MoD announces next step to improve SME business engagement

The MOD has announced the next step in its programme to place small businesses at the heart of defence procurement and deliver better value for money.

The department is simplifying Ministry of Defence (MOD) contracts, to make it easier for small businesses to work with defence. The Department has reduced the number of pages of small and medium-size enterprise (SME) contracts from a minimum of 18 pages, usually around 50, to just three.

This is part of the commitment made in the 2015 Strategic Defence and Security Review (SDSR15) to spend 25 per cent of procurement money with SME suppliers by 2020: the figure currently stands at 19 per cent with about 5000 firms supplying the MOD and contracts worth £822 million in 2014/15.

Minister for Defence Procurement Harriett Baldwin said: “Acting on direct feedback from industry, we have introduced a simplified contract with three pages for terms and conditions compared to at least 18, and often more, in our previous low value contracts. This is part of a wider programme of work to encourage smaller businesses to get involved in defence."