Capita, Serco and Sopra Steria have volunteered to lead the way in this new best practice and are set to  complete their ‘living wills’ within weeks.

Cabinet Office minister David Lidington said: ‘Carillion was a complex business and when it failed it was left to government to step in - and it did. But we did not have the benefit of key organisational information that could have smoothed the management of the liquidation.

‘By ensuring contingency plans can be quickly put in place in the very rare event of supplier failure, we will be better prepared to maintain continuity of critical public services.’

In addition, the government is taking steps to improve the design of outsourcing projects from their inception. From next year, new complex outsourcing projects will be piloted with the private sector before deciding to roll the service out fully with these suppliers.

Lidington said: ‘By engaging earlier with the market on the design of outsourcing projects and by requiring pilots for new services we will learn from experience and deliver better public services for taxpayers.’

Central government is also to publish new data, not seen before, about the performance of critical contracts, such as response rates and if they are delivering on time, and the government’s supplier code of conduct is to be reviewed and enhanced.

The moves form part of new measures which Lidington said are designed to deliver better public services and use contracts as a ‘force for good’.

These include a requirement that by summer 2019, government procurements take social and economic benefits into account in certain priority areas. These include supporting small businesses, providing employment opportunities for disadvantaged people and reducing harm to the environment.

Report by Pat Sweet