How can Government procurement support innovation and growth?

How can Government procurement drive innovation while still retaining its core values?

07 Mar 2017

Every year, over 80% of Government contracts, which makes up about half of the total annual contract value, are awarded to small and medium enterprises (SMEs). The Government understands that it can do more to drive innovation through their procurement practices, while still retaining its core values of being fair, transparent and bringing value-for-money.

Driving innovation through procurement

The Government will encourage more agencies to use crowdsourcing methods to look for solutions. Crowdsourcing is an ideal way for Government to partner businesses, community and individuals to solve the problems that Singapore faces.

An outcome-based procurement approach will also be encouraged amongst public agencies. Through this approach, public agencies are allowed to specify their desired outcomes and give tenderers the flexibility of proposing their own solutions. This will spark ideation and innovation amongst tenderers.

The Government understands that innovation and experimentation can cause uncertainty in the final result. Public agencies are encouraged to adopt a spiral contracting approach for such a situation. This approach allows an agency to award the project in phases, starting with the more experimental phase. If this phase is successful, subsequent phases of the project can then be awarded to the same vendor.

Granting help to businesses

Government grants and licenses can be crucial to the growth and operations of many businesses and the Government is planning to make these transactions easier.

The Ministry of Finance (MOF) and the Ministry of Trade and Industry (MTI) launched the Business Grants Portal in 2016. The Portal is a one-stop shop for businesses to identify and apply for the right grant for their needs. By the end of 2017, businesses can apply for four more grants, including the Building and Construction Authority’s Mechanisation Credits and NPark’s Landscape Productivity Grant. This is in addition to the six grants that the Portal already offers. MOF will continue to review and streamline the grant application process.

LicenceOne, the one-stop business licensing portal, which has been progressively rolled out since 2014, will be expanded to offer more than 100 licenses by the end of the FY2017. This is an increase from the 80 licences it currently offers.