Queensland pledges to spend $300 million more on SME procurement

A peak body representing Australian retailers has welcomed a commitment by the Queensland government to source more goods and services from small and medium-sized businesses. 

Under the Buy Queensland initiative, the Queensland government had previously committed to an SME procurement target of 25%. On Saturday, it announced this target will be lifted to 30%. 

The change will equate to an extra $300 million in spending going to the sector, the government says. 

Buy Queensland has operated since 2017. Since that time, Queensland Small Business Minister Di Farmer says the state government has “invested” more than $75.5 billion with close to 80,000 SMEs.

“The best part is that $8.83 billion has gone to Queensland regional businesses — more than 28,670 of them in that time,” she said in a statement. 

“These figures are a great start, particularly during such challenging times, but there’s more we can do,” she added. 

The National Retail Association, which says it represents more than 60,000 retail stores across the country, says the change will give the state’s SMEs a much-needed boost. 

“SMEs are finding it difficult to compete with their larger contenders and it’s beginning to erode business confidence,” said National Retail Association CEO Dominique Lamb. 

Lamb says current trading conditions are causing small businesses to “shrink into the background” when in fact they are an “integral part of the Queensland economy”. 

“Taking Buy Queensland to the next level evens out the playing field and gives these businesses the opportunity to grow despite the factors working against them,” she added. 

The new target was also welcomed by the Chamber of Commerce and Industry Queensland, with CEO Heidi Cooper saying the change “could not have come at a better time for Queensland businesses as they prepare for opportunities for long-term growth, diversification and resilience”. 

Improving SME procurement has also received recent attention at the federal level, with the newly-elected Albanese government revising the Commonwealth Procurement Rules (CPR) on July 1 this year. 

Under the new rules, at least 20% of federal government contracts, by value, will be awarded to SMEs, up from a previous target of 10%. 

In 2020-21 the Commonwealth spent $69.8 billion on contracts, with $18.7 billion, or 27% by value, going to SMEs.