Although competition is an underlying principle of public procurement, (and widely acknowledged to be a key enabler of value for money) the NAO found that many UK Government departments routinely extended contracts rather than retendering them.
The central government department with responsibility for public procurement also failed to show how well competition was working, and could not demonstrate a structure to encourage and support the use of competition in its own public procurement processes.
By engaging all of the market, sharing information (in a way that does not favour particular suppliers) and asking the market for feedback, the NAO believe that UK Government departments can increase levels of competition in future procurements.
The NAO concluded there report with a recommendation that UK Government departments need to consider how their actions during individual procurements can affect the long-term participation of suppliers and consequently the competitiveness of the market.
They argue that in doing so, more smaller firms would stay involved in public procurement processes, while reducing UK Government department reliance on a few large suppliers.
Suppliers told the NAO that high bid costs, lack of confidence in evaluation and a lack of feedback had detered them from bidding on future Government contracts.
Naomi Clews Consultancy
Procurement, Tendering, Business Skills