Smaller charities often find it hard to win public sector contracts. The situation is partly due to the overly complex rules and procedures that give an advantage to bigger organisations with more resources to deal with the red tape. It’s also partly down to culture, with commissioners ‘going with what they know’ and favouring bigger organisations again and again.
A 2016 study of 120 contract public sector tenders prepared by the Lloyds Bank Foundation found that smaller charities were effectively shut out of government and council work by excessive bureaucracy. As well as long, difficult and time-consuming bid procedures, often requiring numerous meetings and long tender documents for relatively small contracts, some tenders had a minimum turnover limit, preventing smaller charities from even attempting to win public sector work.
Writing in The Guardian, Nick Davies, public services manager at the National Council for Voluntary Organisations, noted that smaller charities have suffered in recent years, “…depriving public services and the individuals that count on them of a degree of expertise and reach that often cannot be found in larger organisations…”
This situation hasn’t gone unnoticed. The government has announced new measures designed to correct the problem, give smaller charities a better chance of winning public sector work, and so support the skills and quality of service that they offer.
Three steps to climb the public contract mountain
The plan, announced by Minister for Civil Society, Rob Wilson, has three parts.
The first is “Public Services Incubator”, aimed at helping smaller charities collaborate with public sector contract commissioners, developing the services that they offer to better meet demand.
The second element is a “kitemark” scheme to set up best practice in public sector tendering, encouraging commissioners to make the bid process more accessible to smaller organisations.
The third and final step is to appoint a new crown representative for voluntary, community and social enterprise. This role will be dedicated to standing up for practices that help smaller charities competing for government and council contracts.
While these moves are welcome, it may take some time for the positive effects to filter through and make a difference in the real-world bidding process.
Find out how more about how smaller charities and social enterprises can grow by attending our Invest for Impact roadshow.