A Strong Voice for Minority Businesses

MSDUK members Dexo Technologies and es-p have been selected for the Government SME Advisory Panel.

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The UK government recently formed advisory panel aims to make it easier for small and medium-sized enterprises (SMEs) to sell to the government. The panel, made up of 24 entrepreneurs and leading business, will work with the government to ensure that the voice of SMEs is represented in the decision making process. Among the entrepreneurs, two members of the MSDUK network, Arnub Dutt, CEO of Dexo Technologies and Farooq Mohamed, Managing Director of the es-p Group, have been selected on the panel.

The government is making a greater effort to spend more with SMEs and the Cabinet Office has estimated that 27% of government’s procurement spending, or £12.1 billion, reached SMEs in 2014-15, surpassing its target of 25%. An even bigger target has been set by the government that aims to increase spending with SMEs to 33% by 2020.

Arnab Dutt CEO, Dexo Technologies said:

‘The Government has a target to ensure that SME businesses in the UK will receive 33% of central government procurement spending by 2020. It’s an ambitious target but achieving it will not only foster greater participation in the overall UK supply chain, but should also have a major social impact on communities throughout the UK’.

Increased government spending is welcomed news, as SMEs make a considerable contribution to the UK economy and account for over 99% of all private sector businesses. From an MSDUK prospective, having two of our members advising on government procurement spend is significant as the majority of our membership is composed of SMEs. Successful entrepreneurs Arnab Dutt and Farooq Mohamed understand the challenges faced by many ethnic minority businesses (EMBs); these are similar challenges faced by non-ethnic SMEs, the difference being a lack of inclusion and opportunity in private and public supply chains.

Farooq Mohamed, Managing Director of es-p Group said:

‘Wearing the twin hats of being an SME and MSDUK certified supplier/EMB committee member, I am keen to examine the Government’s approach (and spend) in relation to inclusive supply chains. Inclusivity is a key tenet of MSDUK and a principle we all hold dear as corporate and supplier members. However, this is not an area which is currently scrutinised and when we consider major Government infrastructure projects running through some of the most diverse areas of the country, like HS2, it becomes necessary to work with Government to ensure inclusivity within Supply Chains to reflect the wider communities within which they work/serve’.

While inclusive procurement has been embraced by private sector organisations in the UK, there is still considerable work to be done when it comes to opening up public sector supply chains. The government have taken a number of positive steps to reduce the barriers faced by SMEs when bidding for public sector work and have introduced initiatives such as ‘Contracts Finder’, an online portal for advertising government tenders; it has also removed pre-qualification questionnaires for low-value contracts. Furthermore, the introduction of the Social Value Act in 2012 requires consideration of wider social, economic and environmental benefits in procurement processes and is often thought to benefit SMEs and smaller suppliers. However, engagement with minority businesses regarding direct and indirect government spend remains very low. There is no data to suggest that minority owned businesses are being included in central government procurement opportunities or have been successful in obtaining government contracts. There are approximately 300,000 minority owned businesses that contribute around £25-32 billion every year to the UK economy and it is essential that they are included in central and local government supply chains and that their voice is heard by policy makers. Two MSDUK members being selected on the on the Government SME Advisory Panel is a good start, but more needs to be done.