Government departments will be encouraged to take a more flexible and challenge-led approach to procurement under a new package of measures being rolled out by the Department for Science, Innovation and Technology (DSIT).
The plans, outlined by Toni Peters, commercial deputy director for Growth, Science and International, Grants Hub & Commercial Innovation Hub, mark the next stage of government’s push to use public procurement more effectively to solve complex problems, support innovative suppliers and improve public services.
Speaking as the Commercial Innovation Hub published its first annual report, Peters said the focus is now shifting from establishing the foundations of innovation procurement to embedding those approaches across government.
“The big message is simple: innovation isn’t optional – it’s fundamental,” she told Think Digital Partners.
“Over the past year we’ve moved from policy intent into delivery. We’ve set up the Commercial Innovation Hub as a centre of excellence, built a clear pipeline of pathfinder projects, and started to put the tools in place that teams actually need to use procurement as a lever for innovation.”
However, Peters acknowledged that significant barriers remain.
“The report is equally honest about the challenges. Even with strong political backing, governance and process can slow progress,” she said.
“So the standout message is this: we know what works, we’ve started proving it in practice, and now it’s about scaling that consistently across government.”
Moving beyond traditional procurement
Central to that next phase is a new procurement of innovation playbook, accompanied by training designed to help commercial and digital teams put innovation-led procurement into practice.
According to Peters, the initiative is intended to deliver practical change rather than simply add to the volume of guidance already available across government.
“This isn’t another guidance document that sits on a shelf. It’s designed to change behaviour,” she said.
Among the changes teams can expect are “a shift towards challenge-led procurement – starting with the problem, not a predefined solution”, alongside greater use of the commercial mechanisms available through the Procurement Act 2023.
The playbook will also include “simpler, clearer tools – decision trees, templates, and IPR guidance that make it easier to act”.
Training will be just as important as the guidance itself, added Peters.
“We’re not just publishing a playbook; we’re building capability so teams feel confident using it day-to-day.
“In practice, that means earlier engagement with the market, more iteration through the procurement process, and a much stronger link between policy ambition and commercial delivery.”
Innovation champions in every department
Another element of the programme will see departments appoint procurement of innovation champions to drive adoption from within.
“The champions are about ownership and accountability,” said Peters.
The senior leaders, who will sit outside commercial teams, will act as advocates for innovation-led procurement, challenge established approaches and help remove obstacles when teams encounter them.
“This isn’t an honorary role. It’s about embedding innovation into the way departments operate.”
For delivery teams, she said, the benefits should include “clearer senior backing, quicker decisions, and someone who can help navigate the system when you’re trying to do something different”.
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Turning pathfinders into practical guidance
Alongside the playbook and champion network, the Commercial Innovation Hub has identified five Pathfinder projects intended to test innovative procurement approaches in real-world settings.
“The pathfinders are deliberately focused on real, messy, cross-cutting problems – from planning and education to defence and issues arising from emerging technologies,” explained Peters.
Importantly, she stressed that the projects are not innovation exercises for their own sake.
“They’re not pilots for the sake of it. They’re live procurements testing how we apply innovative approaches in practice.”
The focus, she said, will be on capturing lessons that can be applied elsewhere across government.
“What matters is what we learn: what worked, what didn’t, where the system got in the way.”
Rather than producing lengthy reports, those lessons will be translated into practical tools and guidance for other teams.
Earlier engagement with suppliers
The Commercial Innovation Hub is also preparing to launch an innovation marketplace designed to support pre-market engagement between government and suppliers.
Peters described the initiative as “a step change in how we signal demand to the market”.
The marketplace will provide a single point through which public sector organisations can present challenges and suppliers can engage before formal procurement processes begin.
For smaller suppliers, Peters believes the approach could help address long-standing barriers to public sector engagement.
“For SMEs in particular, that’s critical. It gives them a clearer line of sight on opportunities, the ability to shape solutions, and a fairer chance to compete.”
Balancing innovation and accountability
Concerns around risk and value for money remain among the biggest barriers to innovation procurement, according to Peters.
“This is one of the biggest barriers, and we’re tackling it head-on,” she said.
The Hub is working with organisations including the National Audit Office, Public Accounts Committee and Cabinet Office to create a more consistent understanding of how innovation should be assessed and governed.
“The key shift is moving from risk avoidance to risk management,” said Peters. “Innovation will always carry uncertainty – but done well, it can deliver significantly better outcomes and long-term value.”
Ultimately, however, Peters believes the success of the programme will depend on culture as much as process.
“We can put in place playbooks, platforms and structures – but the real shift is giving teams the confidence, permission and support to do things differently.
“There’s a huge opportunity here. Government is one of the largest buyers in the economy. If we use that spend deliberately to solve problems differently, we can drive innovation, support UK businesses, and deliver better outcomes for citizens.
“That’s what this agenda is really about.”
