The UK Ministry of Defence is determined to put small businesses at the heart of its procurement, helping to deliver innovation and value for money across the supply chain.
From developing innovation challenges to setting a spend target, the MOD is encouraging small businesses to step onto the defence supply chain. The next step in helping to develop its relationship with SMEs has seen the MOD simplify its contracts procedure.
By reducing the number of pages of SME contracts, which could range from 18 pages up to 50!, to just three, the Department is hoping this will encourage further SME companies from all sectors to consider bidding for MOD contracts The commitment to increase SME spend was made as part of the 2015 Strategic Defence and Security Review (SDSR15) and with such success during the last year, seeing an achievement of 19% spend and over 5,000 SMES entering the supply chain, the MOD has increased its target spend from 25% to a third spend.
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.”
The MOD is anxious to stress to suppliers and SMEs the benefits of working with the MOD – by simplifying the process of application, encouraging applications for innovation and by ensuring that all companies are paid quickly. Part of the MODs commitment sees suppliers guaranteed payment within 30 days of invoice, while the introduction of the Defence Innovation Initiative should help to harness the ingenuity and entrepreneurship of the diverse businesses within the UK. Supported by a £800M Innovation Fund, the DII will see innovative ideas from across the UK help to provide solutions to the defence sector.
The MOD is also keen to stress that a rising defence budget and an £178Bn equipment plan will provide a wide range of opportunities to businesses who may not have considered working within the defence sector, while we equip our armed forces with the most effective and innovative solutions available, thus keeping the UK secure.
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2015 Strategic Defence and Security Review (SDSR) contracts DII Harriett Baldwin Innovation Fund MOD SME UK
Post written by: Vicky Maggiani
Vicky has worked in media for over 20 years and has a wealth of experience in editing and creating copy for a variety of sectors.
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