Initiatives of the SME Corporation for procurement from small businesses did not receive support from the Ministry of Finance

The government has returned to discussing support for small and medium-sized businesses through state orders, as follows from the Ministry of Finance’s response to the proposals of the SME Corporation. The curators of small businesses proposed adjusting the mandatory procurement quota for the state and state-owned companies – excluding from it transactions of state-owned joint stock companies with affiliated SMEs, and also introducing a separate quota for purchases from small technology companies. It is also proposed to expand the practice of advance payments to SMEs and increase customer limits for small purchases in the electronic store. The Ministry of Finance did not support all these initiatives, noting that their implementation could worsen the situation of customers and suppliers.

The government is discussing the possibility of additional support for small and medium-sized enterprises (SMEs) through orders from the state and state-owned companies. Let us recall that their guaranteed demand for SME products is considered one of the most effective tools to support this sector. At the end of 2022, the White House recorded a record volume of purchases of state-owned joint stock companies from SMEs – 7 trillion rubles. (after 4.4 trillion rubles in 2021). At a May meeting with First Deputy Prime Minister Andrei Belousov, this growth was explained by the expansion of the list of state-owned companies required to purchase from SMEs (see Kommersant on May 15).

At the same time, tools to support the sector were discussed – now the Ministry of Finance, responsible for regulating public procurement, presented its position on them. The department’s letter dated September 18 (available to Kommersant) is a response to an appeal from the SME Corporation. Now, according to the laws on procurement of the state (44-FZ) and state-owned companies (223-FZ), customers must give at least 25% of the volume of supplies to SMEs – the SME Corporation proposed introducing separate quotas for small technology companies. In response to this, the Ministry of Finance reminded in its letter that preferences for certain areas of activity are not provided for in the procurement legislation, and in general, preferential conditions for participation in tenders of individual suppliers are prohibited by the Law “On the Protection of Competition”.

Another proposal is not to count their transactions with affiliated suppliers in the quota-based purchases of state-owned companies. The Ministry of Finance also does not support this innovation, citing data from the SME Corporation itself about the low share of such purchases – 2.3% of the total volume of contracts. The process of determining affiliation is complicated: information about the ownership of shares in the authorized capital of a legal entity is not subject to mandatory disclosure, the state of affiliation may change, and it is impossible to automate the process.

Among the proposed initiatives is solving problems with advance payments. It should be noted that industry regulators often propose increasing the volume of mandatory advance payments up to 100%, although this possibility is left to the discretion of customers under the public procurement law. The SME Corporation requests that a minimum advance payment to small companies be set at 30% of the contract amount, explaining that customers are reluctant to make such an advance payment. The Ministry of Finance responded by recalling the “high degree of independence” of state-owned companies in procurement and the possible violation of their interests. As a general rule, the source of financing for procurement is not budget funds; under sanctions, innovation will only complicate the activities of customers. Let us recall that the Ministry of Finance, as also responsible for the management of state property, is interested in the development of state joint-stock companies and the growth of their efficiency.

Finally, another initiative of the SME Corporation is aimed at increasing the limits of purchases from SMEs through an electronic store from 20 million rubles. immediately up to 50 million rubles. It is noted that the “electronic store” procedure is simple and will attract more entrepreneurs to this type of procurement. The Ministry of Finance believes that the implementation of this proposal will have the opposite effect: enlarging the contract by 2.5 times means that “one SME will receive support in the form of an order for 50 million rubles. instead of three different ones… for an amount of up to 20 million rubles.”

Diana Galieva