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The UK government faces a “significant risk of bid rigging” by contractors, the head of the UK competition regulator has warned.
Sarah Cardell, head of the Competition and Markets Authority, said the authority was testing a new AI-powered tool that it believes could help catch companies that collude when bidding for public contracts.
The pilot, which uses artificial intelligence to collect wide-ranging data, is part of an attempt to reduce fraud and waste in the UK's £300bn-a-year public procurement market.
“We know that procurement markets are at high risk of bid rigging,” Cardell told the Financial Times. “We now have the ability to be able to scan data at scale, bidding data at scale, to detect anomalies in that bidding data, and identify areas of potential anti-competitive behavior.”
She said that the pilot program with a government department “proved to be very successful.”
The Capital Markets Authority announced last month New investigation into bid rigging Due to suspicious activity regarding the Ministry of Education's School Improvement Fund.
The agency said it had reason to suspect that several companies providing roofing and building services colluded to rig bids to obtain contracts through the fund, which is used to protect educational buildings.
In 2023, the Capital Markets Authority 10 construction companies fined nearly £60 million To rig bids to win demolition and asbestos removal contracts.
Public procurement has come under intense scrutiny in the UK in recent years after a number of contracts awarded in relation to the Covid-19 pandemic raised questions about a lack of transparency and conflicts of interest between suppliers and politicians. Procurement represents about a third of public spending Which totaled £329 billion in 2021-22.
New blocking system It is scheduled to take effect early This year will mean that companies will face a ban from bidding on public contracts if they are found to have breached competition law.
“We believe (the program) has real potential to drive billions in savings to the public treasury, but it also clearly enhances public sector productivity, which is a key component of (the agency’s) growth mission,” Cardell said.
The agency was given a specific mandate to set growth priorities by the last government, but has faced criticism from Sir Keir Starmer's administration over its delivery of the measure.
The Prime Minister told a crowd of global business leaders in October that he wanted to “make sure that every regulator in this country, particularly our economic and competition regulators, takes growth as seriously as this chamber does.”
Cardell also defended the CMA's record, saying its strategic direction set two years ago “made clear that supporting productive and sustainable growth across the entire UK economy was a priority for the CMA”.
Sergeant is It is also preparing to review its use of “behavioral therapies.” In merger provisions in 2025. Instead of forcing companies to divest, these remedies use other measures — such as price freezes — to protect consumers.
