Every year the government spends around £400 billion on public procurement, and for far too long this spending has been focused too narrowly on short-term requirements and upfront costs.
This has left the UK exposed to global shocks, with recent events showing the fragility of global supply chains. This new guidance draws a line under that approach and works to protect the UK’s national security and build resilience in critical sectors.
Through the new guidance, the Chancellor, alongside the Chief Secretary to the Prime Minister, highlight the power of public spending to safeguarding sovereign capability, supporting businesses, jobs, and skills across the UK, with real money going straight to communities from Farnborough to Huddersfield, and Edinburgh to Solihull.
The Chancellor will also today confirm that British founded-firms have already seen a £5 billion surge in new government contracts since March, targeting high-growth sectors central to the Industrial Strategy.
Since March, the government has awarded a number of new deals to British firms including:
Up to 450,000 disadvantaged pupils are set to benefit from future-generation technology in AI tutoring from 2027. Six British organisations are among those selected and will receive £1.8 million to help build the next generation of safe and effective AI tutoring tools that will set the global standard for effective AI models.
Mayoral Strategic Authorities are also playing a crucial role in the new push, such as with West Yorkshire Combined Authority and Greater Manchester Combined Authority procuring new local electric buses and steel from UK businesses.
New guidance on national security and resilience
The new guidance sets out the process for departments to use the national security exemption within the Procurement Act 2023 in key sectors to support the country’s national security and economic resilience. To support this new approach, the government has appointed dedicated Sector Leads in key departments across Whitehall.
These Leads will support Ministers and oversee upcoming procurements, so they can appropriately apply the national security exemption for contracts - supporting national security and stronger supply chains, while helping ensure the UK is better prepared in an increasingly uncertain world.
Alongside this, the Treasury will be writing to accounting officers across government on the importance of protecting national security through future spending decisions. This will provide guidance on the use of the exemption to deliver value for money.
Both new pieces of guidance are consistent with our international trade agreements and complement the government’s work with international partners to improve the security and resilience of key sectors, ensuring that we can collectively respond to global challenges.
This includes recognising that our global trading partners and close allies will often have suppliers well-placed to help us meet our security needs. Our approach is built on collaboration; trusted international partners and global suppliers are at the heart of our procurement strategy, bringing the innovation and resilience we need to stay secure.
The government also announced the publication of the Supply Chain Centre’s mission statement and action plan this week, setting out a new cross-government approach to securing the inputs the UK economy relies on and boosting supply chain resilience.
Source: UK Government: https://www.gov.uk/government/news/government-procurement-to-prioritise-national-security
The Critical Supply Group consists of companies and professionals committed to secure and resilient critical supply chains. CSG is managed by MAP UK & International. For more details, including how to get involved, or to make contact with any of the entities involved, please email info@mapukinternational.com.