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  1. Government Computing
May 11, 2023

SMEs could lose out after UK government shutters Digital Marketplace

Experts say that SMEs could be locked out of public sector tenders due to lack of transparency and complexity of the new system.

By Sophia Waterfield

The closure of the Digital Marketplace for procuring government contracts could make life more difficult for businesses seeking to work with the public, experts believe. One told Tech Monitor that a new portal set up by government procurement agency Crown Commercial Service (CCS) makes it harder for SMEs to know what opportunities are coming up, leading to some being locked out of the bidding process.

Two hands shaking over a paper contract on a table.
Digital Marketplace closed in April and was replaced by Public Procurement Gateway. Photo by Shutterstock.

Launched in 2014 by Government Digital Service (GDS), Digital Marketplace was an online platform that was used by public sector organisations to find people and technology for their digital projects. Suppliers included cloud hosting, physical data centre space for legacy systems, digital specialists, accessibility audits and user research participants.

However, the platform was closed a month ago and replaced by the Public Procurement Gateway (PPG). This single-point-of-entry portal was brought in as CCS felt the technology for the Digital Marketplace was not fit for purpose. It also had issues with G-Cloud 12 submissions, where Digital Marketplace was down for four hours on the submission day, resulting in companies being unable to apply for the framework, through which many government departments buy cloud computing services.

PPG and CAS are making procurement more difficult

What’s more, the Digital Marketplace portal could only be used for submissions, with other parts of the procurement process such as evaluation, award and contract drafting being done manually through email or separate document systems.

Nonetheless, the system’s openness and transparency means many believe the move to PPG and the supporting contract award service (CAS) isn’t the right one, and early experiences have not been positive.

Chris Farthing is CEO of Advice Cloud, which advises public sector organisations on cloud deployments. He told Tech Monitor that feedback from users on the new system has not been glowing. “I don’t know of any buyer that says that their user experience and workflow has been improved by any of the changes,” Farthing says. “Absolutely no suppliers are in favour of the new systems.”

But he explained that the second issue with PPG and CAS is the lack of transparency. “Moving from a formerly world-leading open and transparent procurement platform to a fated, hidden service is not the sign of a healthy understanding of the meaning of transparency,” he says

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Other users have expressed similar concerns, citing that the newer PPG has a “poor user experience” and that it took multiple steps to get to the Bravo portal. It is thought that for SMEs, this experience could hinder them in submitting and winning tenders.

“The current signs aren’t great and it does seem like we’re heading back to the old days of large system integrators and the Oligopoly,” said Farthing. “The lack of transparency is always a worry and CCS doesn’t seem to be in too much of a hurry to solve that or at least communicate what they are doing. They really don’t seem to like working in the open.”

GovTech SMEs ‘will lose out’ to Big Tech

A survey by techUK’s GovTech team earlier this year found that over half of their respondents believed that Digital Marketplace was helping to improve SME access to public sector opportunities, but 90% said that the government didn’t have a “sufficient understanding” of how SMEs could meet the needs of central government and the civil service.

Speaking to Tech Monitor in April, Rob Anderson, public sector research director at Global Data, explained that the government had a long way to go in working with SMEs: “The Government seems to have lost focus on the direct SME agenda,” Anderson said.

According to the British Chambers of Commerce (BCC), just over one in every five pounds (21%) spent by government on public sector procurement in 2021 was awarded to SMEs. However, in the financial year of 2021 to 2022, the top 10 government suppliers mainly included large tech companies such as Capgemini, Atos, Fujitsu, IBM and Capita.

Anderson pointed to the civil service’s risk aversion culture and that it was pushing contracts back into the hands of Big Tech. However, he was hopeful that the House of Lords Procurement Bill, which is currently with the House of Commons, could make it more simple for GovTech SMEs to bid.

But with the current version of PPG and CAS, Advice Cloud’s Farthing is less optimistic. “I think its tremendously sad to see a world-leading and a much admired transformative piece of procurement allowed to stagnate in this way,” he says. “It will not be good for the economy and Government technology will be the poorer for it.”

CCS: lack of transparency is ‘temporary’

According to CCS, the Digital Marketplace was not able to accommodate the growing demands of customers. The government department told Tech Monitor that the CAS was developed as an “enhanced digital platform” to support future iterations of the Digital Outcomes and Specialists framework (DOS).

When Tech Monitor questioned the department on how it was addressing concerns over transparency, a spokesperson said that the digital CAS was both “flexible and scalable” and would provide a full end-to-end digital experience. They also said that CCS was committed to providing transparency information for G-Cloud and DOS, which they believe is essential to support “competitiveness and ensure suppliers are able to continually increase their capabilities and experience of working with public sector organisations.”

The spokeperson added that the decision to “temporarily suspend” transparency functionality was taken so that the launch of G-Cloud 13 was not delayed. It is working to reinstate the transparency function and “further develop” the process for buyers and suppliers.

CAS, they said, will continue to evolve through an “iterative process” that will be informed by supplier and buyer feedback.

Read more: The UK’s new national fraud strategy doesn’t got far enough

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