The Government has announced a contract value limit of £100 million for IT services, with this limit only being lifted in exceptional circumstances.

The limits on contract size was announced by Cabinet Office Minister Francis Maude, and is one of multiple red lines announced in order to increase completion, reduce the dominance of major suppliers and encourage SMEs to bid for more public sector work.

Other new stipulations include limitations on contract lengths, removing automatic extensions and preventing companies from providing services and integration in the same area of government.

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Francis Maude, said: “We are creating a more competitive and open market for technology that opens up opportunity for big and small firms. These red lines will ensure the government gets the best technology at the best price and we will be unashamedly militant about enforcing them to provide value for hard-working taxpayers.”

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