The Competition and Markets Authority is carrying out unannounced inspections on several construction businesses after launching an investigation into possible bid-rigging in school contracts.
The CMA suspects several roofing and construction companies, including contractors and technical advisors, illegally colluded to secure contracts funded through the Condition Improvement Fund, which helps school buildings remain in good condition.
The competition watchdog has not named any of the firms being investigated but said it has particular concerns about roofing contracts.
CMA officers began inspections this week to gather relevant evidence, including physical or digital documents.
If the CMA provisionally concludes that the companies have broken competition law, it will issue what is known as a statement of objections. This details the CMA’s concerns and businesses have an opportunity to respond.
However, not all cases proceed to a statement of objections and the CMA said no assumptions should be made that the law has been broken at this stage.
Highly vulnerable to anti-competitive behaviour
The CIF is a budget from the Department for Education that funds projects addressing health and safety issues and building compliance. During the 2024-2025 round, it made available almost £450m in funding.
Public procurement makes up around a third of public expenditure and evidence from around the world suggests it is highly vulnerable to anti-competitive behaviour.
Last year, the CMA issued fines totalling almost £60m to companies involved in rigging both public and private sector bids.
The CMA pay financial rewards of up to £250,000 in return for information which helps it to identify and take action against illegal cartels.
This investigation comes ahead of the new debarment regime, which is expected to come into force in February 2025. Once in force, any business breaking competition law could also be banned from bidding on public contracts in the future.
Juliette Enser, executive director of competition enforcement at the CMA, said: “This fund is incredibly important and ensures that essential building improvements can be made to schools throughout England, meaning students are learning in safe and suitable environments.
“While no assumptions should be made that competition law has been broken at this early stage, we will be investigating this issue thoroughly. We will now be making enquiries and assessing the evidence to see whether or not bid rigging has taken place – and what further action may be needed.”
