What is the Procurement Act 2023?

The Procurement Act 2023, a significant update to the UK’s public procurement framework, is set to replace the existing OJEU (Official Journal of the European Union) process for public sector procurement regulations that were influenced by the European Union. Designed to streamline and modernise the procurement process, this Act aims to make it more accessible and efficient for suppliers of all sizes.

It introduces a more flexible commercial framework, reduces bureaucratic barriers, and aims to level the playing field so that smaller businesses can compete more effectively for public sector contracts. Moreover, the Act emphasises prompt payment for businesses within public sector supply chains and introduces a stronger exclusions framework to address underperforming suppliers.

When does this come into effect?

The new regime under the Procurement Act 2023 will officially go live in October 2024. The government has committed to providing at least a six-month notice period before the final implementation date, ensuring stakeholders have adequate time to prepare for the transition. Until then, the existing rules will continue to apply for contracts that are already in progress​.

Key aspects of the new Act:

  1. Consolidation of Regulations

The Act consolidates the existing regulations into a single, streamlined legal framework. This move aims to make the rules more understandable and accessible, reducing the administrative burden on both suppliers and public sector organisations.

  1. Flexibility & Innovation

By introducing more flexible procurement procedures, the Act allows public authorities to be innovative and design their own competitive procurement processes as well as negotiate better deals.

The Act has also introduced ‘open frameworks’ allowing suppliers to join frameworks at various points over the eight year term, giving suppliers more opportunities to deliver public contracts and broadening the accessible supplier landscape for authorities.

Further flexibility has been introduced as contracts can be awarded to the ‘most advantageous tender’ rather than the ‘most economically advantageous tender’ (MEAT), allowing authorities to take a wider view of what is considered to be important in the evaluation criteria.

  1. Focus on Value for Money

While this has always been an overarching priority for any public sector procurement activity, delivering value for money is now defined as an explicit obligation. Alongside maximising public benefit, acting with integrity and sharing information to allow suppliers to understand the authority’s procurement policies and decisions, these obligations emphasise the objective of the Act to make the procurement process more transparent.

  1. Transparency and Accountability

The Act introduces measures to enhance the transparency and integrity of the procurement process. This includes requirements for publishing more procurement information and stronger measures to prevent corruption and conflicts of interest and address underperformance of suppliers.

  1. Improved Access for SMEs

The Act also aims to make it easier for small and medium-sized enterprises to bid for public contracts. This is achieved through simplified procedures, reduced paperwork, and measures to encourage the division of larger contracts into smaller lots that are more manageable.

  1. Legal and Remedial Framework

The Act updates the legal and remedial framework to ensure that disputes are resolved more effectively and efficiently. This includes clarifying the rights of suppliers to challenge procurement decisions.

In summary, the Procurement Act 2023 marks a significant shift in the UK government’s approach to public sector procurement. By embracing principles traditionally associated with the private sector, including flexibility, transparency, and accountability, the Act aims to revitalise the procurement landscape.

This strategic realignment seeks to maintain the public sector’s commitment to public benefit and adherence to national policies but also to infuse it with a more competitive, innovative, and efficient ethos. The expectation is that this refreshed approach will make the public sector more appealing to both new businesses and talent, fostering a dynamic environment that mirrors the private sector’s agility and innovative spirit.

The aim of Procurement Act 2023 is to pave the way for a more competitive and high-quality provision of public services, promising new opportunities for businesses and an enhanced framework for operational excellence.

Authors: Chris Powell, Grace Maturi

John Thorpe

[email protected]

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