The Competition and Markets Authority (CMA) in the UK is actively engaging in innovative measures to combat bid-rigging in public procurement—a sector constituting a significant portion of national spending, valued at approximately £329 billion in 2021-22. Sarah Cardell, the head of the CMA, has highlighted the introduction of a trial programme that harnesses artificial intelligence to analyse large volumes of bidding data, aiming to identify suspicious patterns suggestive of collusion among contractors.
Cardell described the programme as part of the agency's broader objective to reduce fraud and inefficiencies within the country's public procurement landscape, which is estimated to be worth £300 billion annually. In an interview with the Financial Times, she noted, “We know that procurement markets are at significant risk of bid-rigging. We’ve now got the capability to be able to scan data at scale, bidding data at scale, to spot anomalies in that bidding data, and to identify areas of potential anti-competitive conduct.”
The pilot programme has been initiated with one government department and has reportedly shown promising results so far. This comes in the wake of the CMA initiating a bid-rigging investigation linked to the Department for Education’s school improvement fund. The agency suspects that multiple firms involved in roofing and construction might have colluded to secure contracts dishonestly, reflecting a serious concern over integrity in government contracting.
In a significant past incident, the CMA imposed fines totalling nearly £60 million on ten construction firms in 2023 for similar activities related to demolition and asbestos removal contracts. The ongoing scrutiny of public procurement processes has been amplified by questionable deals made during the Covid-19 pandemic, which raised alarms about transparency and conflicts of interest between officials and suppliers.
As a further measure to deter misconduct, a new debarment regime is expected to be implemented in early 2024, which would impose bans on companies from participating in public contract tenders if found to have infringed competitive laws. Cardell remarked on the potential impact of the AI-driven programme, stating, “We think it’s got a real potential to drive billions of savings for the public purse, but also obviously enhancing public sector productivity, which is a core component back into the [CMA’s] growth mission.”
The CMA's prioritisation of growth stems from directives set by the previous government, although its performance has faced scrutiny from the current opposition led by Sir Keir Starmer. In October, British Prime Minister Rishi Sunak, during a conference with global business leaders, reiterated his desire for regulatory bodies to adopt a serious outlook towards fostering economic growth.
Cardell has assured that the CMA remains steadfast in its commitments, asserting that the strategic priorities outlined two years ago focused on supporting productive and sustainable economic growth across the UK. Furthermore, the CMA is scheduled to reassess its approach to "behavioural remedies" in merger assessments by 2025, moving towards alternative measures, such as price freezes, to ensure consumer protection without necessitating business divestitures.
Source: Noah Wire Services