The UK government continues to push the integration of AI adoption into public services, with small and medium-sized enterprises (SMEs) playing an important role in this transition
A recent report from the Department of Science, Innovation and Technology (DSIT) commissioned by Secretary of State Peter Kyle, showed the importance of AI in driving economic growth, creating jobs, and enhancing public services.
SMEs are expected to be key enablers of this vision, providing innovative, personalised AI solutions to government departments and local authorities.
AI adoption in the public sector
AI offers numerous benefits for the public sector, like cutting administrative costs, accelerating processes, and improving service delivery.
The government has already tried incorporating AI into various sectors, including education, healthcare, and law enforcement.
For example, AI assists teachers in lesson planning and grading, supports healthcare professionals in diagnostics and medical reporting, and helps police forces identify threats and anomalies in real-time. These applications ease the workload of public sector employees and enhance service efficiency for citizens.
Challenges in integrating AI into public services
Some challenges associated with adopting AI in public services include concerns over data privacy and security, limited technical expertise, and a reluctance to embrace new technologies due to ethical considerations, particularly in handling sensitive citizen data.
This is why SMEs are important, accounting for 99.9% of UK businesses and employing a significant portion of the private sector workforce, SMEs are essential to the UK economy.
These businesses are known for their flexibility, cost-effectiveness, and ability to provide specialised services. In the context of AI, SMEs can offer personalised solutions that address specific needs, helping public sector organizations implement AI in ways that larger corporations might not be able to.
The skill of SMEs allows them to innovate quickly, adapt to changing public sector demands, and deliver solutions on tighter timescales. Their smaller size also means they can manage smaller datasets, which may reduce privacy concerns compared to larger companies. SMEs tend to be more embedded in their local communities, which can help them align AI projects with local needs and create social value.
SMEs and public sector procurement
Barriers SMEs have faced include a lack of awareness among contracting authorities about the capabilities of SMEs, the complexity and bureaucracy of the procurement process, and limited resources to compete with larger firms.
However, recent changes in procurement regulations, notably the Procurement Act 2023, are designed to address these issues by encouraging public sector organisations to remove barriers and make it easier for SMEs to participate.
Crown Commercial Service (CCS) has launched a Dynamic Purchasing System (DPS) specifically focused on AI solutions to support SMEs further.
This system simplifies the procurement process by allowing suppliers to self-certify and join at any point during the life of the agreement. The DPS reduces procurement times significantly, enabling quicker access to AI solutions, and ensures that SMEs have equal opportunities to compete with larger businesses.
Crown Commercial Service role in helping SMEs
CCS’s AI DPS includes a variety of suppliers catering to the needs of public sector organisations across different sectors, including local authorities, healthcare, and charities. The system requires suppliers to meet ethical standards, ensuring that AI technologies are transparent, fair, and secure. This approach helps mitigate risks associated with AI adoption, such as bias and data misuse.
To help SMEs navigate the public sector procurement landscape, CCS is hosting webinars offering insights into the AI DPS, the government’s AI strategy, and successful case studies from SMEs already engaged in public sector AI projects. These webinars will take place in March, April, and May to equip businesses with the knowledge and tools to bid for public sector contracts successfully.
