Albanese doubles SME share of government spending

The federal government has dramatically boosted the share of government procurement earmarked for Australia’s small and medium sized businesses.

Finance minister Senator Katy Gallagher and small business minister Julie Collins announced revisions to the Commonwealth Procurement Rules (CPRs) on Friday that will double federal spending available to SMEs.

The new CPRs now require that 20 per cent of procurements by value are sourced from SMEs.

This is an increase from the previous target of 10 per cent and will open the door to more government work for SMEs.

Each year the Australian Government spends approximately $70 billion a year on contracts.

Value for money is at the CPRs centre. When assessing value for money officials must consider the relevant financial and non-financial costs and benefits of each proposal.

The revised CPRs now require that procuring officials consider a procurement’s broader impact on climate change – a change in line with Canberra’s commitment to reduce emissions by 43 per cent by 2030.

The CPRs also encourage entities to approach multiple suppliers, when procuring from a panel arrangement.

The government said that adopting the change improved competition, drove value for money outcomes and ensured a better deal for the taxpayer.

Senator Gallagher said: “This announcement is a clear demonstration that we won’t waste time when it comes to taking practical steps to support businesses to grow, create more jobs and ultimately help to boost the Australian economy.

“This is the first step in delivering on our Buy Australian Plan and we’ll have more to say about implementing this key element of Labor’s plans to build a future made in Australia.”

Julie Collins said small businesses shouldn’t be locked out from opportunities to gain government contracts just because they might not have the leverage of bigger businesses.

The updated Commonwealth Procurement Rules are now online and will come into effect on 1 July 2022.

Picture: Senator Katy Gallagher

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