Change to procurement rules
1 Nov 07
Government announcement will allow suppliers to use an intermediary to raise finance
The procurement rules for public sector contracts are to be changed, a move that will help small and medium sized enterprises according to the Scottish Government.
Cabinet Secretary for Finance and Sustainable Growth John Swinney said the change to the government's contract rules will allow suppliers to use an intermediary to raise finance without prior permission.
Mr Swinney said: "We can make a significant contribution to sustainable economic growth by reducing barriers to public contracts and making it easier to do business. This government listens, and this is a good example of what can be achieved when we listen carefully to the views of our regulatory advisors in business."
Andrew Watson of the Federation of Small Business Scotland said: "Removing unnecessary restrictions like this can make a real difference to a small business. This simple rule change will allow those businesses which use factoring services to bid for public sector contracts, improve competition and ultimately deliver better value to taxpayers."
The Cabinet Secretary also announced that he would chair the Public Procurement Reform Board to accelerate the pace of reform in procurement - worth £8 billion every year.
An estimated 1,600 businesses in Scotland use factoring or invoice discounting. The total value of finance raised in this way by Scottish businesses in 2006 amounted to around £500 million.