The contract you signed is not the contract you are getting:

Most public sector procurement teams are good at awarding contracts. The specification, the evaluation, the due diligence, the governance: these stages attract attention, resource and scrutiny because they carry visible risk. Get them wrong and the consequences are immediate. A challenge from an unsuccessful supplier. A question from the audit committee. A headline nobody wants.

What happens after the contract is signed attracts far less attention, and that is where the problem sits. World Commerce and Contracting’s 2025 research found that organisations lose an average of 9% of contract value annually through poor contract lifecycle management. High-performing organisations hold that to around 3%. Lower-performing ones lose 15% or more. The same research found that contract-related data is typically scattered across an average of 24 different systems, making it nearly impossible to track commitments or act on problems in time.

For public sector organisations operating under sustained financial pressure, whether in local government, education, healthcare or emergency services, that kind of value erosion is not a back-office inefficiency. It is money that should be funding services, improving outcomes and delivering for the communities those organisations exist to serve.

A contract is a living relationship, not a filing exercise

The moment a contract is signed, it begins to drift from what was agreed. Not dramatically, and rarely through bad faith, but through the accumulation of small, unchallenged changes. A price adjustment that goes through without verification. A service level that slips by a fraction and is never flagged. A rebate that sits unclaimed because nobody remembered it was there. An innovation commitment the supplier made at tender stage that quietly disappears once delivery begins.

This pattern plays out across every part of the public sector. A council’s waste collection contract where the agreed recycling targets are never formally reviewed. An NHS trust’s facilities management agreement where response times have drifted from what was specified. A university’s IT services contract where the supplier quietly reduced the scope of on-site support. A fire and rescue service’s fleet maintenance deal where parts pricing has crept above the contracted schedule. The specifics vary. The dynamic is always the same.

Each of these on its own looks minor. Over the life of a three or five-year contract, they compound into something significant. And in most public sector organisations, the person now responsible for the contract is not the person who negotiated it. They may not know what the pricing mechanism was supposed to deliver. They may not have seen the tender responses that shaped the evaluation. They may not even know which KPIs were agreed, let alone how to report against them.

This is not a criticism of operational teams. It is a recognition that contract management has historically been treated as an administrative task rather than a strategic function. The result is that the value secured during procurement slowly leaks away after award, and nobody has the visibility to see it happening until the contract comes up for renewal and the numbers do not add up.

New transparency rules have changed the stakes

Until recently, a contract that underperformed was a private frustration. The organisation knew it was not getting full value, but the consequences were internal. That has changed.

In England, Wales and Northern Ireland, the Procurement Act 2023 introduced a set of post-award obligations that make supplier performance a matter of public record. Contracting authorities must set and publish at least three KPIs for public contracts exceeding £5 million. They must publish performance assessments against those KPIs. And from April 2026, they must publish quarterly payment data for payments above £30,000 on the Central Digital Platform. Performance notices must be issued when delivery falls short, and those notices are publicly visible.

In Scotland, the Procurement Reform (Scotland) Act 2014 requires contracting authorities with significant procurement spend to publish annual procurement reports detailing how contracts have performed against their procurement strategy. The Scottish Government’s emphasis on Fair Work First, community benefit and sustainable procurement creates additional accountability obligations that require active post-award management to evidence and report.

The practical effect across the UK is the same: a contract that drifts is no longer just a commercial problem. It is a compliance risk that is visible to regulators, to suppliers, to auditors and to the public. Organisations that do not have the systems and processes to track, measure and report contract performance are exposed in ways they were not before.

Where value actually leaks

The WorldCC research identifies where the losses typically occur, and the pattern is consistent across sectors. Cost overruns, invoicing errors, delayed delivery, scope disputes, missed entitlements and avoidable disputes all contribute. But in the public sector, three specific patterns stand out.

Price and spend drift. Contracts often include agreed rates, volume discounts or rebate mechanisms that only deliver value if someone actively monitors and enforces them. In practice, invoices are processed against purchase orders without being validated against the contracted rates. Off-contract spending creeps in as operational teams buy from familiar suppliers rather than contracted ones. This is particularly common in organisations with devolved budgets, such as multi-site NHS trusts, universities with autonomous departments or local authorities where individual service areas hold their own supplier relationships. Over time, the gap between what was agreed and what is being paid widens, and it does so invisibly unless spend data is being tracked at a granular level.

Performance without measurement. Many public sector contracts include service levels and KPIs, but too few organisations have the data infrastructure to monitor them in anything close to real time. Performance reviews happen quarterly if they happen at all, often based on supplier-provided data rather than independent verification. By the time a trend becomes visible, months of underperformance have already passed. Under the Procurement Act’s new reporting obligations in England, Wales and Northern Ireland, this approach is no longer sustainable. If you cannot measure performance, you cannot publish it, and if you cannot publish it, you are not compliant. In Scotland, annual procurement reporting obligations create a similar pressure: contracting authorities must demonstrate how their contracts have delivered against their published procurement strategy, which is difficult to do without consistent, evidence-based performance data.

Social value commitments that evaporate. Social value is now embedded in both the Procurement Act’s framework and Scotland’s sustainable procurement duties. Suppliers make commitments at tender stage, apprenticeships, local employment, community investment, carbon reduction, and those commitments form part of the evaluation that wins them the contract. But once delivery begins, social value is often the first thing to stop being tracked. A facilities contractor that promised apprenticeship places to a local college. A construction firm that committed to sourcing materials from local SMEs. A fleet provider that pledged to transition to lower-emission vehicles on a defined timeline. The commitment was genuine at bid stage. Without active management, it simply does not get delivered.

What effective post-award management looks like

The organisations that retain the most value from their contracts share a common characteristic: they treat post-award management as a continuation of the procurement process, not the end of it. That means three things in practice.

Visibility. You cannot manage what you cannot see. A single platform that consolidates spend data, contract terms, KPIs and supplier performance gives the contract owner the information they need to act, without chasing data across departments and spreadsheets. Line-level spend visibility is particularly important for identifying price drift and off-contract purchasing as it happens, rather than discovering it at contract renewal.

Ownership. Every contract needs a named owner who understands what was agreed, what the supplier committed to and what the reporting obligations are. That ownership needs to be formally handed over, not assumed. The knowledge that shaped the procurement, the pricing rationale, the risks that were flagged, the social value commitments, must transfer to whoever will manage the contract in delivery.

Capability. If contract management is going to sit with operational teams, those teams need the tools, training and access to specialist support that makes it possible. This is a particular challenge in organisations where procurement resource is limited: a school business manager overseeing a catering contract, a police force’s estates team managing a building maintenance agreement, or a clinical commissioning lead in a health board tracking supplier performance alongside their clinical responsibilities. It might mean procurement professionals staying involved through the early stages of delivery. It might mean structured performance review processes that are built into the contract from award. It might mean access to consultancy support when a dispute, variation or performance issue arises that falls outside the team’s day-to-day expertise.

The compliance case is now the commercial case

For years, the argument for better contract management was primarily financial: you are losing value, and you should not be. That argument still holds. But the transparency obligations introduced across the UK’s procurement legislation have added a compliance dimension that makes the case harder to defer.

Contract performance is now publishable, reportable and open to scrutiny. Organisations that cannot demonstrate how their suppliers are performing, how their social value commitments are being delivered, and how their payments are being made are exposed on multiple fronts. The financial cost of poor contract management has not changed. What has changed is that it is now visible.

Guy Stapleford is Head of Consultancy Services at Inprova Group

This article builds on themes explored in a piece for Social Housing

How Inprova can help

Quantum, our spend and contract management platform, gives your team a single view of spend, contract terms, supplier performance and KPI data across your entire supply chain, with line-level visibility that makes price drift and off-contract purchasing visible as it happens.

Procurement consultancy to help you design contract management frameworks, structure performance reviews and build the capability your teams need to manage contracts actively from award through to renewal. We work with customers across local government, education, healthcare and blue light services throughout the UK.

Compliant procurement routes including frameworks, Dynamic Purchasing Systems and Dynamic Markets with contract management support built in from day one.

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Sources

World Commerce and Contracting, Contract Management Whitepaper, August 2025

World Commerce and Contracting, Closing the Procurement Value Gap

Bird and Bird, Contractual performance and debarment under the Procurement Act 2023: implications for suppliers, June 2025

Ward Hadaway, Procurement Act 2023: KPIs and performance management, February 2025

Ward Hadaway, Procurement Act 2023: Guidance on KPIs, July 2025

Hill Dickinson, Procurement Act 2023: Supplier Performance

Scottish Government, Public sector procurement policy and legislation

Scottish Government, Scottish Procurement Policy Notes (SPPNs)