The short version? DfE wants 10% of its direct procurement spend to go to SMEs by 2028.
Government documents have a reputation. Long, dry, and best read with a strong cup of tea. So when the Department for Education (DfE) published its small and medium-sized enterprise (SME) action plan for 2025 to 2028 on 30 September 2026, you could be forgiven for scrolling straight past it.
Please don't. Buried in there is a very useful map for any small business that fancies a slice of education spending in England. We read it so you can skip the tea and get straight to the good bits.
The short version? DfE wants 10% of its direct procurement spend to go to SMEs by 2028. In 2025 to 2026 it reported 12.3%. So it has already beaten its own homework target, which is a nice problem to have. The more interesting question is where that money actually goes, and how you get a share of it.
Why Every Department Has One of These Plans
DfE is not doing this out of the goodness of its heart. It is part of a bigger push. The government's Backing your business strategy promises to make SMEs a national priority and give them a fair shot at public contracts. Every department has to set a target for direct spend with SMEs and report on it each year. The rulebook for that is Procurement Policy Note 001, published by the Cabinet Office in February 2025.
Then there is the Procurement Act 2023, which came into force on 24 February 2025. Think of it as the big tidy-up of public buying rules. It aims to make things simpler and more transparent, and it brought in pipeline notices, which give small businesses a heads up about future work before it lands.
Want the wider backstory? Our guide to departmental SME procurement targets has you covered, and we also unpacked a similar plan in our UKHSA action plan article.
The Numbers, Without the Headache
Direct spend: 12.3% and counting
In 2025 to 2026, 12.3% of DfE's total procurement spend went directly to SMEs. That works out at roughly £333 million out of about £2.72 billion.
Now, a small plot twist. If you look at DfE's older published numbers, the same year shows 27.2% (£203 million out of £748 million). Did DfE suddenly get worse at working with small firms? No. The measure just got wider. It now includes Education Estates spend plus the procurement spend of DfE's executive agencies and non-departmental public bodies. Bigger pot, smaller percentage. The plan is also upfront that some earlier years were partly indicative estimates while the method was being sorted out. Credit where it is due for saying so.
Grants: another way the money flows
Not all of it comes through contracts. Using government grants statistics for 2024 to 2025 and its own SME register, DfE says it provided over £272 million to SMEs through general grants. That is 11.9% of about £2.3 billion in total general grant spend. DfE calls this a conservative estimate, so the real number could be a bit higher.
Contracts actually won
Here is where it gets real. In 2025 to 2026, SMEs were awarded 88 new DfE contracts worth a combined £57,383,262. The Get help buying for schools service did nicely too. SMEs won 20 of its 38 contracts, which is around 53% by number and about £28.5 million in value. That is 34% of the roughly £83.9 million awarded. More small wins than big ones by headcount, and a healthy chunk by value.
The Secret Door: Supply Chains
Here is something plenty of small business owners miss. A lot of public money reaches SMEs the back way, through bigger suppliers.
Take the school building. The Schools rebuilding programme and the Free schools building programme spend almost £2 billion a year. According to the plan, 82% of that contract value goes indirectly to SMEs through Tier 1 supply chains. DfE has also awarded a new construction framework called CF25. Five of its suppliers are SMEs, it is expected to deliver up to £15.4 billion of projects over its life, and the Tier 1 suppliers have a target of up to 90% of contract value going indirectly to SMEs.
Translation for small firms: if the front door feels crowded, try the side entrance. The plan itself suggests looking at contracts already awarded to larger suppliers and approaching them with an offer to work together. A friendly email to a Tier 1 could be the best sales call you make this year.
So, What Is DfE Promising to Do?
The plan sets out three areas of work for 2025 to 2028. Here is the plain English version:
- Better awareness. More training for DfE staff, more market engagement, and a survey sent to SMEs that showed interest in a tender but did not bid. Basically, DfE wants to ask "why did you ghost us?" and actually listen to the answer.
- Better data. Cleaner supplier records, especially on who counts as an SME, plus more SME reporting from DfE's agencies and public bodies.
- Easier bidding. Ongoing reviews of tender documents to cut the paperwork, and pipeline notices extended to procurements below £2 million.
That last one deserves a moment. Today, pipeline notices (UK1) are published on Find a Tender for intended requirements over £2 million. DfE says its pipeline looks 18 months ahead and is reviewed every 6 months. Dropping the threshold below £2 million would shine a light on many more of the smaller contracts that suit small businesses best.
Your October Diary Just Got Busier
Right, the time sensitive bit. The plan lists three market engagement events for contracts DfE has marked as suitable for SMEs. All three are pencilled in for October 2026, which is, well, now:
- School Transport: estimated value £200 to £300 million
- Books: value to be confirmed
- Mandarin Excellence Programme: up to £2.4 million
DfE says confirmed dates will be advertised on Find a Tender, so keep your eyes peeled. These events are where buyers explain what they want before a tender goes live. Turning up early is a bit like getting the exam questions a few weeks ahead, except completely above board. A £200 to £300 million contract might sound like a lot for one small business, but big contracts need plenty of businesses around them, and that is where supply chain chats start.
What Real SME Suppliers Told DfE
In May 2026, DfE took part in a cross-government supplier event and invited two SME suppliers with current contracts to share what working with the government is really like. Their feedback reads like a free bid checklist:
- Early and meaningful market engagement builds confidence and helps you prepare.
- Clear requirements and open communication matter a lot when you have a small team and limited bid resources.
- Strong contract management and good relationships make delivery smoother and help long-term work.
- Buyers should make use of supplier expertise, because it can lead to better outcomes and fresh ideas.
- Social value is a big driver, and often what sets an SME apart.
- Consistent contacts and policy direction help firms delivering long programmes.
The plan also shares a neat little case study. DfE wanted a pilot price comparison tool for classroom supplies, aimed at 200 schools. It ran a short quotation process, kept things proportionate to the size and risk of the work, and an SME won a 12-month contract worth £98,000. No mountain of paperwork, no giant-only club. Proof that a sensible process lets smaller suppliers play on the same pitch.
Getting Paid: The Unglamorous Hero of Small Business
Cash flow is the thing that keeps small business owners up at night, so let us talk about payment. DfE reports that 97% of its invoices were paid within 30 days between October 2025 and March 2026. The public sector is required to pay suppliers within 30 days, and those terms are meant to flow down public sector supply chains too. You can read the detail in the government's prompt payment policy.
The wider picture is shifting as well. The government has said it will legislate to strengthen maximum payment terms to 60 days between UK businesses, make late payment interest mandatory and give the Small Business Commissioner stronger powers, as set out in the Backing your business policy annex. A late payments Bill was introduced in Parliament in May 2026 and is still making its way through, so treat the details as proposals until it becomes law.
Your Homework (It Is Not Too Painful)
Ready to turn all this into action? Here is a simple plan:
- Set up alerts for DfE notices. Search supplierverse for Education UK1 pipeline notices and watch for market engagement events.
- Register for the October events. Even if School Transport is too big for you alone, the supply chain around a £200 to £300 million contract can be a real opening.
- Think about teaming up. The government has guidance on how to bid for government contracts as a consortium and on bidding as an SME effectively.
- Slide into a Tier 1 supplier's inbox. Check who holds the big education and construction frameworks and offer your specific skills.
- Polish your social value evidence. Our guide to scoring social value can help you show it off properly.
- Look at frameworks and dynamic purchasing systems. They put you in front of buyers who are already shopping. The Government Commercial Agency lists upcoming agreements, and our DPS guide for SMEs explains how mini-competitions work.
Here is the honest truth. For most small business owners, the hard part is not writing the bid. It is finding the right notice at the right time, among thousands of others. That is exactly the problem Supplierverse is built to help with, by helping SMEs spot public sector opportunities that suit what they actually do. And if the legal side makes your eyes glaze over, our Procurement Act 2023 guide for SMBs keeps it friendly.
The Bottom Line
Is a 10% target that DfE has already passed a low bar? Fair question, and the number alone does not tell the whole story. The Minister's foreword says forward-looking opportunities are being explored, including joined-up work across departments, which could mean more in the years ahead. For small businesses, the real signals are the pipeline notices, the supply chain targets and the promise to make tenders easier to read and respond to.
None of this is a guarantee of contracts. It is a public commitment, with numbers attached, that DfE will be measured against every year. And for UK SMEs, that is a very good reason to start paying attention to education procurement. Class is in session. Grab a seat near the front.
This plan applies to England. Figures are taken from DfE's published action plan and were checked against GOV.UK sources in October 2026.