Cabinet Office minister Francis Maude said this was the first time a government contract had required a prime contractor to run open competitions for subcontractors. It takes forward commitments to open up more government work to small and medium-sized enterprises, he said.

‘This new contract exposes the myth that there is an inherent contradiction between centralising procurement and supporting small businesses,’ he said.

It would lead to ‘more opportunities for smaller players, more innovative training approaches for civil servants and greater savings for taxpayers’.

The contract has been awarded by Civil Service Learning, one of the human resources ‘hubs’ established last year to simplify the government’s HR practices and reduce costs.

Capita’s bid pledged to cut the cost of classroom courses by up to 70%. The company will run open competitions for at least 51% of the services it delivers, and these will be audited by the government.

Jenny Arnott, director of Civil Service Learning, said: ‘Through working with the open market, we also expect to gain more flexible access to a range of solutions that will improve the overall quality of training provision across the civil service.’