The pre-election budget gave a nod to small and medium-sized businesses when it comes to procurement opportunities and the “pieces of the Federal Government contracts’” pie being evenly shared.
To help smaller contractors compete against larger proponents, government departments are being told to break major projects into smaller components.
Reduced insurance costs for SME suppliers will mean the insurance requirement for companies is removed during the bid process until a contract is awarded.
Finance Minister Simon Birmingham said the changes unveiled in the budget would give SMEs a boost in the government procurement market, Smart Company reports.
“These reforms are game changers that will remove perceived barriers that may have discouraged some SMEs from participating in particular tenders, particularly where they think the cost of entry is too high,” Birmingham said.
“This is all about enhancing the commercial opportunities for SMEs and allow more suppliers to offer their services for the benefit of taxpayers.”
The finance minister outlined the feds commitment to giving Australian contractors “the maximum opportunity” to win work.
He said “unbundling major projects” would give a better bang for the taxpayer dollar, and support local job opportunities.
In defence procurement, the department will be permitted to purchase directly from SMEs or use tenders for SMEs for contracts worth up to $500,000.
A $270bn 10-year defence capability plan was announced bringing the total funding to 2029-30 to $575bn.
Some of the multibillion dollar investments as part of the UK-Australia-US Defence agreement UKAUS include:
- an east coast submarine base
- a large-vessel dry berth in Perth
- upgrades and sustainment works across major defence sites, supporting 1,600 jobs.
A $9.9 billion investment over the next decade was also unveiled for new national cyber and intelligence capabilities.
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