The Competition and Markets Authority (CMA) has published the findings of its in‑depth market study into public rail and road infrastructure, setting out a clear agenda for reform aimed at cutting costs, boosting productivity and unlocking innovation across the sector.
Following 11 months of analysis and engagement with government, procuring authorities and industry, the CMA concludes that long‑standing approaches to procurement in road and rail are undermining value for money and holding back growth. The regulator argues that a more strategic, coordinated and long‑term approach could transform delivery and strengthen the UK’s civil engineering market.
At the heart of the CMA’s recommendations is a call for government to treat rail and road procurement as a strategic economic lever, rather than a series of disconnected projects. While the study focuses on transport infrastructure, the CMA believes the lessons apply more widely across public infrastructure procurement.
Sarah Cardell, Chief Executive of the CMA, said:
“Our work on civil engineering shows that a short term and fragmented approach to procurement in road and rail is driving up costs, slowing delivery and holding back innovation.
This is an opportunity for systemic change – but it requires strong central coordination, and a reframing of road and rail procurement as a lever for growth and innovation.
The CMA will continue to play its part, bringing independent advice, analysis and practical solutions to drive economic growth.”
The cost of getting procurement wrong
In 2023/24, around £19 billion of taxpayers’ money was spent on public road and railway infrastructure, excluding High Speed 2. Despite this scale of investment, the CMA’s study finds that these markets have persistently underperformed in terms of productivity, innovation and speed of delivery.
The CMA identifies several structural issues driving poor outcomes, including funding uncertainty, short‑term decision making, complex regulatory frameworks and capability gaps within procuring authorities. Together, these factors weaken competition, deter investment and limit the sector’s ability to innovate.
External research referenced in the CMA’s report suggests that UK and devolved governments could potentially save up to £5 billion a year by tackling these challenges. Crucially, the CMA argues that savings could be achieved while also reducing delivery times, increasing innovation and supporting UK firms to grow and compete internationally.
A clear agenda for reform
To address these issues, the CMA has set out a targeted package of reforms for public road and rail civil engineering, centred on five core recommendations:
- Strategic ownership for driving change: the CMA recommends that HM Treasury takes strategic ownership of system‑wide reform, reflecting its overarching responsibility for infrastructure strategy and its ability to convene departments and deploy policy levers across government.
- A clear plan for the sector: the UK Government, working with the Scottish and Welsh Governments and the Northern Ireland Executive, should publish a strategic sector plan for road and rail civil engineering and report annually on progress.
- Credible long‑term pipelines: the introduction of multi‑year funding settlements and clearer forward pipelines to give industry the confidence to invest in skills, capacity and innovation.
- Procurement designed for long‑term value: improvements in how projects are scoped, procured and delivered to promote competition, lower costs and incentivise innovation.
- Building public‑sector capacity: addressing skills and capability shortages within procuring authorities through shared expertise, strengthened capability and smarter joint procurement.
The CMA argues that, taken together, these reforms would strengthen competition, raise productivity and create new opportunities for UK scale‑ups, while also speeding up delivery and ensuring public investment works harder for the economy.
Strong backing from industry
The recommendations have been welcomed by industry bodies, who say the report reflects long‑standing concerns across the civil engineering and infrastructure sectors.
Sam Gould, Director of Policy and External Affairs at the Institution of Civil Engineers, said:
“The recommendations in today’s CMA study align with many the ICE has championed. We’re particularly happy to see the CMA recommend mandatory use of the Construction Playbook. This will help enable faster infrastructure delivery. We’re also glad the CMA has echoed the ICE in saying that the Treasury should oversee driving system-wide change, with the support of NISTA.
While the current recommendations only apply to rail and road, embedding them could provide useful insight and lessons for other sectors. The government should consider applying them more broadly. Now the government must accept and enact the recommendations so civil engineers and infrastructure professionals can get on with delivering the infrastructure the UK needs.”
Ben Goodwin, Director of Policy and Public Affairs for the Civil Engineering Contractors Association, added:
“By calling for the UK and devolved governments to set a strategic direction for infrastructure, the CMA’s recommendations show a clear path towards greater pipeline visibility, more efficient procurement, and better outcomes for businesses, communities, and the wider economy.
We strongly support the CMA’s conclusion that reforming the civil engineering market can deliver a powerful multiplier effect: improving value for money from public investment, strengthening supply chain confidence, and making the UK a more attractive place to invest.
We look forward to working with our members, clients, and industry stakeholders to ensure this report acts as a catalyst for the reform that is needed - supporting growth, creating jobs, and delivering world-class infrastructure for the 21st century.”
What happens next?
The CMA has formally written to key Cabinet ministers, devolved administrations and metro mayors setting out its recommendations. The UK Government has committed to responding within 90 days.
Further CMA analysis and recommendations on public procurement and market shaping are expected later this year, alongside continued enforcement action to tackle bid‑rigging and anti‑competitive behaviour in public sector markets.
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