The UK public sector spends £300bn a year buying good, services and works from the private sector. UK local government procurement alone accounts for £60bn a year. This represents a huge market and a significant lever public authorities can use to create and shape markets.
However, despite all this potential to drive strategic outcomes, public procurement is largely under-exploited as a mechanism for sparking and scaling innovation. The UK Government’s Innovation Strategy notes “a low appetite for risk and experimentation” in public procurement, due to “the overall culture, expertise and incentive structure of the public sector”. As a result, UK public procurement is still largely characterised by procedures which over-specify on requirements (leaving little room for innovation) and select based largely on price. Faced with a whole box of tools, procurement professionals invariably reach for the same procedure each time.