DfT pledges to spend one third of its procurement budget on SME’s by 2022

The Department for Transport (DfT) has outlined plans to increase its spend with small and medium-sized enterprises (SMEs) to 33 per cent over the next four years and to support small and innovative companies through grants.

The department’s action plan will steadily increase its spend with SMEs over the next few years, with the aim to reach 29 percent within this financial year, rising to 31 per cent in 2019/20, 32 per cent in 2020/21 and reaching its final 33 per cent target in the 2021/22 financial year.

The DfT has already awarded £700,000 as part of a series of transport technology research innovation grants to several projects of which 14 are from SMEs.

These projects include developing software to improve airspace use and reduce flight times and a universal train access ramp that would help passengers with reduced mobility board trains more easily.

The action plan also highlighted the DfT’s £40m-£80m Specialist Technical Advice for Rail Framework, in which 15 of the 42 suppliers on the framework are SMEs that have won direct contracts with the department. The larger suppliers on the framework are also expected to deliver 40 per cent of their work through SMEs.

Transport Minister, Jo Johnson, said: “Small and medium-sized businesses play a key role in this country’s economy and I am proud of our outstanding record in this area. With this new action plan, we are leading by example by making it easier for these businesses to bid for contracts and we will continue to support them over the coming years.”

In monetary terms, 33 per cent of the DfT’s procurement budget means the department will spend about £5bn with SMEs, according to the plan.

Earlier this year, Government figures showed that departments overall spent 22.5 per cent with SMEs in the 2016/17. However, the DfT spent 29.9 per cent of its procurement budget with SMEs in 2016/17, making it one of the highest-spending departments with SMEs.