Council spend gives £45M boost to economy

Graham Bell, FSB Borders chairman
Graham Bell, FSB Borders chairman

For every £1 spent by Scottish Borders Council (SBC) on procurement, an estimated 43.4p goes into the local economy, new research has found.

In 2012/13, the council spent around £104million on goods and services, with almost a third going to businesses and organisations in the Borders, according to a Federation of Small Businesses (FSB) study.

David Simpson of Network Rail; David Parker, Councillor Bob Constable, Leader of Midlothian Council; and Transport Minister Keith Brown

David Simpson of Network Rail; David Parker, Councillor Bob Constable, Leader of Midlothian Council; and Transport Minister Keith Brown

This meant that more than £45million was ploughed into the local economy by the council last year, £32million directly and an additional £13million through the associated spend of suppliers.

The report, written in conjunction with the Centre for Local Economic Strategies, is based on detailed survey work with local authorities.

It found the average Scottish council spent 27 per cent of its procurement budget in its own area, with the UK average 31 per cent.

In the report, a case study focuses on SBC’s work to make it easier for local firms to win council contracts, including splitting them into smaller chunks and running events to help potential suppliers understand what is required during the tendering process.

Graham Bell, FSB Borders branch chairman, said: “It is great news for local businesses to see that SBC are spending more of their procurement budget locally than the average for Scotland, but there’s still work to do.

“The case study goes on to show that the council are actively looking at their local spend and its effect on the local economy through re-spending and I’m pleased to see this level of analysis.

“Of vital importance on really big contracts, such as the Borders Railway, are the sub-contract opportunities more typically within reach of local small businesses, so it is good to see the council encouraging prime contractors to look at these opportunities too.”

Council leader David Parker said: “I am pleased that this research has demonstrated that the council has a good track record in making best value use of local small businesses when we procure goods and services.

“I am hopeful we can continue to improve this in the future, to the benefit of local taxpayers and the local economy.”