Are UK, France and Germany Having a Competition Crisis?

We recently completed a study of European government procurement changes in the three years up to and including 2020, to assess the impacts of Covid.

In the process of our work, one area of focus has been a year on year calculation of the number of bids per tender, across all Europe. Analysing the data has highlighted a marked drop in the number of bids in many Western European countries.

The below visualisation is a compilation of all available records by country by year and shows the average number of bidders. The data shows that some countries are becoming more competitive, such as Ireland, Lithuania and Sweden, however, many major western European economies have become progressively less competitive with fewer bidders per tender.

This is particularly noticeable in large western markets. France has seen a -57% bids per tender, Germany shows a reduction of -51% bids per tender. Not far behind is the UK with -48% bids per tender.

What’s interesting is, the pandemic does not appear to have caused this effect, the pattern had formed for all of these countries before 2020. Is there a competition crisis happening in these countries?

Average bidders per contract

In all three countries the decline in bidders was a well established trend before the Covid crisis hit, so what reasons could be behind these declines?

Is there a trend toward directly award contracts, or are unpublished tender opportunities on the increase? Either reason is cause for concern.

The links between transparency and increased completion in public procurement are well established. The Open Contracting Data Standard provides a framework for governments, to disclose data and documents at all stages of the procurement process.

While the extenuating circumstances of Covid have provided a rational for expedited process and increase in direct award in 2020, the table clearly shows this downward trend was well established prior the pandemic, and cause for concern.

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