Chamber Calls for “Local First” Procurement Approach to Keep Lancashire’s Pounds in Lancashire

New research from the North & Western Lancashire Chamber of Commerce has revealed significant opportunities to increase the amount of public sector spending that remains within Lancashire’s economy, supporting local businesses, jobs and supply chains.

The report, based on Freedom of Information responses from local authorities across Lancashire, highlights substantial variations in the proportion of procurement expenditure retained within local economies and raises important questions about how public sector purchasing decisions can better support local economic growth.

The Chamber’s analysis found that whilst some councils demonstrate strong performance in local procurement, large amounts of public expenditure continue to flow outside both local authority boundaries and Lancashire as a whole. The report argues that public procurement should be viewed not simply as a purchasing function but as one of the most powerful economic development tools available to local authorities.

Among the findings, West Lancashire Borough Council recorded the highest level of spend retained within its own authority area, at approximately 60%. However, the report notes that a significant proportion of this figure related to a single high value contract, highlighting the importance of measuring procurement success not only by the value of spending retained locally but also by the number of local businesses benefiting from public sector contracts.

The report also examines the widely recognised Preston Model, finding that whilst Preston City Council retains a significant proportion of procurement spend within central Lancashire and the county itself, only a relatively small proportion (12%) remains within the city suggesting further opportunities to strengthen links with Preston based businesses.

The Chamber is calling on local authorities and emerging unitary authorities to adopt a stronger “Local First” approach to procurement wherever legally possible and to introduce measures that widen participation amongst Lancashire businesses. Recommendations include setting local procurement targets, publishing standardised procurement data, breaking larger contracts into smaller lots, increasing supplier engagement and improving support for SMEs seeking to access public sector opportunities.

Babs Murphy, Chief Executive of the North & Western Lancashire Chamber of Commerce, said, “Every pound of public money spent has the potential to create jobs, strengthen local supply chains and support economic growth within Lancashire. Our research suggests that whilst there is some excellent practice across the county, too much public expenditure continues to leave local economies.

“This is not about favouring local suppliers over better value alternatives. It is about ensuring Lancashire businesses are given a genuine opportunity to compete for contracts and that the wider economic impact of procurement decisions is properly recognised.

“The success of procurement should not be measured solely by how much money is spent locally. We must also consider how many businesses are benefiting, how many jobs and apprenticeships are being created and how effectively public spending is supporting economic resilience across our communities.”

The report also highlights concerns raised by Chamber members regarding the complexity of procurement processes, with many SMEs believing that contract structures, framework arrangements and administrative requirements can create barriers to participation. The Chamber is urging public bodies to make procurement more accessible, transparent and proportionate to encourage greater involvement from local firms.

With local government reorganisation presenting a once in a generation opportunity to reshape public services, the Chamber believes now is the right time to embed local procurement principles into future procurement strategies across Lancashire.

The report concludes that increasing local procurement spend and broadening supplier participation will help ensure public spending delivers the greatest possible benefit for Lancashire’s businesses, communities and residents.

ENDS

Notes to Editors
• The report is based on Freedom of Information responses received from Lancashire local authorities.
• Data provided by councils varied in format, reporting period and level of detail, and findings should therefore be viewed as indicative of overall trends rather than as a precise comparison between authorities.
• The Chamber’s recommendations include increased transparency, improved SME engagement, wider use of the Lancashire Supplier Charter and greater consideration of local economic impact when evaluating procurement decisions.