Tussell is proud to collaborate with the Institute for Government (IfG), the leading think-tank, and AutogenAI, a British scale-up at the cutting edge, to produce a timely new report on reforming the UK’s £400b per year public procurement market.
The report delves deep into the market landscape, offering practical recommendations to enhance transparency and accountability in this crucial taxpayer-funded sector.
This article provides a snap overview of the analysis included in the report.
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Or, click here to download the full report for free.
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The UK public sector spends over £350b each year on procurement, making up £1 in every £3 of government spending.
Tussell analysis shows that 66% of this procurement spending is by Central Government (with the remaining 34% being split across other verticals such as Local Government and the NHS).
By sector, construction & engineering represents the largest source of procurement expenditure.
Health and social care represents the second largest cost.
Across the public sector, procurement spending with the Strategic Suppliers is falling, whilst the proportion of procurement going to SMEs has remained flat.
The percentage of Local Government procurement spending with SMEs has increased from 24% in 2018 to 30% in 2023.
During that same time period, the percentage of Central Government procurement spending with SMEs fell from 12% to 7%.
According to data from Tussell, in 2023, 86% of public sector procurement spending was with British suppliers. (This represents a slight increase from 84% in 2018). The remaining 14% is spent largely with companies based or owned in France, the US and Germany.
Further analysis into UK public procurement shows that the duration of NHS and Local Government contracts has fallen over time and that the average contract value has decreased.
Central Government contracts are - on average - higher value and are more likely to be awarded via framework agreement or DPS.
Use of frameworks has increased across the whole public sector, but the biggest increase in framework usage has been in the NHS.
Download the full report to take a deeper dive into Tussell's number and the IfG's findings.
The IfG's list of recommendations for reforming public procurement include:
Improving how contract KPIs are monitored;
Reviewing the government's reliance on major suppliers;
Embedding Labour's 'missions' into contract delivery.
You can find a full explanation of the IfG's recommendations by reading the un-redacted report, here.
Public sector procurement is in an era of rapid transition.
Framework usage is sky-rocketing, social value is more important than ever, and the Procurement Act is set to change the way public sector contracting authorities procure goods and services across the country.
For buyers, increasing time pressures and stretching budgets have made access to high-quality procurement data more important than ever.
Dozens of top NHS, Local Government and Central Government procurement teams are already using Tussell to promote social value through procurement, demand better prices from existing suppliers, and make smarter procurement decisions.
Book a demo with the Tussell team to learn how you can save time and money in procurement with Tussell's public sector market intelligence platform.
The era of finding and responding to tenders online is over and the public sector market is increasingly complex.
Framework usage is rising across all public sector verticals and many suppliers are finding themselves locked out of opportunities they were hoping to win.
Tussell is the market's trusted source of public sector framework and procurement insights.
We equip businesses with the insights they need to do more business with government and gain access to relevant opportunities in whichever market they operate.
Book a demo with the Tussell team to discover how Tussell can help you supercharge your public sector sales engine and find the frameworks your target accounts are actually using.
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Download Tussell, the IfG and AutogenAI's full report here.