HS2 Ltd, the company overseeing Britain’s largest construction project, claims that its endeavor is not just about infrastructure development but also about bolstering the country’s small business sector. New figures released by HS2 reveal a significant surge in spending with small and medium-sized enterprises (SMEs), indicating a positive impact on the UK’s business community.
Empowering SMEs: The data from HS2 shows a substantial increase in spending with SMEs by its civils contractors in the financial year 2022/23 compared to the previous year. Small businesses, constituting over 70% of HS2’s supply chain, benefited from a noteworthy £942 million, marking a doubling of expenditure from the previous year’s £456 million. This injection of funds has provided a much-needed boost to construction companies across the nation grappling with inflation and supply chain disruptions exacerbated by the pandemic and geopolitical tensions.
Record-Breaking Progress: The momentum of HS2’s construction efforts reached its zenith in 2022/23, with the project hitting peak construction and its workforce surpassing a record 30,000 individuals. Robin Lapish, HS2’s Supply Chain Lead, attributes this success to robust targets set from the project’s inception to ensure the involvement of UK-based SMEs. Lapish underscores the project’s commitment to supporting local businesses and emphasizes the potential for further growth in the coming years.
Promising Prospects: Looking ahead to 2024, HS2 anticipates continued opportunities for SMEs, with a procurement pipeline exceeding £1 billion set to be released by construction partners. Additionally, contracts for railway systems amounting to £5 billion are slated for award. The company aims to encourage more local businesses to participate and reap the benefits of its expansive construction program.
Supplier Diversity and Local Impact: HS2’s construction partners have demonstrated a commitment to supplier diversity, with an average total spend of 20% with SMEs in 2022/23. Notably, Align JV and EKFB JV, responsible for delivering key sections of the HS2 route, exceeded this average, achieving total spends of 33% and 26%, respectively. EKFB JV’s focus on supplier diversity has earned commendation from industry bodies, reflecting its dedication to fostering inclusive procurement practices.
Community-Level Growth: The positive effects of HS2’s investment are not confined to the business realm but are felt at the grassroots level. Local businesses, such as haulage specialist Vaughan Plant Haulage LTD, have experienced tangible growth opportunities. The company’s Managing Director, John Vaughan, attests to the project’s role in stimulating employment and creating new prospects for local enterprises.
