London procurement teams face mounting cost and compliance pressures, North American survey suggests

A survey of 100 public-sector procurement professionals across North America, released this week by software provider Euna Solutions, has found that 74% of respondents identify rising costs of goods and services as their top external challenge, while 46% still manage procurement primarily through spreadsheets, email, or paper. The findings, drawn from responses collected between 1 and 30 June 2026, also show that more than 40% of procurement departments say they are not prepared to implement artificial intelligence tools.

The report, titled the 2026 State of Public Procurement, is based on a North American sample and does not directly cover UK or London public bodies. However, for procurement teams at the Greater London Authority, Transport for London, and the 32 London boroughs, the pressures it identifies — rising costs, compliance burdens, staffing shortages, and slow technology adoption — will be familiar. London’s procurement landscape is shaped by different legal frameworks, including the Procurement Act 2023, which came into full effect in February 2025, and the GLA’s Responsible Procurement Policy, but the underlying operational challenges show strong parallels.

Key facts
| Metric | Finding |
|——–|———|
| Top external challenge | 74% of respondents cite rising costs of goods and services |
| Top priority for next 12-18 months | 50% rank streamlining and automating processes first |
| Manual systems still in use | 46% manage procurement via spreadsheets, email, or paper |
| AI readiness gap | More than 40% say their departments are not prepared to implement AI |

Cost pressures and the procurement squeeze

The survey’s headline finding — that nearly three-quarters of procurement leaders see rising costs as their primary external challenge — reflects a reality that London’s public sector knows well. TfL, which spends roughly £10 billion annually on operations and capital projects, has faced sustained cost inflation in construction materials, rolling stock, and professional services. Boroughs responsible for housing, highways, and social care have reported similar pressures, with the London Councils organisation noting in its 2025-26 budget submission that procurement cost inflation was outstripping core funding increases.

The report identifies “implementing cost-reduction strategies” as the second-highest procurement priority for the next 12 to 18 months, selected by 40% of respondents. For London, this is not simply a matter of cutting budgets. The GLA’s Responsible Procurement Policy requires bidders to demonstrate social value, fair wages, and environmental sustainability, which can add compliance cost even as agencies seek savings. Balancing these obligations against rising prices is a recurring tension in borough procurement committees and TfL board papers.

Compliance pressures and the new procurement regime

The survey does not break out compliance as a separate metric, but its emphasis on automation and process streamlining points to a system under regulatory strain. In London, the Procurement Act 2023 introduced a new regime for public contracts, including a duty to have regard for “maximising public benefit” and new transparency requirements for contract notices and modifications. For borough procurement teams, this has meant additional documentation, training, and audit readiness.

The report notes that 50% of respondents rank streamlining and automating processes as their top priority — the same position the objective held in both 2024 and 2025. “Automation’s three-year position as the top priority indicates that agencies recognise the need to modernise but continue to face implementation barriers,” the report states. For London, those barriers include legacy IT systems, fragmented procurement data across multiple boroughs and functional bodies, and the challenge of integrating social value scoring into automated workflows.

Technology gaps and AI readiness

Perhaps the most striking finding for London readers is the technology gap: 46% of procurement professionals still rely on spreadsheets, email, or paper as their primary tools. In a city where TfL has invested heavily in digital asset management and the GLA runs the London Datastore, the persistence of manual procurement processes in boroughs and smaller public bodies is a known issue. The London Office of Technology and Innovation (LOTI) has run pilot projects on shared procurement platforms, but adoption remains uneven.

The AI readiness figure — more than 40% of departments say they are not prepared to implement AI — is particularly relevant as the GLA and boroughs begin exploring AI use cases for planning, transport, and contract management. The report does not specify what “prepared” means, but it suggests a gap between policy ambition and operational reality. London’s AI Strategy, published by the GLA in 2023, promotes responsible AI adoption across public services, but procurement teams may lack the data infrastructure, staff training, or supplier frameworks to move quickly.

Tom Amburgey, CEO of Euna Solutions, said in the report’s press release: “Public procurement is one of the quiet engines of government. Residents may never see the work behind it, but they feel the results in the quality and reliability of public services. The opportunity ahead is to give procurement professionals the support and technology they need to spend less time navigating workarounds and more time creating value for their communities.”

While Amburgey’s comments are aimed at a North American audience, the sentiment applies to London. The GLA’s own procurement data, published via the London Datastore, shows that the authority and its functional bodies awarded contracts worth more than £15 billion between 2020 and 2025. Each of those contracts involves compliance checks, social value scoring, and supplier due diligence — all of which are harder to manage on spreadsheets.

What this means for London readers

The Euna Solutions survey is not a direct study of London procurement, and its sample of 100 North American professionals is relatively small. UK readers should treat the specific percentages as indicative rather than directly transferable. However, the pattern it describes — rising costs, compliance strain, slow technology adoption, and AI unpreparedness — matches what London procurement officers have reported in their own surveys and committee papers.

For residents and built-environment professionals, the practical consequence is that procurement delays and inefficiencies can slow down housing delivery, transport upgrades, and public realm projects. A borough that takes longer to award a contract for new cycle lanes or a housing retrofit programme may be struggling not with policy but with procurement capacity. The report’s findings reinforce the case for shared procurement platforms, better data standards, and targeted investment in procurement technology across London’s public bodies.

The next step for interested readers is to check the GLA’s procurement transparency page and the London Datastore for contract award notices, and to watch for the Mayor’s next procurement strategy update, expected later this year. The Euna Solutions report itself is available from the company’s website, though it is based on North American data and should be read with that caveat in mind.

Source: Smart Cities Dive, “Rising costs, compliance pressures are top challenges for public procurement leaders: survey,” 16 September 2026, https://www.smartcitiesdive.com/news/procurement-public-sector-challenges-euna-solutions-survey/830545/

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