 10:18am
An influential business forum has added its support to the Buy North-East campaign, which aims to stimulate job and wealth creation in the region by encouraging the public sector to award contracts to local firms.
The Forum of Private Businesses (FPB) has aired its concerns over the public sector bidding processes, and said steps must be taken to make it more accessible to small businesses. The FPB said that taking such action was essential if the Government is to achieve its target of awarding 30 per cent of all public contracts to small firms.
The organisation's comments are a further endorsement of the Buy North-East campaign, run jointly by The Northern Echo and North-East Chamber of Commerce (NECC), which aims to help local authorities to recognise the benefits of awarding contracts to the region's businesses.
NECC research shows the regional economy would grow by £1.35bn and 6,000 jobs would be created if the public sector spent an extra one per cent each year until 2016 contracting services from within the North-East.
Last night, the NECC welcomed the comments by the FPB. Ross Smith, head of policy and research at the organisation, said: "The Buy North-East campaign was launched to make it easier for companies to win business from the public sector and cut through the red tape that surrounds public sector procurement. "This is another crucial step in that direction."
The FPB's comments follow an investigation by the Office of Fair Trading (OFT) that could see fines imposed on construction companies including Balfour Beatty and Carillion for what the OFT says is their part in fixing the price of bids.
Matt Goodman, FPB policy representative, said price-fixing led to local councils paying inflated prices.
"This announcement typifies the behaviour that is all too common in the Government's procurement process," he said.
"Well done to the OFT for bringing these particular cases to light, but these cartels could be foiled simply by making it easier for small businesses to tender for public contracts. "More bids mean fewer opportunities for collusion, and fewer barriers to small business tenders means more bids."
Buy North-East has also been boosted recently by the North-East Centre of Excellence, which unveiled a set of documents - the first of its type in the UK - that councils in the region will have to use when purchasing from local businesses, replacing the present procedure of filling in 25 sets of forms.