The Procurement Act 2023 introduces a new procurement regime in the UK which will bring the rules for the procurement of public contracts, concession contracts, utilities contracts and defence and security public contracts under one Act. Once it comes into force, the Act will govern all procurements undertaken by public bodies and utilities in England, Wales and Northern Ireland. We take a look at when the Act will be implemented and the key changes to procurement.
The Act is not yet in force as law, and is reliant on future regulations that will set out more detail on how the Act will operate. Draft regulations to supplement the Act have already been consulted, and will be published in around January and February 2024.
The regulations will include detail on the light touch regime, exempt contracts, utility turnover and supply tests, intra-UK procurement, definitions of ‘Central Government Authority’ and ‘Works’ for thresholds, removing the bar on awarding for non-commercial reasons, and transparency and notice provisions. The outcome of the consultations is awaited.
There will also be a programme of learning and development for contracting authorities that will be rolled out by the Government, with knowledge drops in November 2024, followed by policy and guidance in January/February 2024. From Spring 2024 there will be self-guided e-learning, communities of practice and deep dive webinars. The intention is that following the programme of learning development, the new procurement regime will come into force in October 2024.
The Act introduces a new concept of procurement objectives which contracting authorities must have regard to when carrying out their procurements. The objectives are:
Public authorities must also treat suppliers the same (unless a difference is justified and reasonable steps are taken not to advantage/disadvantage any supplier), and have regard to barriers to SMEs and whether barriers can be removed or reduced.
The Act provides contracting authorities with greater flexibility when designing their procurement procedures. Contracting authorities can choose to adopt the following procedures:
The Act regulates the whole life cycle of a public contract from pre-procurement market engagement through to contract award and contract management and implementation. There is an emphasis on transparency, together with obligations to publish notices throughout the life cycle of contract, and a greater focus on contract management and monitoring suppliers’ performance.
The new notice requirements are extensive and will likely increase the administrative and management burden on contracting authorities. We will be examining the notice requirements at each stage of the contract life cycle in future articles.
The existing procurement regime places emphasis on best value for money, and requires contracts to be awarded to the Most Economically Advantageous Tender (MEAT). The Act alters the focus to the Most Advantageous Tender (MAT). The aim behind the change in language is to enable contracting authorities to give more weight to award criteria such as social value, and to implement the recommendations in the National Procurement Policy Statement. However, all award criteria should continue to be proportionate and related to the subject matter of the contract.
The Act significantly changes the way in which contracting authorities notify tenderers of an award decision, and carry out a standstill period as follows:
Another significant change is the introduction of a centralised debarment list of suppliers which are subject to an exclusion ground. The debarment list will be maintained and managed by central government. Contracting authorities will be required to notify central government within 30 days of excluding a supplier from a procurement process.
There will be an online platform, that replaces FTS and Contracts Finder, where all notices and documentation are published, including supplier registration and selection questionnaire information. This “tell us once” approach, aims to “reduce time taken by suppliers to access public procurement opportunities to ensure that common data can be submitted more efficiently and effectively.”
We are awaiting the publication of the Government’s consultation response on the draft regulations, together with new guidance and policy. In the meantime, contracting authorities and suppliers should sign up to the Government’s learning and development programme, and familiarise themselves with the new procedures, and review internal processes to identify what updates are required to comply with the Act, such as forms of notices.