Councils urged to do business with small IT firms

Councils have been urged to employ the services of small businesses in a bid to save money as e-government schemes are rolled out.

A report from the Department of Trade and Industry (DTI) highlighted small IT firms as one example of suppliers that can provide better value contracts to councils.

Small business minister Alun Michael said small firms can offer better levels of service to local authorities than larger companies.

He said in a statement: "The public sector need not miss out on the better value and more innovative approaches small businesses can offer. I urge local authorities to adopt improved procurement practices and to encourage them to reap the benefits of a diverse supplier base."

The report cites 20 case studies, some of which highlight small firms providing IT services. The DTI admits in the report that increasing the number of suppliers to a council would require extra effort but said it could also reward local economies.

The report said: "[T]he most striking feature of the studies is the commonality of nearly all the firms in respect of quality of service (for the same or lower cost), in specialism (which is particularly, but not only, relevant in IT and professional services) and in adding to competition for public contracts."

The Office of Government Commerce is currently running a training scheme for public sector staff aimed at highlighting the benefits of working with small firms.