Barriers stopping small businesses from contracting with the federal government will be unearthed in a new inquiry.
The probe, referred by Finance Minister Katy Gallagher to the small business ombudsman, will determine if reforms introduced last year aimed at levelling the playing field for smaller operators are working or not.
Changes to Commonwealth procurement rules, which guide the contracting of goods and services from the private sector in the interests of the taxpayer, were introduced last year with the intention of boosting participation of small businesses.
The Australian Small Business and Family Enterprise Ombudsman Bruce Billson said the government was committed to becoming a bigger customer of small businesses.
But the process of dealing with Commonwealth procurement was still complex, costly, confusing and time-consuming.
"We want to look at what support is given to small businesses to navigate what can be a complicated procurement process," he said.
"In some cases, small businesses are deterred by a feeling there is a 'closed shop' while in other cases they simply don't know about the opportunities available, or the size of the contract can be simply too big."
Of the $80.8 billion in contracts awarded to businesses in 2021/22, less than a third were awarded to small and medium-sized enterprises.
Mr Billson said it was important to level the playing field for small and family businesses to ensure government agencies are getting the most value for money.
"Where there are procurement impediments, it can diminish opportunities to encourage entrepreneurship and competition and means the taxpayer and the nation may not be getting the most value for money."
