The Government has identified the Procurement Act 2023 (“Procurement Act”) as “one of the largest shakeups of procurement rules in this country’s history”.
The Procurement Act will revoke the Public Contracts Regulations 2015, the Utilities Contracts Regulations 2016, the Concession Contracts Regulations 2016, and the Defence and Security Public Contracts Regulations 2011. In so doing, it will establish a new public procurement regime regulating procurement in England, Wales and Northern Ireland.
The Procurement Act received Royal Assent in October 2023 with most of the provisions coming into force on 24th February 2025. Secondary legislation, the “Procurement Regulations 2024” will also take effect from this date.
The Government is publishing guidance on the new requirements, available here. The purpose of this note is to provide an overview of some of the key changes. The Government is also delivering training, details of which can be found here.
What is staying the same?
- A number of concepts and requirements will be familiar to contracting authorities and suppliers. For example, the Procurement Act retains a list of “exempt contracts”, and the range of remedies available for disappointed suppliers remains broadly similar.
What is changing?
- Greater Flexibility. There are fewer procurement procedures available, however they will be less prescriptive than under the present regime. Contracting authorities can choose from “direct award”, “competitive tendering procedure”, or to “award under an existing framework”. Competitive tendering can either be an “open procedure” or “competitive flexible procedure” (“CFP”). The CFP allows for the design of a process to suit the contracting authority’s requirements as long as they comply with the general objectives set out in section 12 of the Act, various minimum time limits set out in section 54, and the procedures are a proportionate means of awarding the contract by reference to the nature, complexity and cost of the contract. A light touch regime for light touch services is retained and rules will apply to specific below threshold opportunities.
- Standstill. The mandatory standstill period is reduced from 10 to 8 days.
- Procurement lifecycle & enhanced transparency. The regime will cover the full lifecycle of the procurement – extending from pre-market engagement to eventual contract termination. Contracting authorities will need to publish various notices at the pre-procurement phase, during the procurement, and during the term of the contract. There are new obligations to report on contract performance and termination, and to have regard to procurement objectives when making contract management decisions. Contracting authorities will need to publish additional information on a central digital platform as part of the Government’s heightened transparency agenda.
- Procurement principles. The themes of non-discrimination and proportionality still feature within individual obligations, although are not explicitly identified as overarching principles. The principle of equal treatment remains, with a modified formulation.
- Change in terminology. There is a significant change in language and terminology in the new Act, which creates questions around how historic case law may be applied to the new Act.
- Contracting authorities must have regard to new procurement objectives and barriers for SME participation in respect of above threshold procurements and consider how these may be removed or reduced.
- National Procurement Policy Statement. Contracting authorities must have regard to any National Procurement Policy Statement, which will set strategic priorities for public procurement.
- Wider exclusion grounds & Debarment. There are slightly wider discretionary grounds to exclude suppliers than under the present regime as a result of a supplier’s poor contract performance or as a result of their relationship with associated suppliers and sub-contractors. Contracting authorities must notify Ministers when they exclude a supplier. Ministers may investigate and add the supplier to a central debarment list, which potentially prevents that supplier from bidding on a public procurement for a specified period of time.
Contracting authorities will need to comply with their requirements under the Procurement Act in respect of processes commenced following 24th February 2025. However, they should have regard to the new regime in advance so that it can be factored into procurement planning.
If you have any questions about the Procurement Act or need help updating your procurement policies and procedures, please contact the Stephens Scown commercial team at corporate@stephens-scown.co.uk.