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Hylton reassures SMEs of government contracts

Published:Friday | January 2, 2015 | 1:00 AM
File Anthony Hylton, Minister of Industry, Investment and Commerce

Minister of Industry, Investment and Commerce Anthony Hylton has reassured the small and medium-sized enterprise (SME) sector that the Government will stick to its commitment to ensure that they benefit from 15 per cent of all government contracts.

Speaking at the Small Business Association of Jamaica (SBAJ) annual luncheon recently, Hylton said the 15 per cent set-aside arrangement will form part of the procurement bill now before Parliament and that the ministry is keeping a keen eye on the process to ensure that it is delivered shortly.

"The procurement bill is currently undergoing review by a joint select committee of Parliament. I am keeping a keen eye on developments to ensure that the 15 per cent procurement set-aside is part of the bill that ultimately becomes law in Jamaica," Hylton told the gathering of local business operators, but he did not give a specific timeline for its delivery.

The provision is not unusual in many countries, including developed economies, Hylton said, noting that the incentive package is critical to the growth and survival of entrepreneurship in Jamaica

GOv't stimulus package

The Government, in December 2008, as part of its stimulus package, announced that a system would be put in place that would allow the SME sector to benefit from 15 per cent of all government contracts.

Ministries, departments and agencies were asked to allocate 15 per cent of procurement under its recurrent and capital budget for micro and small businesses.

The maximum value of contracts to be awarded under the programme is $1 million for contracts relating to goods, $5 million for general services, and $10 million for works.

As far back as 2010, in an attempt to kick-start the initiative, the Ministry of Investment, Industry and Commerce and the SBAJ teamed with the Commonwealth Secretariat which lent technical assistance to the implementation of the small-business procurement policy.

The Commonwealth Secretariat, team also said it would help to build a framework to put small businesses in a better position to attract funding from local financial institutions.

Under a two-year project titled 'Assisting Jamaica's industry and commerce competitiveness,' the Commonwealth Secretariat team was expected to deliver a series of capacity-building and innovative mechanisms aimed at fostering the competitiveness of individual enterprises across Jamaica.

The total value of the technical support provided to the SME sector was $25 million and was financed by the Commonwealth Secretariat.

Minister Hylton said the SME sector will not be left without a "slice of the pie" for much longer.

"I believe, as minister, that if we are going to give the SME sector the lift that they need to go through their life cycle and survive, this 15 per cent set-aside is very critical," said Hylton.

President of the SBAJ, Hugh Johnson, also called on the Government to move swiftly to deliver the incentive package.

"The primary objective is to operationalise the 15 per cent compulsory procurement for the SME sector because government is our greatest users of goods and services," Johnson told the Financial Gleaner at the luncheon.

"So, if that 15 per cent set-aside is realised, we will see some regeneration of business in our sector. If there is nothing else we accomplish for 2015, we hope to accomplish that," said Johnson.

"We want the implementation team to get on the ground and get it done," Johnson urged.

tameka.gordon@gleanerjm.com