10 things you need to know about the Procurement Act 2023

We know changes in legislation can be daunting, so, in conjunction with Browne Jacobson, we have summarised the key things you need to know about the Procurement Act 2023 and the steps you can take now to prepare for it.

After 28th October, you will need to procure in accordance with The Procurement Act 2023 in order to be compliant and you will have to refer to the secondary legislation (Procurement Regulations 2024) and the statutory (and other) guidance provided by the government.

The Procurement Act sets out the legal requirements and provides the detail of how these should be applied within your procurement – and crucially, the supporting documents explain the criteria against which your compliance will be measured. Together, the Act, secondary legislation and guidance documents will help you to establish the right conditions for effective competition and compliant procurement.

The introduction of the Act is designed to simplify a complex procurement regime and to deliver improvements in social value, sustainability and innovation. It will retain many underlying principals such as equal treatment, proportionality and ensuring suppliers are not advantaged or disadvantaged, but it will also place a much greater focus on transparency and acting with integrity.

The most appropriate approach for each procurement, will need to be considered, and the introduction of a new “competitive flexible” procedure will allow tenders to be designed innovatively and be geared towards achieving its desired outcomes. However, as before, this will need to be in proportion to the nature, size and complexity of the contract.

Presented as a set of objectives and principles rather than rules, the new legislation is intended to be less prescriptive than the current legislation - the PCRs and UCRs. Whilst a subjective approach will allow for greater flexibility, it could also inadvertently lead to more challenge if the rules that are set out in the procurement documents are not followed during the procurement.

There are lots of resources exploring the Act in detail, including the following from Browne Jacobson:

• The Even Lighter Touch Regime | Procurement Act | Government law
• The evolution of sub-contracting under the Procurement Act 2023 and
• Procurement Act 2023: Impact on resolving contract disputes

There are more notices, and only two are voluntary.
The notices, 13 in total, cover the full contracting lifecycle, therefore they will require more input and management from contracting authorities. This will mean increases in procurement documentation, contract management administration and data collection to populate the notices.

• The Standstill Period will be defined as 8 working days (currently 10 days).
• The Limitation Period for commencing challenges will remain at 30 days.
  

The Act replaces the PCRs and UCRs, so there will only be one procurement regime. However, there will still be sector-specific exemptions (e.g. the maximum term for a closed framework will still be eight years for utilities organisation, rather than the standard four years).

There will be fewer procedures and no default procedure

In fact, there will only be two procedures:

1. Open Procedure for single-stage tenders.
2. Competitive Flexible Procedure for any other competitive tendering process, designed to reflect the requirements of each procurement.

Under the PCRs, contract modifications are not typically advertised. However, the Act introduces a new requirement to publish a contract change notice before a modification is made to a contract, and, for modified contracts exceeding £5m, a requirement to publish a copy of the modified contract.

This will bring increased scrutiny from the market and potential challenge if the modification does not fall within one of the permissible grounds detailed in the Act. A voluntary eight-day standstill period from the date of the notice may also be observed.

These are the golden threads running through the Act, and are reflected in the requirements to provide more comprehensive feedback in Assessment Summaries to bidders and the encouragement of more effective Pre-Market Engagement processes to improve your understanding of what the market can engage with and realistically deliver.

There will be more scope for rating poor supplier performance and setting, measuring and reporting performance KPIs as well as building in how these might evolve throughout the contract. Where a contract value exceeds £5m, there will be a requirement to set at least three KPIs against which performance must be reported in an Annual Contract Performance Notice.

A new Procurement Review Unit within the Cabinet Office will monitor compliance and seek to improve best practice.

Clarity on the grounds for supplier exclusion and a single debarment list held by the government will also be included, however, remedies will still not include tribunals, which could prove to be a missed opportunity.

There will be a greater focus on pipeline visibility and on levelling the playing field for suppliers that fall below a certain threshold. Removing barriers to entry for SMEs and improving supply chain engagement through collaboration will also be a requirement.

Consideration of the Most Advantageous Tender (MAT) rather than the Most Economically Advantageous Tender (MEAT), which aims to prioritise quality, value for money and long-term socioeconomic outcomes, rather than just the lowest-priced tender.

Any contract awarded before 28 October 2024, will be subject to the PCRs until the expiration of the contract/framework, including call off contracts under frameworks and procurements that are launched before 28 October 2024.

• Familiarise yourself with the Act and the accompanying guidance
• Attend a Procurement Act knowledge drop session via www.gov.uk
• Invest in additional procurement and administrative resource
• Start using performance management KPIs to test and drive supplier performance

Smarter procurement helps drive efficiency, innovation and quality in public services, so it is important that tenders are designed effectively to achieve the best outcomes, value for money and community benefits.

The introduction of the Procurement Act 2023 is an opportunity to improve public procurement and empower you to use transparent, collaborative frameworks to achieve compliance and competitive benefits from the market.

In a dynamic and fragmented marketplace, it can be hard to know which frameworks to use, which are compliant and transparent, and which will meet or exceed your requirements throughout delivery.

SCAPE's consultancy, civil engineering, construction and utilities frameworks have achieved Gold Standard verification through Constructing Excellence, demonstrating their alignment with the Construction Playbook and procurement best practice set out by the government and endorsed by the Cabinet Office.

Our procurement processes will always be compliant, transparent and responsible and delivered in accordance with UK and Scottish procurement law.

In addition to our legal obligations as a contracting authority, we are committed to maintaining the highest level of transparency and efficiency to help you maximise the value of your procurement and achieve your strategic objectives.