CMA looks for feedback after sounding alarm over ‘constrained’ civil engineering sector

Volatile funding, failing procurement policies, capacity constraints and unnecessary regulation barriers are the primary factors keeping the UK’s public road and rail civil engineering sector in a negative cycle, the competition watchdog has warned.

In its recently published interim report on public road and rail civil engineering works, the Competition and Markets Authority (CMA) said that the civil engineering market is currently leaving participants constrained by wrong incentives, creating a cycle of higher costs, project overruns and lower investment in new approaches.

The interim report was published in relation to the CMA’s statutory market study into the civil engineering sector, announced in June 2025. The study seeks to find ways to create a more stable funding environment that would enable longer-term planning, as well as to identify ways of improving public procurements.

Dr Totis Kotsonis, a procurement expert with Pinsent Masons, explained some of the proposed remedies aim at changing public sector behaviours as regards the conduct of public procurements. “For example, whilst public sector bodies might consider long-closed frameworks should be favoured in that they render public contract awards, at least administratively, easier and less costly, the CMA’s position, quite rightly, is to favour greater competition by, amongst other things, greater use of open frameworks which allow new suppliers to become framework participants when the framework is periodically re-opened during its term,” he said.

“At the same time, the CMA’s view that contracting authorities should make greater use of early contractor engagement before the launch of public procurements requires careful consideration by both contracting authorities as well as suppliers,” he added.

“Unless handled carefully, such engagement can undermine the fairness and competitiveness of a procurement process and introduce conflicts of interest.

“Equally, the idea of providing for less complex and more standardised procurements might in principle make sense as a means of addressing contracting authority constraints and facilitating greater supplier participation but once again, unless handled carefully, this may lead to the design of procurements which do not take due consideration of the particularities of the contract being awarded.”

The CMA now aims to publish its final report and recommendations for the government in April, after the conclusion of a consultation on the interim findings (75-page / 912KB PDF), which ended earlier this week. The statutory deadline for completing the study is 18 June.

The interim report includes potential remedies, such as fast-tracked approaches to approving new technologies which would benefit civil engineering projects, and setting standardised approaches to project administration, with the package aimed at creating more stable and transparent project pipelines, strengthening procurement capability, streamlining regulatory requirements, and promoting greater collaboration across government and industry.

The package of proposed remedies targets the problems the CMA has identified on both the demand and supply sides including short‑term and volatile infrastructure funding; limited commercial and engineering expertise among public sector procurers; procurement policies that undermine long‑term competition; and regulatory barriers, such as planning processes and standards, that deter entry and stifle innovation.

The CMA has said that it does not currently expect a market investigation to result from the study, which means that any proposed remedies will be in the form of recommendations which will not be binding. The government has given a general commitment to provide its response to any CMA recommendations within 90 days.

“Building on the work of other expert bodies in this field, we’re focused on identifying concrete ways to deliver better outcomes in these critical infrastructure markets,” said CMA chief executive Sarah Cardell.

“Early areas of focus include enhanced competition and innovation in supply chains, through greater opportunities for scaling and removal of regulatory barriers – and more effective public procurement processes. At the same time, we want to enable legitimate collaboration – across government, public authorities and industry – to support investment and growth.”

The study was the first opened after the Digital Markets, Competition and Consumers Act 2024 (DMCC Act) came into force, and since the CMA announced its ‘4Ps’ framework – pace, predictability, proportionality and process.

Giles Warrington, competition law expert with Pinsent Masons, said: “This market study is unlike many CMA market studies and investigations we have seen recently. 

“Whilst the aim of the markets regime is to enable the CMA to study the features of a market without necessarily focussing on the behaviour of market participants, much markets work has included at least recommendations or remedies addressed to market participants. 

“This study has been largely focussed on strategic themes related to public sector procurement, and so the CMA is living up to its promise to ‘dial up its role as an enabler of competition through advice and recommendations to government’ as promised in its draft 2026-27 Annual Plan published recently. 

“With the markets regime subject to legislative proposals designed to streamline and shorten the regime, and with the CMA continuing to focus on its advocacy role, we may expect to see other similar markets work in future.”