Competition watchdog calls for overhaul of UK civil engineering procurement

The Competition and Markets Authority has called for significant reforms to the way major road and rail infrastructure projects are planned, funded and procured in the UK, warning that current practices are contributing to high costs, delays and weak productivity across the civil engineering sector.

image: HS2

In the final report of its Civil Engineering Market Study, the CMA said fragmented procurement, inconsistent project pipelines and short-term funding arrangements were limiting investment, constraining innovation and reducing confidence across the supply chain. The watchdog estimated that reforms to the sector could generate efficiency savings of up to £5bn a year.

The study focused on publicly funded road and railway infrastructure, excluding HS2, and examined how projects are designed, commissioned and delivered across the UK. According to the CMA, public bodies spent around £19bn on roads and rail infrastructure during 2023/24, but the market remains characterised by cost overruns, inconsistent quality and limited adoption of innovation.

Among the recommendations are longer-term capital funding settlements, clearer infrastructure pipelines, greater standardisation of designs and wider use of collaborative procurement approaches. The CMA also called for mandatory compliance with the government’s Construction Playbook for major procuring authorities, replacing the current “comply or explain” framework.

The watchdog said stop-start investment cycles and shifting political priorities were discouraging contractors from investing in skills, equipment and new delivery methods. It argued that more stable multi-year funding commitments would improve confidence across the sector and support longer-term planning.

Industry organisations have broadly welcomed the report’s focus on pipeline certainty and procurement reform. The Institution of Civil Engineers said many of the CMA’s findings reflected long-standing concerns around fragmented delivery structures, weak client capability and barriers to innovation.

The Chartered Institution of Highways & Transportation also said the report aligned with previous calls for stronger long-term infrastructure planning and greater consistency across public-sector procurement.

The CMA’s findings come at a time of continued pressure on the wider construction and infrastructure market. Recent industry surveys have pointed to fragile order books, rising input costs and uneven demand across different infrastructure sectors. While energy and airport-related projects have remained relatively resilient, road and rail workloads have been weaker in several parts of the market.

The report also highlighted concerns over procurement complexity, bespoke contract clauses and limited early engagement between clients and contractors, which the CMA said were contributing to higher bidding costs and greater delivery risk.

Recommendations included increased use of standardised contracts and designs, joint procurement between authorities and faster approval processes for new technologies.

The government is expected to respond to the recommendations within 90 days. The CMA launched the market study in June 2025 as part of a broader examination of how infrastructure delivery could better support economic growth and productivity.