CMA calls on Treasury to take strategic ownership of UK road and rail public procurement reform
Published on 15th June 2026
Following 11 months of analysis, it concludes that significant improvements are achievable in how infrastructure is planned, funded and procured through a package of 19 recommendations
At a glance
The CMA sets out 19 recommendations, seven deemed critical, addressing funding stability, procurement practice and regulatory complexity across road and rail.
Multi-year funding commitments, mandatory best practice and streamlined regulation would materially change the terms on which contractors can compete.
The government's response is due by late August, but full implementation remains uncertain and the package is designed to work as a whole.
The Competition and Markets Authority (CMA) has published its Civil Engineering Market Study final report, the culmination of 11 months of analysis carried out in the context of the UK government's Industrial Strategy and 10-Year Infrastructure Strategy. The study was conducted to identify the practical opportunities to improve competition and market outcomes in road and rail civil engineering, with the public sector spending around £19 billion a year on this. The CMA's conclusion is that costs are high, overruns are common and innovation is limited. Its view is that responsibility for this lies not primarily with industry but with the way government plans, funds and procures.
The diagnosis
The CMA identifies possible efficiency savings, based on the National Infrastructure Commission's research, of up to £5 billion a year, using an estimated 10 to 25% efficiency improvement to the annual spend of around £19 billion, though it acknowledges that realising these savings depends on meaningful implementation of its recommendations.
The CMA's assessment is that the market has been shaped by both demand-side and supply-side weaknesses, and that the two are interconnected. On the demand side, stop-start funding, inconsistent practices across hundreds of procuring authorities and overlapping regulatory requirements have weakened competition, raised costs and discouraged investment. Procuring authorities often lack the in-house commercial expertise and capability to scope projects effectively, evaluate bids on quality and long-term value, or engage with the market at an early stage: constraints the CMA treats as structural rather than incidental.
On the supply side, business dynamism has weakened over the past 20 years: smaller and newer firms have struggled to scale, larger suppliers have relied heavily on subcontracting in response to pipeline uncertainty, and investment in skills, capacity and innovation has been constrained. Suppliers, in the CMA's view, have responded rationally to poor demand signals, and the package of recommendations is designed to change those signals.
What the CMA recommends
The report contains 19 recommendations, seven of which are designated critical. The recommendations cover four broad themes: establishing strategic ownership of the market at government level; providing longer-term and more certain funding pipelines; reforming procurement practice to mandate best practice and reduce complexity; and streamlining regulatory requirements across road and rail.
The structural change the CMA is pushing hardest for is strategic ownership at HM Treasury level, backed by a published sector plan and annual performance reporting. According to the CMA, cross-government ownership at Treasury level is required to provide the coordination and authority needed to align the fragmented landscape of national bodies, devolved administrations and local authorities, and to hold them to account for delivery.
On funding, the CMA recommends multi-year capital budgets of at least three years for all procuring authorities, with greater flexibility to commit to contracts beyond budget settlement periods. For contractors and suppliers who have priced infrastructure bids against stop-start funding cycles, this would be a beneficial change to the commercial environment.
On procurement practice, it recommends:
- mandating the Construction Playbook, the government's existing guide to best practice in public sector construction procurement, for national authorities;
- requiring all future frameworks to meet the Gold Standards from the 2021 Mosey review on public sector framework procurement;
- a zero-based review of Z clauses, the bespoke contract amendments that authorities routinely add to standard model contracts; and
- standard designs for common structures such as bridges and gantries.
In the CMA's view, these measures would reduce bid complexity and cost, and shift competitive advantage towards suppliers with genuine delivery capability rather than those good at navigating procurement bureaucracy.
On regulation, the proposals include an industry challenge function for outdated standards, a single approved accreditation list across public road and rail, and fast-track approvals for new technologies. In the CMA's view, overlapping accreditation requirements disproportionately affect small and medium-sized enterprises (SMEs), as strict requirements are passed down supply chains and smaller firms are less able to absorb the additional costs, creating barriers to entry and to scaling.
What this means for contractors and procurers
For contractors and suppliers, the recommendations are intended to address several of the practical obstacles that currently limit investment and growth. Clearer, longer-term funding pipelines would allow more confident planning decisions on skills, capacity and technology. Simplified accreditation requirements and standardised procurement processes would reduce bid costs, particularly for smaller firms currently deterred by the expense and complexity of entering new frameworks. The CMA's proposal that national authorities publish target areas for supply chain innovation at least every three to five years would give firms a clearer steer on where investment is most likely to be rewarded.
For procuring authorities, the package represents a move from a comply-or-explain approach to one with harder requirements. Mandatory adoption of the Construction Playbook for national authorities, a requirement that all new frameworks meet the Gold Standards from the Mosey Review, and public performance reporting against delivery commitments would all represent a step change from current practice. The CMA is clear that these obligations are intended to drive consistency, not to add bureaucratic cost, but procuring authorities will need to assess the resourcing implications of compliance.
Timescale
The government is required to respond to the CMA's recommendations by late August, with the CMA asking it to set out a delivery timeline for each recommendation as part of its response. Within rail, the Office of Rail and Road's post-implementation review of the Railways and Other Guided Transport Systems (Safety) Regulations is required to report by 25 August 2026 (although it has stated an intention to report in June). The CMA expects its standards-streamlining work to run alongside that process.
Osborne Clarke comment
These potential reforms remain recommendations. Responses to the CMA's interim report from contractors, specialist subcontractors and industry bodies were broadly supportive of the reform. The CMA has been explicit that the recommendations are mutually reinforcing and that the package must be implemented in full to achieve its potential. The report acknowledges that some of the recommendations, particularly those requiring mandatory compliance by procuring authorities, involve short-term adjustment costs as well as potentially reduced budgetary flexibility for the government. It is now down to the government to decide whether it will adopt any of the CMA's recommendations.
