HP airs concerns over Government SMB IT deals

HP has reportedly written to the Treasury to air concerns about plans to award more Government IT contracts to SMBs.

The tech giant is said to have written to the Treasury to complain about Cabinet Minister Francis Maude's (pictured) push to award more IT contracts to smaller suppliers, according to an article in The Independent earlier this week.

It claims HP is unhappy at Maude's plans to review all IT contracts that cost more than 100 million, because this suggests it is no longer in the firm's interest to compete for Government IT contracts.

At present, HP is understood to make around 1 billion a year from providing computer support to the Department for Work and Pensions and the Ministry of Justice.

In recent years, the Government has made a concerted effort to ensure SMBs win a higher proportion of public sector IT contracts, as it moves away from multi-year, legacy IT contracts with multinational tech firms.

This is exemplified by the championing of relatively new procurement models, such as G-Cloud and the Digital Services Framework.

Speaking at an event earlier this year, Maude claimed the public sector can often get better value for money by working with SMB suppliers.

As an example, he cited the retendering of a hosting contract. The large, incumbent supplier bid 4 million, but the contract was eventually won by an SMB who offered to fulfil it for just 600,000.

In a statement, HP said it has a "proud and long-standing" Government IT supplier. "We maintain an ongoing dialogue with Government about our programme of work."

Meanwhile, a Cabinet Office spokesperson told The Independent that it was "unaware" of HP's letter to the Treasury, before adding: "We value the contribution companies of all sizes make to the UK economy, driving innovation, growth and jobs."