Government orders that public spending must back British jobs and skills in every postcode
Businesses bidding for Government contracts – a market worth £90bn per year – will be judged on their commitment to creating high-quality British jobs, tackling local skills shortages and supporting young people into apprenticeships and work placements.
The Government wants every young person to have the chance to earn or learn. New rules will double the importance of creating local benefits when the Government buys goods or services – ensuring spending directly creates training, work experience and jobs in every postcode.
Under the changes, the score for bringing benefits to the local community will be raised from 10% to 20% for contracts worth £5m or more, ensuring procurement, whether from UK or international providers, helps support communities.
The changes will also help smaller, scaling and innovative businesses and civil society organisations who have so much to offer the public sector, but often find themselves locked out of contracts because of layers of red tape and burdensome requirements, which larger organisations know how to navigate. The rules have been simplified and the threshold raised to contracts of more than £1 million so they don’t typically apply to the work smaller firms and local social enterprises are bidding for. This will better allow both smaller businesses and civil society to showcase their innovation and the benefits they are already delivering in communities.
First Secretary of State Louise Haigh said:
“Every pound of taxpayer money should be spent in a way that benefits local communities – creating good jobs and giving young people the skills they need for the future.
“For too long, securing Government contracts has been a tick box exercise that fails to deliver the positive change that people feel in their pocket and see in the places they live.
“We are doing things differently. These new rules will ensure the £90 billion that is spent each year through Government contracts supports British jobs, skills and people in every postcode.”
Bidders can get extra credit for creating local jobs that pay above the legal minimum and treat workers properly, as well as helping to plug local skills gaps by offering training such as 45 days of work experience. These changes will give young people and underrepresented groups a better chance at starting a good career.
Suppliers will be assessed on their commitment to backing British jobs, skills and opportunities, and specifically targeting support for young people not in education, employment or training (NEETs), care leavers and individuals with long-term health conditions.
To ensure companies honour their pledges, for major contracts, Government departments will allocate a key performance indicator and make annual progress reports available publicly. Suppliers’ performance will be measured against their commitments.
