Government will back British industries such as energy, steel and
cyber - giving them more of the £400bn spent on government
procurement each year and protecting our national security.
A consultation launching today will consider new rules to give
the government greater power to back our national security
through government buying and ensure the country retains a
strong, homegrown industrial base.
The plans will allow Ministers to designate certain UK industries
as nationally important to protecting UK national security – as
part of our Plan for Change to secure Britain's future.
Current rules require public sector buyers to consider bids from
overseas suppliers that can undercut UK firms. Under the new
designation, public sector buyers will be able to avoid normal
buying rules to support national security, and award contracts to
our industries.
Chancellor of the Duchy of Lancaster, said:
“Strong industry is essential to our national security. The new
rules being considered will give us the power to protect
our national industries, ensuring more money goes to them as we
buy goods and services in government.
“Our reforms will boost growth and ensure British industry is
supported to deliver national security and our Plan for Change.”
The move aims to harness the £400 billion spent by central
Government each year on everyday products and services to boost
British business - as the government rebuilds the country in a
decade of national renewal and delivers the Plan for
Change.
The changes come following the publication of the government's
Industrial Strategy which set out a ten year plan to boost
investment, skills and jobs and reduce the energy costs for
business and industry.
New guidance will also require Government departments to consider
UK-made steel in all future public projects, including those that
form part of the £725bn of UK infrastructure spending over the
next 10 years.
Minister for Industry, MP said:
“This is the latest win for our Steel Strategy, supporting jobs
across the UK and building on the launch of our modern Industrial
Strategy which will cut energy costs for steel firms.
“By strengthening our procurement to back British industry,
we'll not only bolster national security but drive growth by
filling up companies' order books across the UK. Supported by up
to £2.5 billion, our upcoming Steel Strategy will set out how
we'll boost growth and investment in the sector even further.”
Cracking down on late payment and supporting SMEs
The new rules will also ensure public sector buyers exclude
companies that cannot evidence a good record of paying businesses
in their supply chains promptly and on time.
Prompt payment is vital to a small business' success, as they
work to tight margins. By ensuring government supply chains are
paying them quickly and on time we can remove uncertainty and
fuel growth.
Alongside prompt payments, new rules will be introduced that
would require all large contracting bodies to set three year
targets for SME spending.
The government previously announced that Government departments
would have targets, and this expands that requirement to the
wider public sector. Further prioritising and boosting spending
with SMEs.
Supportive quotes;
Gareth Stace, Director-General of UK Steel said:
“This is unequivocally positive news for the UK steel industry.
These changes rightly recognise the strategic importance of
steelmaking to national security and the vital role of resilient
domestic supply
chains.
“With the launch of the National Infrastructure Strategy and
Strategic Defence Review, the next decade presents a generational
opportunity for our steel industry. This revised guidance and
proposals in the consultation will help government departments
unlock the full capacity and capability of our members,
supporting jobs and driving investment across the
country.”
ENDS
NOTES TO EDITORS:
-
Today, the Government has also published its annual steel
procurement data. This includes a pipeline of infrastructure
projects over the coming decade, which shows that
infrastructure projects will require at least 7.5 million
tonnes of steel over the next decade.
-
The publication also shows the Government reported procuring
around £599 million worth of steel in financial year 2023/24,
illustrating the significant role of public contracts to the
steel sector. The data is available here: https://www.gov.uk/government/publications/steel-public-procurement-2025
