The number of local authorities adopting different processes for  tenders below EU thresholds has increased from 74% to 83% this year.

A new survey by the Federation of Small Business (FSB) found that 86% of local authorities break contracts into lots in order to support local businesses, with 96% saying they have simplified and standardised their tender process.

The research, 'Local Procurement, making the most of small businesses, one year on', also found that for every £1 spent by local authorities with local firms, an additional 51p is generated for the local economy.

Peter Fleming, chair of the LGA's improvement and innovation board, said: ‘By spending money locally we know that we are helping to pay the wages of local people, giving them money to spend in local shops and helping the whole local economy as a result.

‘Half of all council contracts are now awarded to small and medium-sized businesses compared to just 13% for central government, and we will continue to work with the FSB to seek out and promote best practice from councils who are simplifying procurement practices and finding new ways to help their local small businesses compete.'

While 95% of local authorities surveyed said they have policies in place for the payment of suppliers, only 39% said they ask main contractors to pass on payment terms.