The move follows a string of complaints about unnecessary red tape and the prohibitive costs of bidding by contractors.

The review will look at how public bodies involved in construction procurement adopt practices that are streamlined and deliver value for taxpayers’ money.

It will also address the use of cutting edge design and technology, energy efficient techniques, materials and eco-friendly construction methods.

Robin Crawford, a non executive Director and a former forensic partner in KPMG  and Ken Lewandowski, former Chairman of the Clydesdale Bank Financial Solution Centres in Glasgow and Edinburgh, have been appointed to lead the review which is expected to be completed by summer 2013.

Nicola Sturgeon, Deputy First Minister and Cabinet Secretary for Infrastructure, Investment and Cities, said: “The review will examine how we can improve the impact of this spending on Scotland’s economic growth and on the quality of Scotland’s built environment.

“In spite of Westminster’s significant cuts to our capital budget, we are working flat out to maximise investment in infrastructure projects and to improve the way the procurement system operates.

“This review will play a fundamental role in paving the way forward for our construction sector, helping to support jobs, to promote sustainable working practices and, most importantly, reaping maximum gains for Scotland’s economy.”

Robin Crawford, who will Chair the review, said “Clearly, in the current economic climate it is essential for both the industry and its clients that the procurement system operates as efficiently as it can.

“We will draw on the best examples of good practice in procurement in both the public and private sectors and will take account of earlier relevant reports on aspects of this issue.

“I am determined that the review will both identify what needs to change and will put in place measures that ensure that the necessary improvements are delivered.

“We will listen carefully to the views of all stakeholders before reaching our conclusions.”

Ken Lewandowski added: “Having worked with construction industry representatives for some time and listened to their concerns I know how important this review is.

“I know that we have an opportunity to make a real difference am absolutely delighted to be invited to work with Robin on leading the review.”

Alan Watt, Chief Executive of the Civil Engineering Contractors Association, said: “The procurement burden comes close behind workload security in the major concerns expressed by infrastructure construction businesses across Scotland.

“This review, following on from the Government’s Public Contracts Scotland portal and standard Prequalification Questionnaire, will hopefully pave the way for more streamlined construction procurement to save money and help preserve jobs.”