The government has failed to open up public procurement to charities and social enterprises, which risks creating another Carrillion collapse, warned Social Enterprise UK today.
Just 12 per cent of contracts deemed suitable for voluntary, community and social enterprise organisations were actually won by such organisations in the first quarter of 2018, according to SEUK’s analysis of data provided by Tussell, a data aggregator.
Community Interest Companies, the legal form for approximately 20 per cent of social enterprises, won just 69 contracts in Q1 of 2018, accounting for just 0.4 per cent of all public procurement. This is just a 6 per cent increase on two years’ ago.
SEUK says the analysis shows that there has been a lack of progress and it has called on the Cabinet office to “go back to the drawing board”.
Charlie Wigglesworth, deputy chief executive of SEUK, said: “This research shows that the government is failing to open up public procurement to a wider pool of providers. This means that they are losing out on the benefits of working with social enterprises, which reinvest their profits back into the communities they serve leading to better outcomes.”
“We must learn the lesson of Carillion which is that public procurement is not sufficiently diversified. Social enterprises are proven to deliver at a local and national level, but government is not doing enough to build partnerships with them. The Cabinet Office needs to go back to the drawing board and work with social enterprises to change this picture before we see another Carillion-style failure.”
This is the first time that SEUK and Tussell have attempted to measure the presence of community interest companies in government procurement and plan to carry out the benchmarking exercise every quarter.
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