That big UK gov leg up for small biz: SMEs bag just 1-in-10 G-Cloud deals

Can't open door to taxpayer cash with all this paperwork in the way, complain bosses

Small businesses have taken just 10 per cent of government IT contracts available from public-sector shopping catalogue G-Cloud.

That's according to a group formed to give Whitehall feedback on actions that could boost SME involvement. The target figure is 25 per cent.

Fronted by managed hosting and IaaS provider Memset, the band of SMEs known collectively as the 10% Group also includes cloudy firms Asidua, Automated Intelligence, Hao2, Digi2al, Magic Milestones and Shaping Cloud.

The G-Cloud was billed by the Cabinet Office as a way to loosen the grip of 18 big vendors and integrators that in 2011 bagged 80 per cent of public-sector technology contracts.

Progress has been painfully slow: suppliers have moaned that the amount of business booked via the CloudStore, Whitehall's web catalogue of services offered by approved suppliers, was woefully poor in the first iteration of the scheme.

As of the end of June, some £31.1m had been spent by public-sector departments on cloud-based services offered by private businesses under G-Cloud. According to Memset's estimates, just 10 per cent of this went to small and medium-sized firms.

The issue, it's understood, is that government security and G-Cloud accreditation red-tape has blocked the cistern system for small players.

Memset claimed the government's Public Services Network is not handing out IL3 security passes to small private firms who want to pick up work via the G-Cloud, and that the accreditation processes are "very labour intensive".

In addition to the 10% Group being asked by the Cabinet Office to give feedback, Memset boss Kate Craig-Wood is also representing Brit cloud SMEs at the European Cloud Partnership steering board.

"I am collating the views, issues, troubles and successes of these groups and feeding them back into Intellect, the Cabinet Office, G-Cloud programme and ECP," she said.

The Cabinet Office says it wants SMEs to account for 25 per cent of public sector spending by March 2015. It confirmed this week that across government they currently represent 10.5 per cent, not the 13.7 per cent it spoke of in March '12.

Asking public sector tech buyers to use the G-Cloud first for procurement and directing 50 per cent of all new spending via SMEs are several initiatives rolled out by government to help it achieve its spending goal.

But manipulating statistics by working with tech vendors, integrators and their legions of small biz sub-contractors may be another option that Cabinet Office has at its disposal before the next general election.

We are awaiting comment from the Cabinet Office.


A Cabinet Office spokesperson has been in touch, claiming that 56.4 per cent of all sales on G-Cloud by value, and 61 per cent by volume, were transacted with SMEs.

"We anticipate that our cloud first policy will result in 50 per cent of new central government IT spend being procured through the CloudStore by 2015," he said. ®

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