More than half of £31bn public spend with private equity firms goes overseas

By the Editorial Team · Tuesday, September 29, 2026

In 2024-25, over half of the UK public sector’s £31 billion spending on private equity-backed companies went to firms ultimately owned overseas, totaling around £17 billion. This has sparked calls from the GMB union for procurement reforms to prioritize domestic economic benefits, alongside government efforts introducing a new social value model to enhance support for British businesses and jobs.

Public sector spending with private equity-backed companies in the United Kingdom has seen more than half of a £31 billion total in 2024-25 directed toward firms ultimately owned outside the country, according to recent analysis. The data, compiled by the GMB union in conjunction with procurement analyst Tussell, indicates that approximately £17 billion of public money went to companies whose ultimate owners are based overseas, while around £13.7 billion was spent on domestic firms.

The analysis was derived from invoices published by public sector bodies and segmented according to the global ownership of private equity-backed suppliers, focusing on ownership rather than the location where contracted work was performed. This distinction highlights the flow of public funds and raises questions about the domestic economic impact of such expenditures.

The findings have prompted calls from the GMB union for legislative changes aimed at ensuring that taxpayers’ money supports jobs and supply chains within the UK. The union plans to propose a motion at the Labour Party conference urging ministers to maximize UK content and supply chain opportunities in key publicly funded sectors, including energy, defense, housing, and infrastructure projects. GMB general secretary Gary Smith criticized current procurement policies as “broken,” arguing that they allow billions in public funds to flow to offshore-owned companies and stressed the need for reforms that guarantee better job prospects and opportunities at home.

These developments come shortly after the government announced a new social value model designed to influence central government procurement starting in January. The model sets out criteria for evaluating businesses bidding for public contracts based on their contributions to high-quality jobs, addressing local skills shortages, providing apprenticeships, and facilitating work placements. The government has stated its intention for every pound spent on public procurement to support British businesses, stimulate growth, and foster a fairer economy. This framework will apply to central government departments, executive agencies, and non-departmental public bodies.

Labour was elected on a platform pledging to increase domestic manufacturing, purchasing, and sales. However, Smith pointed out that the current situation “is still broken” and emphasized that a Labour government must improve the procurement system to better serve the UK economy.

In response, the Cabinet Office reaffirmed its commitment to ensuring that public spending delivers tangible benefits for communities across the country by creating jobs, enhancing skills, and promoting growth. The announcement signals ongoing efforts to strike a balance between attracting investment and safeguarding the economic interests of the UK through public procurement policies.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.