The Procurement Act – 6 months on…

The Procurement Act 2023 came into force on 24 February 2025. The Act promised to transform the way public sector procurement is carried out in the UK. So, six months into the new regime what are initial impressions of the changes brought in by the Act? 

Greater transparency: A key focus of the Act has been to improve transparency both during the procurement process and subsequently during the life of the contract. There are a number of new notices that contracting authorities are required to publish, including: 

• A pipeline notice where the authority considers that it will, in the coming financial year, pay more than £100 million under relevant contracts
• A preliminary market engagement notice where the authority wishes to carry out market engagement with supplier before procuring a contract
• KPI performance notices, setting out how the supplier is performing against KPIs
• Contract modification notices where the authority intends to modify a contract 

We are seeing more and more pipeline notices and preliminary market engagement notices being published on the central digital platform, which are very helpful in providing suppliers with advance notice of upcoming procurement activity. It remains to be seen how widely KPI performance notices and contract modification notices will be used, given we are still in the early stages of the regime. 

New procurement procedures: Contracting authorities essentially have a choice of 2 procurement procedures under the new Act – the “open” procedure which operates in a similar way as under the previous legislation, and the “competitive flexible procedure” which gives authorities greater flexibility to shape the procedure as they see fit. Perhaps unsurprisingly, in the first few months of the new regime we saw a lot of contracting authorities using the open procedure given its familiarity,  though there is evidence of increasing use of the competitive flexible procedure in the last couple of months. It remains to be seen how adventurous authorities will be in structuring these procedures, or whether they will default to structuring them in a similar way to the “restricted” and “competitive dialogue” procedures under the previous legislation 

Supplier exclusion: The Act provides updated and expanded grounds for exclusion of suppliers from procurement processes, together with the introduction of a “debarment list” of suppliers excluded for serious breaches. Of particular interest to suppliers has been the additional discretionary grounds which give an authority the right to exclude a supplier that has breached a previous public contract which resulted in contract termination, the payment of damages or a settlement agreement being entered into between the contracting parties. It remains to be seen how widely these expanded supplier exclusion grounds will be used in practice. 

Previous legislation still relevant:  It’s important for authorities and suppliers to remember that although the Act is now in force, the previous procurement legislation – the Public Contracts Regulations 2015 (PCR) – is still relevant. The PCR will continue to govern any contracts procured or in the process of being procured prior to 24 February 2025, together with the award of any contracts under pre-existing frameworks. Given that a large number of these frameworks still have several years left to run the PCR will have a role to play for some time yet. 

This article is part of our Legally FM article series, to read more from this series please click here.