UK Procurement Updates: What’s This New UK Procurement Act All About?

Teams who bid into the public sector in the UK will likely be aware of the Procurement Act 2023. The Act is an overhaul of existing procurement legislation governing public procurement, and it intends to simplify procurement regulations. The Act has been described by the Cabinet Office as “one of the largest shake ups to procurement rules in this country’s history”.

Last month, I attended a panel discussion hosted by APMP UK, where expert panellists – including representatives of contracting authorities, small-medium enterprises (SMEs) and legal teams – discussed their views of the Act. The aim of the discussion was to give a deeper insight into the Act and its impact on the bid and proposal industry from various perspectives.

Background to the Act

Since leaving the EU, the UK has needed to develop its own legislation, breaking away from the Official Journal of the European Union (OJEU). In October of last year, the Procurement Act 2023 reached Royal Ascent, a pivotal milestone in setting out how the UK Government will be procuring goods and services in the future.

The Act will bring four different pieces of procurement legislation under one single set of regulations – the Public Contracts Regulations 2015, the Utilities Contracts Regulations 2016, the Defence and Security Public Contracts Regulations 2011, and the Concessions Contracts Regulations 2016. If your organisation followed any of these regulations, you should be aware of the new Procurement Act.

Key changes you should know about

  1. New procurement objectives

Contracting authorities will have to consider new procurement objectives, which are:

  • Delivering value for money.
  • Maximising public benefit.
  • Sharing information.
  • Acting and being seen to act with integrity.
  • Treating suppliers the same.
  • Ensuring no unfair advantage or disadvantage for any suppliers.
  • Reducing barriers for Small and Medium Enterprises (SMEs).
  1. New requirements for conflict-of-interest assessments

The Act has strengthened the requirement related to conflicts of interest, clearly setting out the need for contracting authorities to identify and mitigate actual and potential conflicts of interest throughout the process. If a conflict of interest cannot be mitigated, a supplier must be excluded from that particular procurement. Conflict-of-interest assessments will be required from contracting authorities, giving you additional confidence in the fairness of the process.

  1. New Central Digital Platform and early market engagement

This new platform will replace the existing ‘Find a Tender Service’ (FTS) and will make it easier to find and access opportunities.

The platform will provide you with a central place to provide business credentials and key business information. This means that you can upload that information once and participate in tendering opportunities more easily without having to provide the same information each time. This can reduce duplication and resources.

You can set up custom searches and receive alerts about new opportunities that match your interests – and access is free.

  1. Change from awarding to the Most Economically Advantageous Tender (MEAT), to awarding to the Most Advantageous Tender (MAT)

The change to awarding contracts based on MAT encourages contracting authorities to take into account the full scope of award criteria when making a decision. This ensures that public procurement is interested in wider value and impact, e.g. social value and sustainability, rather than just the lowest price.

  1. New emphasis on early engagement with suppliers

Contracting authorities are now encouraged to engage with suppliers earlier by reviewing upcoming requirements and publishing pipeline notices.

Larger contracting authorities with a spend of over £100 million or more per year are required to publish pipelines of their future procurements at the start of each financial year so that you have time to prepare for opportunities.

The new preliminary market engagement notice means that you will be alerted to early market engagement activities. Contracting authorities will advertise opportunities to participant in pre-market research and events, helping you to understand the requirements of the procurement and ensure that you can adequately prepare to respond to the tender.

  1. New, more flexible procurement procedures

While there were several procedures available under the previous legislation, there will now only be two procedures:

  • Open Procedure – the open, single-stage procedure, which has been retained from previous legislation.
  • Flexible Procedure – contracting authorities can now design procurement processes to best suit their market. Contracting authorities can mould their procedures on the existing restricted procedure, or add additional stages – this allows greater opportunity for negotiation and conversation with suppliers. Contracting authorities must set out their procedures clearly in advance.
  1. New open framework and dynamic market options

In addition to conventional frameworks, open frameworks have been introduced which gives the contracting authority the flexibility to appoint new suppliers to a scheme of frameworks which can run for an eight-year maximum term. You can join the framework at different stages, the frameworks may not remain closed for more than five years, and they must open at some point in the first three years, meaning you won’t be locked out of opportunities.

The Act also introduces dynamic markets – dynamic markets are a list of qualified suppliers eligible to participate in future procurements. You can apply to join these any time and there is no limit to the number of suppliers that can join. This will be particularly helpful for new entrants to the market, as these markets can be used for a wider range of goods and services. These offer increased opportunities through this flexible and agile route.

  1. New requirement for contracting authorities to send assessment summaries

Under the Act, if your bid is unsuccessful, you will receive an assessment summary that shows directly how your bid compared to the winning one. This award summary will need to explain in detail why the bid was given each score for each award criterion and why it wasn’t given the score above.

Additionally, the standstill period has changed from 10 calendar days under the previous legislation to eight working days. While this change may not seem significant, this now eliminates the potential for a situation whereby a bid team could only have five working days to issue a legal challenge in practical terms, i.e. if a contracting authority releases an award notice on a Friday afternoon.

  1. New requirement to publish key performance indicators

The Act requires contracting authorities to set and publish at least three KPIs for tenders over certain thresholds. The contracting authority must make an assessment of the supplier’s performance against theses KPIs publicly at least once every 12 months.

Thoughts from the panel

The Act and SMEs

A panellist representing the SME perspective praised the introduction of a central, single sign-on platform, especially for SMEs that only work around one specific area of government, as they believe that this will streamline the process by having everything in one place. If the SME works across multiple areas of government, however, the panellist wondered whether this would actually make things more complex and/or result in more time and resources spent by the SME.

The panel’s legal representatives were pleased at the introduction of measures to greater facilitate participation by SMEs, but questioned whether the Act goes far enough to include them across the whole procurement process.

One panellist cautioned that the Act should not be considered a ‘tickbox exercise’, emphasising that an ongoing commitment to SME inclusion is vital. They also mentioned that, because the process of challenging the way that a tender is designed remains largely the same, the disproportionate cost burden for SMEs to make a legal challenge has not been alleviated.

Performance management

With reference to the new requirement for contracting authorities to publicly assess their supplier’s performance against a set of KPIs, a panellist wondered how much information would actually be shared publicly. They assumed it would be basic, high-level KPIs, and were unsure of how much depth is expected as a result of this requirement.

One panellist went further, stating that there has been a missed opportunity for standardisation in the process of setting and publishing KPIs.

Assessment summary

The requirement for contracting authorities to issue assessment summaries was relatively well received. While it is not yet clear what exactly this summary will look like, one of the panel’s legal representatives stated that it should be very detailed and helpful for bid teams if it takes the same form as the draft.

The panellist said that, whilst it is already recommended that contracting authorities do this, it’s not widely practised, and this increased transparency will help bid and proposal teams to improve and address issues for future bids.

A panellist representing the contracting authority perspective brought up a potential issue with the wording of this section of the Act, however. The Act states that the winning bid’s information will need to be publicly available and, while this increased transparency will be helpful for unsuccessful bidders, this could present problems for the winning bidder in terms of their security and proprietary information.

While they acknowledged that proprietary information could be redacted, they worried that the additional workload and use of resources that may be required to successfully and meticulously redact information that should not be in the public domain could be very burdensome for the winning bidder.

Overarching thoughts

The panel welcomed changes such as lower barriers to entry for SMEs, additional flexibility for procurement teams and increased transparency for bidders and the public. Questions were raised, however, about how these provisions will work in practice.

One panellist questioned the claim that this new procurement legislation simplifies existing processes, pointing out that the required level of transparency “isn’t the natural state of commercial officers, so it could end up increasing their workload”.

Another panellist agreed, pointing out that notices no longer being internal documents and requiring wider publication could increase workload for commercial officers because they will need to put in additional work to ensure the documents are public-ready.

The increased flexibility for commercial officers was widely considered to be a great opportunity; however, panellists wondered whether there would be an appropriate level of training and resources available to ensure they can make good use of that flexibility.

The panel addressed the fear shared by a lot of bidders that the Act would water down existing requirements at the expense of bid teams, and stated that one of the key takeaways from the Act is that this did not really occur. There are many positives in the Act that will help bid teams significantly – particularly lauded were the new requirement for the issue of assessment summaries and the Central Digital Platform.

When asked whether the expected October 2024 ‘go live’ date was realistic, panellists were hesitant. “It’s possible,” said one of the panel’s legal representatives, adding that there are still a few stages in the process that need to be completed before they can feel confident about this date, e.g. consultation and the publication of draft text.

Overall, there was a general feeling among the panel of cautious optimism about the Act. It marks a significant shake-up to procurement in the UK, and many issues will likely not become prevalent until we are operating under its requirements officially, but there are several measures being introduced that should make life easier for bidders.

If you want to read more about the Act, you can visit the government’s Transforming Public Procurement page for resources and guidance. APMP’s UK Chapter has also been publishing breakdowns of key information, which you can find here – and is planning to host an additional event surrounding the relationship between the Act and AI in April. Stay tuned for information about this event by checking out the Chapter’s member events page.



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