Government Acquisition Guidelines | UK Regulatory Perspective May 2023
The Procurement Act 2023, which came into force on 24 February 2025, marks a significant shift in public procurement regulations across the UK. Replacing EU-based procurement rules post-Brexit, the new regulatory framework aims to promote transparency, fairness, and social value in public procurement.
One of the key features of the Act is the introduction of significant transparency obligations. Contracts exceeding £5 million must be published, with only justified redactions allowed, and annual performance reviews through key performance indicators (KPIs) are now mandatory.
To provide fairer opportunities, particularly for small and medium-sized enterprises (SMEs), a central digital platform and simplified tendering processes have been introduced. This includes enabling public bodies to reserve contracts specifically for local SMEs and mandating SME spend targets.
Supplier accountability has also been enhanced via a public debarment list and stricter exclusion grounds. New mandatory exclusions of suppliers with deliberate tax penalties have been implemented, and a self-cleaning process has been incorporated into exclusion criteria.
Tabled amendments and ongoing proposals include requiring contracting authorities to factor in bidders' contributions to jobs, opportunities, and skills in award criteria for contracts over £5 million, with a minimum weighting of 10%. A standardized social value assessment approach has also been proposed, with a 10% weighting on social value for such contracts.
Public interest obligations for outsourcing or insourcing public services have been proposed, including conducting and publishing public interest tests to determine whether insourcing or outsourcing should be pursued, particularly considering national economic security and local job quality.
The UK government consultation, open until 5 September 2025, also proposes giving ministers powers to designate certain goods, services, or works as critical to national economic security, allowing exceptions to procurement law rules to protect these sectors.
The Act mandates 30-day payment terms for undisputed invoices, and suppliers who cannot demonstrate prompt payments may be excluded from contracts over £5 million.
The transition to the new regime is ongoing through 2025, with procurements started under the old rules continuing accordingly.
In addition, PPN 02/23 guidance regarding tackling modern slavery has been updated, providing information on how contracting authorities may assess bidder's compliance with provisions of section 54 of the Modern Slavery Act.
The Procurement Act 2023 delivers broad reforms to enhance transparency, fairness, SME engagement, supplier accountability, and social value in public procurement, with continued government focus on public interest obligations and national economic security in outsourcing decisions.
- In line with the Procurement Act 2023, policy-and-legislation changes have imposed stricter rules for public procurement in the industry, particularly focusing on transparency, fairness, and social value.
- The Act has mandated the publication of contracts exceeding £5 million, aiming to promote transparency in public business, while new measures also address supplier accountability.
- Within the new policy, politics plays a crucial role as the UK government has proposed powers to designate certain goods, services, or works as critical to national economic security, influencing outsourcing decisions and adjusting procurement law accordingly.
