CBI survey shows companies blame procuring authorities for rising costs and delays

Private firms still think the government is a poor customer in spite of efforts to improve public procurement, the Confederation of British Industry (CBI) has warned.

A survey carried out by the CBI showed three quarters of firms think public sector procurement needs “fundamental change”.

More than two-thirds said taxpayers were getting bad value for money. The public sector spends around £100bn a year on private sector goods and services.

Problems negotiating terms and conditions, failure to address policy issues at the outset and inadequate specifications from the procuring authorities were blamed for rising costs and delays.

Nine out of 10 firms said specifications get changed by government clients during or after procurements and 76% said processes tend to suffer “significant” delays.

More than half of respondents said costs had increased “substantially” over the last five years.

Neil Bentley, CBI director of public services, said: “Public procurement processes are too often characterised by unnecessary delays, high costs and changed specifications.

“The government is beginning to make an effort to fix the problems, but progress is too slow and taxpayers are losing out.

“As we enter a tighter public spending period, buying goods and services competitively from the private sector will become increasingly important in ensuring the public get value for their tax pounds, on everything from paperclips to new hospitals.”

He added that procurement problems and poorly trained public sector staff were discouraging firms from bidding for contracts. “Improving skill levels must remain a key priority for government,” he said.