The new measures include tougher scrutiny of costs and greater transparency by including new open book accounting clauses in contracts to allow DfID to inspect costs, overheads and fees of suppliers in detail, and clauses giving DfID the power to intervene to prevent profiteering, policed by a rolling programme of compliance checks.

DfID has already introduced new contract terms and conditions to apply to all new procurement tenders and extensions from 1 September 2017.

It will also begin to renegotiate existing contracts in line with these changes, focusing initially on major, high-value contracts. These are contracts individually totalling over £20m, which account for a third of the overall value of DfID’s contracts and are delivered by the 30 biggest suppliers.

The department will publish annual league tables of supplier performance to name and shame those who are not delivering value for money, and says it will stop so-called ‘bid candy’ practices, by which large suppliers include smaller businesses to win bids, but then drop them from the contract.

There is a new code of conduct to ensure the highest standards of ethical and professional behaviour by DfID suppliers, with legally enforceable sanctions - such as ending contracts early – for those caught breaking the rules by the department’s new compliance team.

DfID says it is also cutting red tape to boost competition and open up DfID’s market to new businesses including small enterprises in the UK and the world’s poorest countries.

Priti Patel, international development secretary, said: ‘These tough reforms provide a clear message to aid suppliers – any misuse of taxpayers’ money is a scandal that will not be tolerated.

‘New legal penalties allow us to take firm action against those who break the rules.’

Guidance on DfID’s Supplier Review is here.

Report by Pat Sweet