Pressure placed on public sector contractors to maintain a high level of performance indicates the high stakes of being a Government supplier.

Francis Maude, the Cabinet Office minister, will warn IT suppliers today that spending controls will be a "permanent way of life" and that poorly performing companies will find it difficult to win new government contracts.

In a move to streamline the public sector, Cabinet Office Minister Francis Maude announced the meeting with the top 22 public sector suppliers to outline the new drive to streamline and record the contractor’s performance. Those that fail to hit the required level of performance will be banned from supplying to the Government.

According to Andrew Gilbert, Managing Director at data centre and communications company Node4, the Government still needs to focus its efforts on delivering a cost effective service that continues to address the growing number of security concerns.

He said, “The government needs to embrace the fact that there are many high quality suppliers out there who have the ability to provide services which are a far better value for money proposition for tax payers. The Government needs to diversify its supply chain and consider companies who have strong proven track records and operate from a much more competitive cost base.”

Andrew continued, “In these austere times, small and medium sized enterprises have greater agility to deliver specialist services such as cloud computing, at more flexible price points without dangerous compromises that could leave highly sensitive data exposed to exploitation.”