The UK spends more than the rest of the EU combined on pricey procurement contracts

 
Rebecca Smith
The TPA said outsourcing giants continue to dominate public procurement
The TPA said outsourcing giants continue to dominate public procurement (Source: Getty)

The UK spends nearly double the rest of the European Union combined on large procurement contracts, the TaxPayers' Alliance (TPA) said today.

The UK published 167 contract award notices on contracts worth €100m or above in 2015, despite the government's ambition to get more small and medium-sized businesses to win public contracts, according to a new report from the TPA.

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The report noted that its findings did not necessarily mean that none of the €100m contracts were held by small and medium-sized firms, but did suggest that "the UK is in dire need to start partitioning contracts if it is serious about making it easier for SMEs [small and medium sized enterprises] to engage".

The UK awarded more contracts of €100m or over than any other EU country, and almost six times the number published by the next highest country France, on 29.

Comparatively, Italy published 25, the Netherlands had 14, Spain had 10, and Germany just five. The EU total was 322, so over half of the contracts came from the UK. In terms of total procurement spend, the UK spent £74bn on procurement through contracts of €100m or above, making it 64 per cent of the EU's total.

The TPA said this has left the UK over reliant on outsourcing to very large firms like Capita, Atos, G4S and Serco.


(Source: TaxPayers' Alliance)

Jan Zeber, policy analyst at the TPA and author of the report, said:

From staplers to warships, public procurement regularly accounts for approximately a third of total public spending. It is therefore crucial that value for taxpayers is at the heart of all public-sector purchasing decisions, no matter whether it's a multi-million-pound military vessel or stationery for the Cabinet Office.

The report added: "Enabling small and medium-sized firms to engage is one thing, but if it is to be a truly free market, performance monitoring is just as important, and if a solution is not working, mechanism for addressing it are needed."

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