New techUK report reveals barriers facing tech SMEs in navigating social value in government procurement
[LONDON, UK] 24 April 2025 – A new report released today by technology trade association techUK shines a spotlight on the growing challenges faced by technology SMEs as they attempt to engage in public sector procurement amid increasing expectations to deliver social value.
The report - "Navigating Social Value: Challenges Facing Tech SMEs in Government Procurement" - builds on the findings of techUK’s seventh annual GovTech SME Survey and draws on new insights from over 100 tech SMEs operating within central government procurement frameworks.
While the government has made strides in embedding social value into procurement processes - most notably through the 2020 Procurement Policy Note 06/20 which mandated a 10% minimum weighting for social value in central government bids - the report reveals that many SMEs still feel locked out of opportunities due to systemic barriers.
Key findings show:
73.1% of SMEs report difficulty in formulating social value commitments in central government tenders.
71.6% feel there is a lack of meaningful engagement with government on shaping relevant, measurable social value criteria.
54% say they are unable to effectively showcase their capabilities within the current framework.
Only 67.5% believe the government is even slightly committed to genuinely delivering social value, suggesting a disconnect between policy and practice.
These difficulties add to other major barriers identified by SMEs when engaging with public sector, including lack of resources and funding compared to large enterprises; scale limitations leading to unfair comparisons in tender assessments; lack of insight and previous experience, making compliance and innovation difficult; and ambiguity and inconsistency in how social value is scored across departments.
Recommendations for reform
To address these challenges, techUK is calling on the government to take four key actions:
Establish a clear, centralised set of guidelines for how social value is to be integrated and evaluated in procurement.
Enhance engagement with industry, including regular dialogue between government, SMEs, and larger suppliers.
Monitor the impact of the mission-led approach to social value on SMEs using qualitative, SME-led data.
Publish annual departmental reports on social value performance, offering transparency and a roadmap for continuous improvement.
Heather Cover-Kus, Head of Central Government, techUK said:
“SMEs are confident in their ability to deliver high-quality services, but current social value requirements risk putting them at a structural disadvantage.
“With the right frameworks and support, SMEs can be empowered to drive meaningful outcomes for communities and public services alike, ensuring this policy works for all players in the digital economy.”
Notes to Editors
The full report can be downloaded here.