Government needs to encourage small businesses to grow, says the IET

Engineers call on government to encourage growth of SMEs

Engineers have urged the government to encourage greater use of the Small Business Research Initiative to drive economic growth.

The Small Business Research Initiative (SBRI) was established in 2001 to be a key tool in helping to promote the growth of small businesses and start-ups, particularly those in the high-tech manufacturing sector.

At a parliamentary debate on government procurement and manufacturing last week, organised by the Associate Parliamentary Manufacturing Group, a number of issues were identified as barriers to greater use.

These included over specification in tenders, an overly risk-averse culture, and an obsession with using restricted procurement procedures.

The coalition's key pledges on public sector procurement, including a pledge to award 25 per cent of government contracts to SMEs, have not been accomplished but could be through greater use of the SBRI, which requires a greater awareness of the Initiative.

“SBRI is an important way to develop innovative, high-tech solutions to help rebalance the economy toward advanced manufacturing exports, one of the Coalition’s stated aims,” said Chris Richards, Policy Advisor at the Institution of Engineering and Technology (IET).

”The SBRI needs to be more widely promoted because it helps to manage procurement risk, foster innovation and grow SMEs.

”A similar scheme in the US has seen those awarded contracts grow at five times the rate of comparable businesses.”

Mark Prisk MP, who gave a talk at the IET in May, said at the time small businesses were “absolutely vital to driving growth in our economy.”

The SBRI was established to help innovative SMEs develop new products and services to help the public sector achieve targeted objectives.

Following a process of open competition R&D contracts are awarded to businesses proposing the most promising concepts in solving the problem posed, with further funding awarded to test the concept, to companies showing the best solutions.

The scheme is managed by the Technology Strategy Board (TSB).

The IET makes a number of recommendations in its policy paper, including that the government encourages greater use of the SBRI via financial incentives for public bodies and that a similar scheme should be explored at the EU level.

Further information:

See the IET website

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