SMEs and open source providers could miss out on £3bn government tech spend

The government's procurement service division, Buying Solutions, has begun advertising for telecoms services for central and local government departments worth up to £3bn as part of the newly created Public Services Network (PSN).

Information announcing the framework explains that it covers technologies including call centre and conferencing systems, mobile voice and data services, paging systems and local area network equipment.

The PSN is designed specifically for the delivery of communications equipment and services, and is aimed at increasing the procurement options for government departments by increasing the number of potential suppliers from which buyers can choose.

Under the new framework, any company can become an approved supplier as long as it meets certain criteria, and 100 firms are already on the system. The old system allowed departments to purchase only from a handful of selected companies.

The government added that the framework will enable large organisations and SMEs to get involved and offer services that will be accessible to central government departments, local authorities, the NHS and non-government public organisations.

Edward Hamilton, a public sector analyst at Analysys Mason, told V3 that, while the government claims that the framework opens government tenders to SMEs and open source players, the same barriers will still exist.

"Open source firms and SMEs now have a better chance of making it onto the preferred suppliers list for approved government vendors, but buyers are still going to favour larger firms that have experience with large contracts," he said.

"If a firm has a low cash flow buyers are going to think twice when handing out multi-million pound contracts, and open source firms will still have to compete with firms like Microsoft on the approved list."

Changing the way departments procure IT services has been a key priority for the government since coming to power, but figures released under the Freedom of Information Act on Monday underline the struggle it faces.