26th February 2026
Yesterday we saw what was wrong – here are suggestions for what could be put right
This is a sequel, of sorts, to the post here yesterday on what is wrong with public procurement.
Here this blog will set out six things that could be done to improve public procurement.
To an extent, this is a mirror of yesterday’s post, but it is still worth setting out something positive against (the usual lot of a law and policy blog) what is negative.
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The first thing would be transparency of commercial terms.
Both the Freedom of Information Act and the Public Procurement Act should be amended so as to remove exemptions from public disclosure of the terms of any awarded public contract.
As this blog stated yesterday, contractors get enough benefit in the amounts of public money and (generally) the reliable revenue stream of public contracts. The price for these benefits should be transparency.
The exceptional circumstances where information needs to be withheld then other exemptions could apply.
Indeed, there should perhaps be a duty for the full contract terms (including commercial terms) to be published between the contract award and the start date.
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The second thing would be transparency of any intention not to advertise and compete a contract.
When – as with the Palantir contracts with the Ministry of Defence – a decision is made by a public authority not to hold a competition or advertise a tender, that decision should itself be published before the decision takes effect.
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The third thing would be to widen the class of those able to challenge a tender decision.
Generally, only disappointed tenderers can challenge a tender decision. As such, it is effectively a private law right for a potential contractor that has suffered damage by a wayward decision.
But: think about the phrase “public procurement” – and ask yourself what difference does or should the word “public” make?
The fundamental reason for public authorities having special duties of transparency and equal treatment and so on in public procurement is that these duties are in the public interest.
Public procurement should not just be about the closed – and indeed often cosy – club of established tenderers and their repeat customers.
Such tenderers have no incentive to upset a past and potential customer by challenging an adverse procurement decision, whatever the circumstances.
Indeed, the law of public procurement is practically geared for there to be very few challenges to procurement decisions.
And a legal regime without practical remedies can hardly be said to be a legal regime at all.
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The fourth thing would be for public authorities to put more resources into practical contract management.
There is little or no point in a contract having a range of provisions to enforce against a supplier if those provisions are never enforced.
It is all very well pointing to a black-letter contract if everyone involved – officials and suppliers – know in reality the public authority will never actually assert its contractual rights.
And contract management is a skilled and important role, not an afterthought – and it is a false economy to not pay contract managers the appropriate rate for the job.
Yet public authorities who will generously budget for payments to a supplier will not make adequate provision for internal contact management.
And those public authorities then wonder why they are done-over by cynical contractors acting in their commercial self-interest.
Related to this: contract management reports should also routinely be published or disclosable on request – for there is as much a public interest in transparency of ongoing contract management as there is in the terms of the contract originally let.
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The fifth thing would be for all potential public contracts a formal stage where a reasoned (and public/published) decision as to whether a COTS (commercially off the shelf) product is available.
Part of the problem with information technology/intellectual property (IT/IP) contracts is a casual and naive view by many in public authorities (though not experienced procurement professionals) that bespoke IT/IP development is somehow preferable and easy to manage.
It ain’t.
And the public authority is then often then captured by the supplier, with their hawked maintenance and support schemes, and with their dependency-culture proprietary products.
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And the sixth thing would be a greater (and more enforceable) emphasis on the principles of public procurement – equal treatment, transparency, competitive tenders, no bias towards incumbents – rather than formal compliance with elaborate statutory codes.
The important thing is that the principles are complied with, not whether a detailed prescribed checklist process (that will only benefit well-resourced tenderers) is followed.
Too often in public procurement, as well in other areas, there is a victory of form over substance.
The problem, for example, with the Covid/PPE contracts was not so much that they did not follow detailed processes, but that the very principles of public procurement were abandoned.
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I can foresee that allowing wider objections to procurement would not end well. The usual suspects will just use this as yet another obstructionist tactic to attack organisation that they object to. Any procurement having vague link to nuclear – get some objection in ? Vague link to Israel – get some objection in?
Reference your fourth point, I suspect there is very little attempt by public bodies to enforce contractual remedies for contractors’ failures to perform.
A few years ago I read of the huge sums being spent by Health Authority Care Commissioning boards with private contractors, and rumours that many were not delivering according to contract provisions. I wrote to my MP (a junior minister) to enquire whether the local health authority had taken any enforcement action against any underperformance by contractors. My MP secured three responses from increasingly senior persons, lastly the Chief Exec, which were not specific, and increasingly evasive. They acknowledged that the contract provisions were available, but repeatedly failed to confirm that the provisions had been enforced. I concluded that weak contract management was allowing private contractors to avoid contractual penalties. Sadly just after the final response, I moved house to a different constituency, and was no longer able to pursue the matter, and the MP concerned quit parliament shortly after, and was unable to carry on.
I can supply details to support this, but it would be inappropriate to make allegations here, so have not ID’ed the authority.
I agree that these problems occur in public procurement specifically in the case of large and complex procurements and/or where the purchaser and supplier end up in a longer term exclusive relationship.
But to some extent it is inevitable. Economic theory tells us that whenever you bind yourself to a contractor that knows more about the situation than you, even if it is just a repairer fixing your washing machine, they can always take advantage of you to a degree. (Laffont & Tirole, A theory of incentives in procurement and regulation, MIT Press 1993)
The best you can do is understand the weakness of your situation and devise arrangements to limit – but not remove – their ability to take advantage. This micro-theory is not like the chicken entrails varieties of economics that bring the discipline into disrepute. Rather it has a powerful and unbeatable logic to it, rather like thermodynamics.
It is important to understand that not all public procurement is like that, and not all public contracts are a money fountain. In particular, when items are limited, one-off and sufficiently well-defined, government is quite good at recruiting competition to keep the cost down. In such sectors, it is generally understood that public sector work is less remunerative than private sector work. But problems still sometimes arise, mainly when government doesn’t quite understand what it wants, or doesn’t understand enough about it to recognise the difference between competent suppliers and charlatans.
I would also not like it thought that specialist public procurers are all highly competent. But I’d better not say any more about that.
I don’t disagree with your comment about a contractor who knows more than you having an advantage, but I see that as identifying a need for better people providing better information client-side. That’s a point DAG covers in his comments about resourcing contract management better.
In the 90s the MoD reduced its headcount as part of the peace dividend and despite the shiny new building at Abbey Wood many experienced engineers retired or left. While there have always been defence procurement disasters they seem to have increased in frequency as current procurement managers dont have the benefit of experience of the old hands. Corporate dementia sets in and you find yourself not knowing what to do.
That’s an excellent list that I can relate to having worked both on public and private sector contracts, and I support your recommendations wholeheartedly.
What I’d be interested in seeing are rebuttals from procurement professionals and elected politicians. My suspicion is that there’ll be no engagement from them on your points, but no energy to change anything.
I find the COTS vs bespoke software debate interesting. Because it’s not as clear-cut as that. Pretty much any serious system is likely to need adaptation or customisation for the specific scenario.
Consider various SAP implementation projects: there’s a huge amount of money made from essentially putting a customer-specific layer on top of the core engine. That might just involve creating menu layouts; more commonly it’s going to need additional “mini-applications” to do workflows. No two production systems are going to be identical. Which might be why I have to go through at least 4 levels of menu in my company’s HR system (built on SAP) before getting to what I consider the most important information.
The engine might be considered the COTS, while the rest of the system (in effect, the pieces the user sees and interacts with) are bespoke. My reading of what went on with Horizon is that one huge mistake was that Fujitsu created their own “transactional engine” (or database + networking) that turned out to be unreliable, whereas there are already proven components that could have been used instead.
Of course, just building on top of a known-quality system doesn’t solve all the problems. Look at Birmingham’s Oracle ERP fiasco. Part of which is likely to be a) continually changing specs and b) trying to automate existing workflows instead of changing to match what’s more natural in the tool.
[Disclaimer – I’ve worked on development of a COTS product/component for many years. It can’t do much on its own; you have to write the business applications to exploit its services. But it does many of the difficult bits – like reliable transactions – so you don’t have to write that yourself.]
I would rate point 5 as the most important. ignoring it has produced most of the public IT procurement disasters of the past decades.
Far too sensible. It’ll never happen.
About:
I did some work in the ‘00s undertaking ‘procurement reviews’ of a couple of Government departments; a good initiative but not very successful.
Current example:
I have two friends who, purely coincidentally, have small firms supplying military buyers with innovative kit. One is to the UK, the other to a EU country. The contrast in their respective experiences, without specifics, is informative. Both suffer the ’small provider’ disadvantage. The small EU country has broken down contracts into a series of short timescales (under 12 months) with simple success criteria (‘it seems to work’). This isn’t perfect but definitely seems to help. Service contracts would need a different approach. The UK seems to impenetrable and unclear, by comparison. Both suffer the added complexity of accountability in a multiple-supplier chain.
How?
Achieving your excellent improvements, particularly in the incentives and penalties for those doing the procuring, might 🙂 meet some resistance. The first step would be to win support near the top of Whitehall, including the Cabinet Office.
Another example:
https://nationalsecuritynews.com/2025/12/the-tragedy-of-ajax-how-on-earth-did-we-get-here/