Local Authority Procurement: Economic Growth

I welcome the House’s continuing passion for procurement, and my hon. Friend has helped to lead the way in this area at Hammersmith and Fulham council. I have seen how much energy there is in local government to use procurement to deliver jobs and growth. The Government are working on plans to allow local authorities to reserve contracts for local employers. Public procurement can be a key tool in driving growth and supporting businesses across the economy. Our new national procurement policy statement looks to maximise spend with small businesses and asks contracting authorities to work collaboratively on local and regional growth plans.

I thank the Minister for her reply and for the excellent work she has done in putting together the procurement strategy. It has been a passion of mine for many years that we do not use procurement just to get extra social value but extra economic value, which will help local firms and local growth. That is what this statement does, and I hugely welcome it. May I ask the Minister whether she intends to issue guidance to local authorities so that they know how best they can achieve economic value? For example, they could proactively tell small firms what contracts are coming up or train them in how to tender, which is very difficult for them. The Government could also encourage local authorities to break procurement into lots, so that small firms have a better chance of bidding. Finally, local authorities could stop requiring an unreasonable number of years of accounts to be shown before small firms are permitted to bid.

Growth is the No. 1 mission for this Government. We have learned from local authorities such as Hammersmith and Fulham, which built economic value into procurement. The Procurement Act 2023 makes new tools available, but what is critical is how they are used to deliver innovation and growth. The Government will be consulting on new plans to set targets for small and medium-sized enterprise use for the wider public sector. We have delivered extensive training and developed new communities of practice to help make the most of this huge opportunity. As my hon. Friend has said, much of this is about culture and the use of the tools. We will be working with local authorities around the country to deliver on this enormous opportunity.

My constituency is a food production powerhouse, and I welcome any steps by the Government to encourage local authorities to procure British-produced food. Local authorities are under extreme pressure to procure at very low cost. What steps is the Minister taking to ensure that, first, the Groceries Code Adjudicator ensures that farmers are paid fairly for the food they produce and, secondly, the Department for Business and Trade is not about to undermine the food they produce by entering a damaging trade deal with the US that would undermine those standards?

The guidance we put into the national procurement policy statement makes it clear that we want to deliver best value for money, which means not just cost but ensuring that we support growth and local suppliers. That allows local authorities to make decisions on what will create jobs and best opportunities for communities in the procurement of food.