Tussell, which provides market data on what the UK government is purchasing, has found that of the government’s 35 strategic suppliers (defined as third-party companies that the government deems as critical to the delivery of public services) the Big 4 consulting firms won the most in terms of increased revenues from the public purse during 2019.
“It is perhaps unsurprising that government spend with strategic suppliers – particularly the Big 4 consulting firms – is on the up, given that the UK is facing a number of complex macro challenges, namely Brexit and the response to COVID-19,” says Derek du Preez on diginomica. According to recent Cabinet Office data, departments spend nearly twice as much with the strategic suppliers as with all SMEs across its supply chain.
“The British government over the past few years,” he says, “has undertaken attempts to diversify its supply chain, trying to shift its focus away from a handful of powerful suppliers towards SME providers. The results have been mixed and there has been growing scepticism in recent years that the enthusiasm for such initiatives is fading.”
“In terms of the COVID-19 response, SMEs are not heavily involved, earning just less than a third of the total contract value. That being said, this is more than the wider UK public procurement market, where last year they earned less than 20% of the total value of public sector contracts awarded.”
“Unfortunately it seems that any forward thinking approach,” he says referring to the impact on UK industry, skills and projects that can aid the economic recovery, “is currently lacking and the strategy is being outsourced to the consulting firms that will be more than ready to provide guidance.”
The article calls on a new procurement programme to be devised that focuses on a broader growth strategy for the UK.
For details on the figures awarded by firm, those that saw an increase in awards and those that saw a decline, and to understand what the government is prioritising, read this.