Change is in the air

I was invited to do a turn on a webinar on the new Procurement Act this week. It’s not even close to being my specialist subject. The Procurement Act 2023 relates to public sector contracts, not to the private sector which we at OSBC have responsibility for. However, I never forego an opportunity to drill home the importance of small business getting paid quicker and fairer.

The star of the show, Shirley Cooper, the Crown Representative for Small Businesses at the Cabinet Office, brought along Ian and Alex from her team and between them they know everything about the new Act which comes into force on 24th February 2025. The aim is to get more small businesses involved in working on public sector contracts and to get them paid quickly. For me the positive message here is that it’s been recognised that it’s really hard for small businesses, especially if they don’t have past experience of the public sector procurement process, the capability in-house to fill in all the information required, plus the time to spare, to get involved. And there’s also an important recognition that local authorities and Government bodies need the innovation and agility that small businesses bring to the party.

The new Act is aiming to make it easier for small businesses to come to the table in the first place and making sure they get paid quicker for the work they do. We’ll be watching and supporting from the OSBC as the Act bites.

We’re anxiously awaiting changes here too. I know we’ve been saying for some time now that the Prompt Payment Code will be replaced by the Fair Payment Code but we’re still waiting to be given the green light. The content and guidance are ready. The application forms and FAQs are ready. There’s nothing sinister behind the delay. We’re simply waiting to be given a date. Dates are important especially when there’s a lot going on. Announcements are ten a penny at the minute and we don’t want the important messages in and about the Code to be obliterated by an avalanche of other speeches and initiatives on the day. It’s coming soon.

The aim of the new Code is to reinforce the message that payment within 30 days to suppliers, especially small suppliers, is what’s expected by Government. There are firms with brilliant systems which will hit the top tier. However, it’s a voluntary Code and we do realise it’s still not possible to pay within 30 days in all cases so there is a category for firms meeting the terms of the old PPC too, as long as they also commit to our expected good behaviours, like written accessible and understandable contracts with clear payment terms, with evidence, and commit to engaging with us and our new compliance requirement for spot checks. For aspiring firms that want to commit to improving their payment practices and are committed to all the good behaviours we need in order to achieve the culture change everyone is calling for, there is an entry level category too. We want to drive quicker and fairer payments through supply chains so they’re more resilient and sustainable and every firm can invest in productivity and growth.

Come the new year there will be a plethora of consultations on other proposed changes, to reporting rules and the use of digital tools and even on the powers for my team. We really do want to hear from small businesses when we put out consultations. I know it’s yet another thing to fit into frantically busy days but there is a chance to have your voice heard which is something I’ve been fighting for, for small and micro businesses for years, when it appeared that only big business is ever listened to. Change is in the air. Get work from the public sector, get an award from the Fair Payment Code and have your say in the coming consultations. Be part of the change.