Alison McGovern, Minister of State for Local Government and Homelessness
BOUNTY FOR SMALL BUSINESSES
Small businesses stand to gain £ 1bn annually through new regulations enabling local authorities to reserve certain contracts for suppliers within their area.
The measure aligns local authority flexibility with February’ s National Procurement Policy Statement, which encourages public bodies to deliver broader social and economic value through their contracting decisions.
These reforms are part of ongoing efforts to stimulate growth by reducing commercial bureaucracy, streamlining public procurement processes and lowering barriers for smaller firms seeking government contracts.
Chris Ward, Parliamentary Secretary at the Cabinet Office, said:“ We’ re changing the rules that have held back councils from investing in local businesses that are the lifeblood of local economies.
“ This will put power back in the hands of our communities to drive growth, unlock skilled jobs and create local investment that rewards working people.”
The changes allow councils, fire and police authorities in England to limit competitions for lower-value contracts to UK-based suppliers or those operating within a specific local area.
Alison McGovern, Minister of State for Local Government and Homelessness at the Department for Housing, Communities and Local Government, added:“ We want councils to help create jobs, opportunities and growth right across the country.
“ Making sure they can prioritise our brilliant local businesses is a huge step forward in achieving that and will mean more money going to firms that know their areas best and can invest in the communities they serve.”
110 February 2026