In its Statistics on Australian Government Procurement Contracts, the Australian Government reveals that it published 92,303 procurement contracts with a combined value of $80.8 billion in 2021-22.
Out of these contracts, $24.9 billion or 30.8% were awarded to small and medium enterprises (SMEs).
The Australian Government has seen a year-on-year rise in SME participation in Commonwealth procurement over a six-year period. In 2016-17, it awarded 34,621 contracts to SMEs, while in 2021-22, this figure had risen by 47.1% to 50,921 contracts.
Through its Commonwealth Procurement Rules, the Australian Government is committed to:
- sourcing at least 10% by value of all procurement from SMEs (this increased to 20% after July 2022)
- sourcing at least 35% of contracts valued up to $20 million from SMEs
Under these rules, an SME is defined as ‘an Australian or New Zealand firm with fewer than 200 full-time equivalent employees’.
Industries gaining the most ground
The Australian Government estimates that 86% of its suppliers in 2021-2022 were SMEs.
It has noted five top SME categories that were awarded the highest estimated value of contracts.
Management and Business Professionals and Administrative Services
SMEs won 51.5% of contracts, worth a total of $16,429.9 million
Engineering and Research and Technology Based Services
SMEs won 59.3% of contracts, worth a total of $8,583.9 million
Building and Construction and Maintenance Services
SMEs won 47.0% of contracts, worth a total of $8,337.2 million
Information Technology Broadcasting and Telecommunications
SMEs won 48.5% of contracts, worth a total of $6,203.6 million
Politics and Civic Affairs Services
SMEs won 55.8% of contracts, worth a total of $5,019.6 million
Almost half of contracts up to $20 million awarded to SMEs
In 2021-22, the Australian Government awarded SMEs an estimated 46.2% of contracts valued up to $20 million, worth a total of $15.5 billion.
Overall, the amount of procurement funding the Australian Government continues to allocate to SMEs is testament to the vital role they play in the Australian economy. A vital role that looks set to grow.
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