The fourth government visitor in six months arrived in Wetherby today (December 8, 2015), speaking to a technology business based in the town about the growing national importance of this industry.
Francis Maude, Minister for the Cabinet Office, Paymaster General, and MP for Horsham followed in the footsteps of Prime Minister David Cameron, Chancellor of the Exchequer George Osborne, and Minister for Schools and Families Nick Gibb this morning when he arrived in Wetherby.
Visiting Proactis - a technology business that has headquarters on Wetherby’s Castle Gate - the minister spoke about the growth of digital business in the UK and in central government through the use of an online marketplace called G-Cloud, where suppliers can offer their services to the public sector.
This expansion, he said, is beneficial not only for saving the government money, but also for helping small and medium enterprises (SMEs) all over the country including Proactis, which has won a contract with a housing association in Wales through G-Cloud.
Mr Maude said: “Frankly some of the things in procurement were almost designed to exclude SMEs. They effectively said we don’t want small or new businesses, we have the big ones that we know but will probably cost much more, but we are turning that around.
“Over half of the spend that has gone through the Cloud is to SMEs and we think the savings the taxpayer is getting by procuring through the G-Cloud is 50 per cent, and in some cases much more than 50 per cent, and it is changing the way things get done.
“Last year we saved £14.3bn just in cutting out waste and this year we will save £20bn. We think there is another £15bn to £20bn annually we can do over the next Parliament, which is worth having. That is money that is otherwise wasted and that is important for the economy.
“We are giving more contracts to smaller, UK-based companies, which is great for jobs, and companies like Proactis give us better value.”
Though this innovation in business procurement will benefit companies like Proactis, the technology industry is already booming.
Formed in 1996, Proactis is based in the UK but with links to more than 90 countries.
With over 500 clients and about 2m active users of their solutions, it is continually expanding in line with demand for new technology.
In 2014, it doubled its employee head count from 60 to 135, 60 of which are Wetherby-based, and its share price quadrupled, contrary to negative predictions for British businesses.
Director of public sector Adrian Gibson explained how the company works: “The core of our business is essentially saying to businesses that they should buy online, and as consumers that is what we have all got used to doing. The business environment is somewhat behind the consumer in that.
“It is not necessarily about which solution people use, it is that they should be using something. We think we are the best, but there are others out there.”
Marketing director Simon Dadswell added: “You need somebody there who is responsible and charged with ensuring this is part of the life blood of the organisation.
“It is the back office efficiencies that are still lagging behind and technology can make some big inroads with that.
“In most businesses there are two large costs - pay roll costs and external spend. We help manage all external spend by improving the process to reduce the back office in efficiencies and streamline contact with buyers.”
Proactis’ local clients include West Yorkshire Police, Leeds Metropolitan University, Yorkshire Passenger Transport, the Medical Protection Society in Leeds, and A4E in Sheffield.
Branching out, its services are also used by the RSPCA and NSPCC, 20 of 22 Welsh local authorities, Trident, the teachers’ union NASUWT, Surefix, BT, Clarins, and the government of Barbados.
With recent acquisitions, Proactis has offices in Boston and Phoenix in the USA, and in locations in London, Holland, and Australia, and as an approved supplier on G-Cloud, the company will now be able to bid for contracts within the British public sector much more easily.
Government recognition of this important aspect of doing business in the future, and a pledge to change the way it operates itself as an organisation, is key to continued economic success for all businesses.
Mr Dadswell said: “We have in total 200 public sector clients using some or all of our solutions and they are managing approximately £15bn spend and about 150,000 suppliers are transacting with our technology.
“This visit means government recognition. The public sector represents a huge percentage of our client base, probably close to 50 per cent, and it is very important to us, even just internally to staff, that we are being recognised and that this representative is coming to speak with us.”
And, leaving Proactis with a promise to ‘plug’ the business into central government, Mr Maude expects SMEs throughout the UK to benefit as more and more people become increasingly confident with the Cloud and what it means.
He said: “The Cloud is the future with massive savings, functionality, speed, and everything and there is a sort of gradually expanding comfort zone and we can’t push it beyond public tolerance.
“But they understand it is growing all the time - we all do stuff every day where our personal stuff is in the Cloud and we don’t know where it is going but we all have a high amount of trust that it is being looked after.
“We also know the amount of business the government gives to SMEs is growing all the time and we have opened up for smaller businesses to have a part of our long term economic plan. Growing enterprises are where the future growth lies.
“What is interesting is that this is certainly not centred in London. In Leeds there is a cluster of tech businesses focused around data particularly and I find all around the country businesses like Proactis that are world leading.
“Here is a company doing business in 90 different countries, and that is fantastic. That is experience, that is jobs, that is growth for Yorkshire and for Britain.
“Technology is going to form a big part of the future economy. It is saving money and contributing to getting rid of the deficit which has been halved.”