Huge gap revealed in number of government contracts awarded to London firms compared with Yorkshire's

Government contracts have overwhelmingly been awarded to firms in London and the South East to the detriment of the North, new figures have revealed.

Labour MP Gareth Thomas has claimed there is a “procurement bias” towards the two areas in regards to the most lucrative Government contracts.

Data requested from the House of Commons library by Harrow West MP Mr Thomas, and seen by The Yorkshire Post, showed how between 2017 and 2020 London received 772 out of 2,879 contracts deemed large enough to be listed in the EU’s Tenders Electronic Daily (TED) database.

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An intensive care unit in London at the height of the pandemic. Pic by PA

Before the UK left the EU, as part of the bloc’s rules, Governmental contracts above certain values had to be published on the TED database. For public works the threshold is €5,350,000 (around £4,575,052), and for service and supplies contracts €139,000 (around £118,865).

Companies in the South East bagged 642 of these contracts between 2017 and 2020. While Yorkshire firms received just 210, the East Midlands 163, and the North East only 66.

Mr Thomas said the data showed there was still a huge gap between the North and South, and said this had become particularly stark during the Government’s buying of personal protective equipment during the pandemic.

But the Cabinet Office said now that the UK has left the EU, new proposals would make it easier for firms in areas such as Yorkshire to win Government contracts.

And since January this year “social value” - such as how contracts can tackle economic inequality - should be explicitly evaluated in all central Government procurement.

Mr Thomas said: “These figures demonstrate that ten years after the Conservative government came to power there is a huge divide in which parts of England benefit from the deals Ministers do.

“The Government still has no plan to tackle the huge gap in which region of England benefits from its biggest contracts. It’s time that changed.”

While director of the Northern Powerhouse Partnership lobbying group Henri Murison added: "If government wants to avoid missing the opportunity to place major contracts and services here in the North, it's critical they replicate more recent success stories such as the new Piccadilly Line train.

"This was ordered by Transport for London under the oversight of the Mayor of London and will be built at Siemens' new factory in Goole, opening more avenues for further work there in the future.

"Investing in the supply chain here in the North can act as a linchpin to driving a Northern recovery and rebalancing the economy post COVID, creating jobs and unlocking growth.

"Building a more productive Northern Powerhouse means maximising the economic opportunities from our unique assets and expertise in sectors such as energy and advanced manufacturing. It's why it is vital we build using green steel in all infrastructure projects moving forwards."

In 2020 alone the figures showed 615 out of 1,162 of the contracts went to companies in London and the South East, with the other 547 being shared between the other seven regions in England.

Last year Yorkshire got 86 contracts - an increase on the 29 the year before.

Mr Thomas has introduced a Bill in the Commons which would require ministers to publish more detailed data on where firms winning contracts are based, and would create a presumption in favour of British companies winning contracts.

A Government spokesperson said: “As part of our levelling up agenda, we are determined to reform the way government contracts are awarded to make sure that businesses of all sizes across the UK benefit.

“The Procurement Green Paper, which was published in December, sets out how leaving the EU provides us with the opportunity to overhaul the public procurement regulations which govern how some £292bn of taxpayers money can be spent.

“Our proposals will slash red tape and simplify the processes for bidding for contracts, making it easier for small businesses in Yorkshire and across the UK to secure government contracts and guarantee public services are delivered in the most innovative way, while always providing value for money."