CMA urges UK to use public procurement more strategically and tighten bid-rigging controls

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CMA urges procurement strategy

Highlights

Competition and Markets Authority urges UK to reform public procurement strategy for stronger competition, innovation, and SME participation, citing insufficient current impact despite massive procurement scale.
CMA estimates bid rigging may be inflating UK public procurement costs by 20%, with taxpayer overpayments between £1 billion and £3.5 billion yearly and negative effects on quality and innovation.
CMA launches BRIT data tool to detect supplier collusion, calls for prioritizing bid-rigging prevention in the National Procurement Policy Statement, and emphasizes need for machine-readable, large-scale procurement data.

Procurement strategy and policy recommendations

As set out in remarks published on GOV.UK by the Competition and Markets Authority, chief executive Sarah Cardell says the regulator is releasing two reports on how procurement can better support industrial strategy and competition. The first report, "Public Procurement in the National Interest," concludes that the UK is not yet using procurement as effectively as it could despite its scale and influence over business growth, investment flows and technology adoption.

Cardell says procurement is now expected to deliver a broader set of objectives, including value for money, innovation, growth, resilience, national security, domestic jobs and social value. She says those aims require clearer prioritisation and explicit trade-offs, because focusing only on short-term cost or established suppliers can weaken competition and make it harder for innovative British firms to scale.

The CMA identifies five main shifts it wants government to make, including moving from process to outcomes, from fragmentation to coordination, and from assumptions to evidence through better data. It also calls for procurement rules to be reviewed for the burden they place on bidders, particularly SMEs and scale-ups, and for a more experimental framework that helps create future markets and technologies rather than only purchasing existing solutions.

The speech also argues that fragmented purchasing across the public sector weakens the government's leverage with suppliers and reduces incentives for investment in skills, capacity and innovation. Cardell says stronger coordination, shared expertise and better market intelligence would allow public buyers to shape markets more effectively without centralising every procurement decision.

Bid-rigging risks and taxpayer costs

The CMA's second report, "Rigged Bids, Real Costs," focuses on supplier collusion during procurement processes and the financial damage it can cause. Cardell says the authority has completed seven bid-rigging cases since 2014 and imposed more than £129 million in fines, with more than half of those cases involving public procurement.

Drawing on OECD research, the CMA says bid rigging can raise procurement prices by 20% or more. Using what it describes as conservative assumptions, the regulator estimates taxpayers could be overpaying by between £1 billion and £3.5 billion each year, adding pressure to already stretched departmental budgets.

The speech says the impact extends beyond cost, citing evidence that collusion can also reduce quality and innovation. It highlights growing use of data analytics and AI by competition authorities in countries including Spain, Portugal, Brazil and Korea to detect suspicious bidding patterns at scale.

Cardell says the CMA has developed a Bid Rigging Intelligence Tool, or BRIT, and is piloting it with government departments. She adds that the tool's wider effectiveness depends on access to large-scale, machine-readable procurement data, including losing bids, and calls for bid-rigging prevention and detection to become an explicit priority in the new National Procurement Policy Statement.

The CMA’s push for wider access to government procurement data has focused on scaling its screening approach to spot potential bid rigging across public contracts, including discussions around defence supply chains. Our earlier article noted that pilots with several departments were already generating enforcement leads, but that a stronger cross-government commitment and more centralised, machine-readable tender data (including losing bids) would be needed to deploy the capability at scale and reduce taxpayer losses.

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