Network Rail spending with SMEs exceeds £2.5bn for first time

Our spending with small to medium-sized enterprises (SMEs) has exceeded £2.5bn in a single financial year for the first time.

It comes as the impact of the pandemic has made supporting Britain’s smaller companies more important than ever.

We spent £2.52bn with SMEs in the 2019 to 2020 financial year. The figure represents 35.6% of our total £7.1bn expenditure for that period – more than the Government’s 33% target by 2022.

Britain’s railway is critical to the country’s success as it supports and sustains economic growth – and recovery. The railway connects workers to jobs, businesses to markets, and people to their families and friends.

It also carries goods worth more than £30bn a year, bringing food to shops, building materials to construction sites, and fuel to power stations.

Rail freight is crucial to Britain’s economy

Chris Heaton-Harris, Rail Minister, said: “More than ever it is vitally important that we support smaller businesses right across the country.

“Our railways have long been the lifeblood of this country and supporting thousands of smaller businesses only adds to that.”Clive Berrington, commercial and procurement director at Network Rail, said: “We have focused a lot in the past two years to ensure Network Rail is more accessible to the SME market.

“We now work directly with over 3,000 SMEs, ranging from technology companies that design innovative solutions to keep the railway running safely to catering companies that replenish our teams working through the night.

“Since establishing our SME action plan in 2019, we have also launched several initiatives to make Network Rail ‘easier to do business with’ and these results demonstrate we are on the right track.

“We have developed initiatives to make us more dependable and easier to work with by working smarter with our supply chain and involving them earlier in the planning phase to help us deliver work more efficiently. These initiatives include improved contracting strategies.”

Rise in SMEs working directly with Network Rail

The number of suppliers contracted directly by Network Rail stood at 4,246 in the 2019 to 2020 financial year. Of these, 3,051 (71.9%) were SMEs – a rise of 440 compared with 2017 to 2018.

Our direct spend with SMEs increased by from 12.8% in 2017 to 2018 to 17.8% in the most recent financial year.

Details of Network Rail’s procurement pipeline is updated every four weeks and is available to view here.

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