At the end of last week, we heard that Interserve is at risk of administration. This is another large corporate concern, with which the Government has placed a large number of high value, public sector contracts.

For some time – and particularly since the Carillion collapse – the Federation of Small Businesses (FSB) has been warning the Government about the dangers of relying on a handful of outsourcing giants.

This unwelcome announcement should serve to remind us all that this danger remains and that urgent action is needed, now. Especially as these are extraordinarily volatile and unpredictable times.

Our own research shows that small business confidence is at an all-time low – in part dragged down by the political uncertainty that has dogged the UK and Europe for more than two years. The announcement about Interserve’s difficulties will only make matters worse, by fuelling fears across Interserve’s supply chain.

Clearly, despite Carillion, lessons still need to be learned. That’s why FSB continues to call for Government to take a different approach.

We want to see Project Bank Accounts introduced as the norm for large public sector procurement projects, with large-scale contracts broken down to provide opportunities for smaller firms to get involved.

By doing so, Government can avoid playing Russian roulette with taxpayer’s money. They can send a clear message to large corporates that play the existing system and let down both their supply chain and UK taxpayers. Plus they will help to level the playing field for smaller businesses, many of which are currently excluded from bidding for public sector work.

We are also calling for better skills and expertise in Government procurement. After all, these are people who carry massive responsibilities. They are responsible for awarding huge sums of money from the public purse. They must be equipped with the skills and confidence to negotiate at the highest levels in order to secure the best possible value for money and the best possible prospects for successful project delivery.

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