The DSIT SME action plan sets out how the Department for Science, Innovation and Technology will increase opportunities for small businesses across procurement, grants and innovation programmes between 2025 and 2028.
As the Government places growth at the centre of its agenda, SMEs are positioned as a key driver of economic expansion. Therefore, the plan focuses on making it easier for smaller firms to compete for public contracts and scale through targeted support.
Crucially, DSIT will publish a full updated action plan in Autumn 2026 following the integration of the UK Space Agency and Building Digital UK. In the meantime, the current framework outlines immediate steps to remove barriers and improve access.
DSIT SME Action Plan Expands Access to Contracts
The DSIT SME action plan prioritises fair access to government procurement. Historically, complex bidding processes have limited SME participation. However, the introduction of the Procurement Act 2023 simplifies the system and increases transparency.
As a result, SMEs can compete more effectively for public sector work. In addition, DSIT has committed to setting clear departmental targets for direct SME spend. These targets will be monitored through annual reporting, which ensures accountability and progress tracking.
Furthermore, the department plans to reduce administrative barriers that often discourage smaller firms from applying. Consequently, more start-ups and scale-ups can enter government supply chains.
This approach aligns with wider innovation goals. For example, emerging technology firms across the UK are already scaling internationally, as highlighted in our coverage of CyberQ Group Global Tour Expands International Reach. Together, these initiatives show how policy and enterprise growth are becoming increasingly connected.
Funding, Skills and Local Business Support
Beyond procurement, the DSIT SME action plan supports access to finance and business development. The Government has committed a £4bn funding package to improve access to capital for entrepreneurs. Therefore, more businesses can invest in innovation and expansion.
In parallel, a new Business Growth Service will simplify access to advice and support. Previously, fragmented programmes created confusion. Now, a streamlined digital platform will help SMEs navigate funding, mentoring and scale-up opportunities.
At the same time, the plan includes targeted support for high streets. This includes updated licensing frameworks and place-based funding. As a result, local businesses can establish and grow more easily within their communities.
Importantly, new legislation will also tackle late payments. This reform strengthens cash flow stability, which remains a major challenge for SMEs. Consequently, businesses can operate with greater financial confidence.
Driving Innovation Through SME Participation
The DSIT SME action plan also aims to embed SMEs at the centre of the UK’s innovation ecosystem. By increasing participation in public sector projects, the Government expects to unlock new ideas and accelerate technological development.
Moreover, closer collaboration between SMEs, government and research institutions will support innovation across sectors such as AI, digital infrastructure and advanced manufacturing. Therefore, the plan reinforces the UK’s ambition to remain globally competitive.
Overall, the DSIT SME action plan represents a shift toward a more inclusive and accessible innovation economy. If implemented effectively, it could enable thousands of SMEs to scale, innovate and contribute to long-term national growth.
