The Competition and Markets Authority is calling for stronger use of procurement data to detect bid rigging across a UK public purchasing market worth around £400bn a year.
Two policy papers published by the regulator argue that government procurement should be used more deliberately as an economic and competition tool, while warning that collusion between suppliers can inflate costs, weaken innovation, and distort access to public contracts.
The CMA estimates that bid rigging could be costing taxpayers at least £1bn annually under a conservative assumption that only 2% of procurement is affected. Using a higher but still conservative prevalence estimate, it says the potential cost could reach £3.5bn. Research cited by the regulator indicates that collusion can raise procurement prices by 20% or more.
The authority’s central concern is detection. Cartels are designed to remain hidden, and contracting bodies do not necessarily see suspicious behaviour when examining an individual procurement exercise in isolation. Patterns can become clearer only when bidding behaviour is analysed across suppliers, authorities, sectors, and repeated tenders.
The CMA’s paper states: “Public procurement only delivers value for money if competition is genuine.” It wants better retention and use of bidding data, including information about unsuccessful bids, to allow analytical systems to identify patterns that could warrant investigation.
The policy direction follows a broader government effort to use purchasing power to support domestic innovation and growth. A £100m AI procurement programme launched last week, for example, is designed to give technology businesses opportunities to demonstrate systems inside government while retaining intellectual property.
The CMA’s latest work addresses another part of that equation: procurement can support newer businesses only if tender design produces credible competitive pressure. Markets dominated by recurring supplier groups, high barriers to entry, predictable purchasing cycles, and repeated contracts can create conditions in which collusion is easier to sustain.
Construction is an obvious area of exposure because large public projects frequently involve recurring suppliers and subcontracting networks, but the regulator’s work also reaches cloud services, defence, civil engineering, and other strategically important markets. Procurement decisions in those sectors affect public spending and determine which companies gain references, scale, investment capacity, and long-term market positions.
Tougher detection could consequently extend beyond enforcement cases. Companies competing for public work may face greater scrutiny of bidding behaviour, subcontracting relationships, pricing patterns, and communications, while contracting authorities may need to retain more detailed data and develop stronger analytical capabilities.
The regulator notes that companies involved in competition-law breaches can face fines of up to 10% of annual global turnover. Directors can be disqualified, businesses can be excluded from public contracts, and serious criminal cartel offences can result in imprisonment or unlimited fines.
The CMA has completed seven bid-rigging cases since 2014, imposing more than £129m of fines on 31 companies. More than half involved public procurement. Conventional enforcement remains inherently limited because only a fraction of cartels are discovered through whistleblowers, leniency applications, or complaints.
Other competition authorities have increasingly turned to automated screening. The UK now has a central digital procurement platform under the Procurement Act regime, but the CMA notes that available public data does not include losing bids — information that can be important when examining whether competitors repeatedly submit intentionally weak offers or avoid particular contracts.
A more data-intensive regime would require investment by government as well as changes by suppliers. Procurement information would need to be sufficiently standardised to compare tenders, company identifiers would need to be reliable, and investigators would have to distinguish genuine commercial patterns from potentially collusive behaviour.
The £400bn public purchasing market is large enough that comparatively small improvements in competition can translate into substantial cash savings. It is also increasingly being used to support industrial strategy, technology adoption, supply chain resilience, and scale-up growth. The CMA’s proposals put stronger competition controls alongside those objectives rather than treating procurement solely as an administrative purchasing process.
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