With the new guidelines, these sectors will be considered of critical importance, and priority will be given to protecting national security in public contracts awarded to UK businesses.
The government plans to prioritize resources that will enhance resilience across the country, following the recent exposure of vulnerabilities in global supply chains. For contracts exceeding GBP 1 million, departments will assess whether the work can be carried out more effectively in-house. Companies will also be encouraged to offer local employment, skills development, and apprenticeship programs to strengthen their bids and support the Modern Industrial Strategy.
Under additional requirements introduced for the steel sector, departments will either use UK-produced steel or be required to provide justification if sourcing steel from abroad. This measure also supports the UK Steel Strategy announced last week. The new measures will be implemented to safeguard national security, support UK businesses and workers, reduce waste, and ensure more efficient use of public spending.
Cabinet Office Minister Chris Ward stated that the reform package covers all UK businesses and workers, emphasizing that government spending should go beyond simply purchasing goods or services and should contribute to job creation, skills development, and strengthening communities. Under the new Public Interest Test, it will be assessed whether outsourced contracts exceeding GBP 1 million could be carried out more effectively in-house.
Departments will also publish and report annually on social value targets for contracts exceeding GBP 5 million. This process will cover more than 90% of central government contracts. To streamline the commercial process, new AI-based tools will be developed, contract terms will be simplified, and bidding processes for small businesses will be managed through a centralized platform.
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