Procurement rethink campaign gains pace in the North East

A campaign calling for a rethink over the procurement of public sector construction work is quickly gather momentum

Last week, the region’s three largest independent contractors – Newcastle’s Surgo Construction, County Durham’s Esh Group and Gateshead’s Tolent – wrote to all northern MPs and Government ministers pointing out how the current strategy favours huge national firms over regional ones, hitting the North East economy and resulting in a poor deal for the tax payer.

Today, Liberal Democrat peer Lord Shipley raised the matter in the House of Lords and a number of North East MPs are also joining the calls for change.

The North East Chamber of Commerce likewise plans to lobby at national level, while Mark Thompson, managing director of Ryder Architecture, which has an office in Newcastle, intends to open discussions with the CBI’s Construction Group.

John Wood, chairman of Tolent, said he was encouraged by the support, adding: “I have been beating the drum about this for a long time; what’s going on is scandalous.

“This industry is probably the hardest hit by the recession.”

The companies’ concerns revolve mainly around the Scape framework for public sector procurement and the Government’s Priority Schools Building programme, both of which, they say, discriminate against smaller companies bidding for work, regardless of their competence.

Meanwhile, the dominance of larger national companies means income generated often disappears to the south of England, where many are headquartered, while employment opportunities in the North East dry up.

Gateshead MP Ian Mearns said: “My sympathies are with the contractors who make a strong case, which I have asked the Government to reply to in detail.

“They make a very strong case for amending public procurement policy to make sure that there is proper competition and more companies like Tolent, which is in my constituency, can compete for contracts.

“It's not possible to rebalance the economy by excluding significant regional-based businesses.”

Blaydon MP Dave Anderson said: “I am delighted to support this cause.

“The Government's hands off approach is exactly what we don't need .

“There should be an in-built presumption that regional firms are given priority unless there is an overwhelming case against them.”

Jarrow MP Stephen Hepburn, meanwhile, has written to Business Secretary Vince Cable requesting a explanation of the Government’s public procurement policy.

“It seems to be ludicrous that good regional companies capable of doing the job are excluded in this arbitrary manner,” he said.

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