Competition for public contracts sees rise in disuptes more than double

There has been a sharp increase in the number of complaints by businesses over the way the government hands out public sector contacts according to a new report.

According to a report by commercial law firm McGrigors, the Office of Government Commerce (OGC) saw a 55% rise in the number of disputes in the year ending June 2011 from 47 to 73.

The report noted that the number of disputes had quadrupled since the start of the recession in 2007/08.

The rise in complaints has seen a large number of tenders being amended with 22% of contracts investigated and changed following complaints in the last year. Complaints have increased as competition intensifies due to cut backs in government spending.

McGrigors director Stuart Cairns said : “The recession has meant that public sector contracts are at a premium.

“There are fewer contracts to go round, so disputes over how contracts are awarded have become more frequent and bitterly fought.

“There is a lot at stake. For many bidders the risk of failing to secure a public sector contract can mean the difference between survival and going out of business.”