Optimization
Check every tender while it is open, not after the contract is signed.
We think every public tender should be checked for weak competition while it is still open. Before award, a buyer can still extend a deadline or widen a specification, and after award the money is committed. The OECD reports that public procurement rose from 11.8% to 12.9% of GDP across OECD countries between 2007 and 2021, and calls it the government activity most vulnerable to waste, mismanagement and corruption.
How can AI detect red flags in public procurement?
AI can check every tender while it is open and mark the ones that deserve a closer look. We would load published contracting data, compute red flags such as single bids and short bidding windows, compare prices with similar purchases and read tender documents for unusual terms. Each flag comes with its evidence. Procurement officers and auditors review the flags, and a named official decides what happens next.
Weak competition is spotted too late
World Bank economists estimated public procurement at about $11 trillion in 2018, out of global GDP of nearly $90 trillion. Health is the largest category, at about a third of OECD procurement spending.
In the EU, competition is thinning. The European Court of Auditors found that 42% of EU contracts in 2021 were awarded when only one company bid, and that the number of bidders per procedure fell from roughly six to three over the decade to 2021. An audit that finds a single-bid contract after award comes too late to change its price.
What we would model, and with which data
Many governments already publish procurement data, so a first model can start without a data-sharing agreement.
- Contracting data in the Open Contracting Data Standard, or OCDS, a common data model for every stage of a contract. The Open Contracting Partnership's registry lists data from over 100 publishers.
- Notice portals, such as Tenders Electronic Daily, the EU's supplement to its Official Journal for public tenders.
- Tender documents, bids and contracts, which hold terms that structured data misses.
- Company registers, to link suppliers that share owners or addresses.
- The World Bank's Global Public Procurement Database, which compares procurement laws, e-procurement systems and procurement cycle metrics by country.
How the model is built and checked
A red flag is a published risk indicator, such as a tender that drew one bid or a bidding window far shorter than usual, and the model computes each flag for every tender. Price benchmarks compare unit prices for the same item across buyers and over time. Document reading converts tender PDFs to text, and a language model compares eligibility terms with similar tenders to find unusually narrow ones. Record linkage connects bidders that share a director or an address. Auditors review a sample of flagged and unflagged tenders, and we report both the share of flags they confirm and the cases the model missed.
What decision-makers get
The most valuable flag is the one raised before award.
- Procurement teams see risk on open tenders while there is time to act.
- Audit offices get a ranked list of past contracts to examine, each with its evidence.
- Finance ministries get price benchmarks and an estimate of what more competition would save.
- Sustainability teams can track green purchasing. The OECD found that 35 of 38 member countries have green public procurement frameworks, but only 3 have methods to measure environmental impact.
A first project picks one buyer or one category, such as medical supplies. We would load the published data, compute flags and benchmarks, back-test them against past audit findings and hand over a scorecard. The buyer then decides whether to continue.
How it runs safely
A flag starts a review. It never cancels a tender or accuses a firm.
- An officer or auditor reviews each flag, and a named official decides any action.
- Commercially sensitive bid data stays in the buyer's systems.
- Fairness checks watch whether flags fall more often on small or new suppliers.
- We log every flag with its inputs and indicator version, so an auditor can trace it.
- Procurement law differs by country, and this page is not legal advice.
Open-source building blocks
Buyers, auditors and suppliers can rerun the same open checks. The Open Contracting Partnership maintains the first four tools.
- Kingfisher Collect, which downloads OCDS data from publishers.
- OCDS Kit, command-line tools for working with OCDS data.
- Cardinal, which calculates red flags such as single bid received and short submission period.
- lib-cove-ocds, which checks OCDS data against the standard.
- Docling, started at IBM Research Zurich, which converts PDFs and other documents into structured text.
- Splink, for linking supplier records across registers.
Has extendfuture built this for a procurement agency?
No. Optimization is a new extendfuture offering. Our production work so far is AI for companies, with accuracy measured as a number, human review and an audit trail.
Is a red flag proof of corruption?
No. A flag marks a tender for review. Many flagged tenders have a good reason, such as a specialist product with one maker.
What if our data is not in OCDS?
We would map it. Mapping a buyer's records to the standard is usually the first step, and it also lets the buyer publish open contracting data.
Can suppliers use this?
Yes. Published contracting data is open, so a supplier can see which buyers run competitive tenders and what similar contracts cost. Company purchasing teams can run the same flags and price checks on their own suppliers.
Sources
- OECD, Public procurement
- World Bank blog, How large is public procurement?
- European Court of Auditors, report 28/2023
- OECD, Government at a Glance 2025
- Open Contracting Data Standard
- OCP Data Registry
- Tenders Electronic Daily
- World Bank, Global Public Procurement Database
- Kingfisher Collect
- OCDS Kit
- Cardinal
- lib-cove-ocds
- Docling
- Splink
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