MINISTRY OF DEFENCE
News Release (085/2007) issued by The Government News Network on 30
The Ministry of
Defence has today launched a new initiative to help Small and
Medium Enterprises (SMEs) to win more defence contracts.
From 30 April 2007, the threshold value for advertising MOD
contracts will be lowered. This will encourage more competitive
bidding for a wider range of defence business and encourage
greater innovation from industry.
Lord Drayson, Minister for Defence Equipment and Support, said:
"We are committed to making the Ministry of Defence
SME-friendly. This is one of a range of initiatives aimed at
making its easier for small and medium companies to do business
"SMEs play a crucial role in UK defence business and
represent a significant core of direct suppliers to MOD. In 2005,
just over half of all MOD contracts let were placed with SMEs, to
the value of over half a billion pounds. Today's announcement
is a significant development and one which I am convinced will
further promote a dynamic and competitive supplier base."
From 30 April, the threshold for 'warlike' requirements
will be lowered from £500,000 to £93,000; then on 30 June 2007,
lowered again to £40,000. The threshold for
'non-warlike' requirements will also be reduced on 30
June 2007 from £93,000 to £40,000. Furthermore, from the 30 June,
MOD project teams will be encouraged to consider advertising
requirements with values as low as £20,000. This change could
generate up to 7,000 additional adverts a year.
This change is in line with one of the key themes of the Defence
Industrial Strategy and reaffirms MOD's commitment to working
Notes to editors
1. For more information - http://www.mod.uk