Policy paper: Cabinet Office and HM Treasury small and medium-sized enterprise (SME) action plan: 2025 to 2028

Its significance lies in supplier-side economics. Cabinet Office and HMT are signalling easier entry to public sector contracts, reduced bidding burdens and lower cost-to-serve for smaller suppliers across the 2025-2028 period. For compliance and procurement teams, the practical consequences are threefold.

First, payment practice moves up the agenda: firms acting as prime contractors or subcontracting into public programmes should expect scrutiny of payment terms, subcontractor transparency and prompt payment behaviour, consistent with existing Prompt Payment Code and Procurement Act expectations. Second, supplier due diligence and onboarding frameworks should be reviewed so that smaller, innovative suppliers (including RegTech, fintech and specialist advisory firms) can pass assurance without disproportionate evidence demands. Third, firms that are themselves SMEs should reassess whether public sector workstreams — including central government, NHS and local authority contracts — are now viable revenue lines, and check registration on relevant procurement portals and certifications.

Action needed: confirm current payment performance against 30-day standards, map subcontracting disclosure obligations, and brief bid teams on simplified routes to market. No immediate regulatory filing or notification obligation arises.