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Private firms still think the government is a poor customer in spite of efforts to improve public procurement, the Confederation of British Industry (CBI) has warned.

A survey carried out by the CBI showed three quarters of firms think public sector procurement needs 鈥渇undamental change鈥�.

More than two-thirds said taxpayers were getting bad value for money. The public sector spends around 拢100bn a year on private sector goods and services.

Problems negotiating terms and conditions, failure to address policy issues at the outset and inadequate specifications from the procuring authorities were blamed for rising costs and delays.

Nine out of 10 firms said specifications get changed by government clients during or after procurements and 76% said processes tend to suffer 鈥渟ignificant鈥� delays.

More than half of respondents said costs had increased 鈥渟ubstantially鈥� over the last five years.

Neil Bentley, CBI director of public services, said: 鈥淧ublic procurement processes are too often characterised by unnecessary delays, high costs and changed specifications.

鈥淭he government is beginning to make an effort to fix the problems, but progress is too slow and taxpayers are losing out.

鈥淎s we enter a tighter public spending period, buying goods and services competitively from the private sector will become increasingly important in ensuring the public get value for their tax pounds, on everything from paperclips to new hospitals.鈥�

He added that procurement problems and poorly trained public sector staff were discouraging firms from bidding for contracts. 鈥淚mproving skill levels must remain a key priority for government,鈥� he said.