The Competition and Markets Authority (CMA) has written to public sector clients with a new warning about the dangers of bid-rigging and cartels.
The CMA has also created a new tool to help public sector procurers identify suspicious bids. It is being made available to the Chartered Institute of Procurement & Supply (CIPS) and the Local Government Association (LGA).
The Authority said the tool would help procurers and supply chain professionals “understand why bid-rigging is harmful, learn how to spot tell-tale signs that suggest a bid may be illegal, deal with suspect bids and know where to go for further help”.
The CMA’s open letter to procurers explains the main issues in bid-rigging and draws their attention to the new tool. The Authority has produced a summary video to provide further information and advice.
In 2013/14 the UK public sector spent £242bn on procurement of goods and services, of which around £60bn is spent by local government. The CMA said that evidence suggests that cartels – of which bid-rigging forms a part – overcharge by up to 20%.
In 2009, 103 construction firms paid out fines totalling £129m after widespread evidence of bid-rigging was discovered in local authority tenders. A CIOB report in 2013 found that more than a third of respondents believed corruption was still widespread in the industry.
John Kirkpatrick, CMA senior director advocacy, said: “Bid-rigging can cost taxpayers and consumers many millions of pounds. This e-learning package will help procurers spot cases and root out attempts to cheat before they cause any damage.
“The CMA has a hotline which people can call if they suspect cases of bid-rigging or other anti-competitive practice, so I urge anyone with doubts to call.”
David Noble, group CEO of CIPS, said: “We welcome this useful tool to help anyone responsible for public money to reduce fraud and corruption in the procurement process, and our members will welcome it too.
“This is too important an issue to allow these bad behaviours to colour the good that sound procurement and supply chain management brings to the public sector.”
Anyone suspecting cartel or bid-rigging activity can contact the cartels hotline on 0800 085 1664 or 020 3738 6888 or email [email protected].
