The 2023 Procurement Act

In a post-Brexit Britain, where public procurement is viewed as a crucial instrument for driving both national and local economic growth, the 2023 Procurement Act stands as a key pillar of reform. For public sector stakeholders—ranging from local councils to national government bodies—the Act presents both an opportunity and a challenge. As the UK transitions away from EU procurement frameworks, this new legislation offers a more flexible, transparent, and socially conscious approach to public contracting. For stakeholders, this Act is not just another piece of legislation; it represents a fundamental shift that will influence how public funds are spent, how services are delivered, and how accountability is maintained within the procurement process. The Act’s emphasis on streamlining procedures, fostering innovation, and supporting small and medium-sized enterprises (SMEs) aligns closely with broader goals of economic recovery and resilience. However, with these changes come new responsibilities and complexities, particularly around compliance with enhanced transparency measures and the strategic use of the Competitive Flexible Procedure.

When to Expect These Changes

The implementation of the 2023 Procurement Act is imminent, with the date set for 28th October 2024. This date is critical for public sector bodies, as it marks the point when the Act’s provisions will fully come into effect. The year leading up to this date remains a transition period, during which public sector organisations must familiarise themselves with the new rules, update their procurement practices, and ensure they are prepared to comply with the new requirements.

During this transition, the UK government is releasing further secondary legislation, guidance documents, and training materials to assist public bodies and suppliers in adapting. This preparatory phase is crucial, as it allows stakeholders to align their processes with the Act’s provisions and to take advantage of the opportunities it offers, such as engaging in more innovative and flexible procurement practices. For public sector stakeholders, the countdown to October 2024 is not just about compliance but also about seizing the opportunity to innovate and enhance the value delivered through public procurement. The changes introduced by the Act, particularly the emphasis on social value and support for local economies, offer a pathway to more impactful and responsible public spending in the years to come.

Key Changes and Flexibilities

One of the Act’s most notable features is its consolidation of various procurement regimes into a single, more flexible framework. This includes the introduction of the Competitive Flexible Procedure (CFP), which grants contracting authorities the ability to design procurement processes that suit the specific needs of each contract.
This flexibility is balanced by a requirement to ensure that procurement methods are proportionate and aligned with the nature and complexity of the contracts. The CFP allows for multi-stage processes, incorporating elements such as negotiations and presentations, which can lead to more innovative and tailored procurement outcomes.

Enhanced Transparency

The Act introduces stringent transparency requirements, significantly expanding the range of notices that must be published throughout the lifecycle of a contract. These include new types of notices, such as pipeline notices and contract change notices, which ensure that suppliers and the public are kept informed about procurement activities and decisions. This increased transparency is intended to foster greater accountability and trust in public procurement, although it also adds to the administrative burden on contracting authorities.

Focus on Social Value and Local Economies

The Act places a strong emphasis on promoting social value and supporting local economies. It explicitly mandates that contracting authorities remove barriers to entry for small and medium-sized enterprises (SMEs) and ensure that tender processes are not unnecessarily burdensome. Additionally, the Act allows for local spending prioritisation, enabling councils to restrict participation in certain tenders to local businesses, thereby bolstering regional economies.

New Accountability Measures

To enhance accountability, the Act establishes a central debarment list, where suppliers found guilty of serious offences such as fraud or poor performance can be barred from future public contracts. This is complemented by a requirement to publish key performance indicators (KPIs) for high-value contracts, ensuring that suppliers’ performance is transparently monitored and reported throughout the contract term.

Implementation Challenges and Support

As the Act is rolled out, there is a recognised need for significant cultural and procedural changes within the public sector to adapt to the new regime. The Cabinet Office is leading extensive training programmes for public sector procurers, but there is concern that suppliers, particularly SMEs, may require additional support to navigate the new rules effectively. The full impact of the Act will depend on how these entities adapt to the new requirements and whether the intended benefits of increased competition and innovation are realised.

Overall, the 2023 Procurement Act is set to redefine public procurement in the UK, with a clear focus on transparency, flexibility, and support for local economies. However, its success will depend on effective implementation and the ability of both public authorities and suppliers to navigate the new landscape.