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Procurement Act 2023

Writer's picture: Bid EssentialsBid Essentials

Updated: Oct 11, 2024

The New Procurement Act 2023 (going live in February 2025) will change public procurement to better use public resources and boost the economy. Current rules will still apply to existing contracts and ongoing procurements, but new rules will take effect for procurements after February 2025. These changes aim to create a more competitive, transparent, and innovative procurement environment, requiring suppliers to adapt and improve their offerings.


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Key points for Suppliers

  • Streamlined Processes: With an annual public procurement spend of around £300bn, the new reforms aim to make procurement more transparent and efficient

  • SME Engagement: There is a strong focus on early engagement with SMEs and flexible supply chains

  • SME Spending Target: One-third of procurement spending will be aimed at SMEs, with SME Champions and panels in central departments and SME Action Plans to promote innovation

  • Open Frameworks: New suppliers will be able to join frameworks over an eight-year term, promoting competition and technology

  • Pipeline Publication: Larger authorities will need to publish their procurement pipelines

  • Tender Evaluation: The criteria will shift from MEAT (Most Economically Advantageous Tender) to MAT (Most Advantageous Tender), considering creativity, social value, job creation, and environmental care

  • Proposal Transparency: Winning proposals will be shared (with some confidentiality), and contract KPIs will be published. Additionally, a debarment list for unfit suppliers will be created

  • Central Digital Platform: A platform for supplier registration and maintenance will be launched to reduce paperwork

  • Shorter Payment Terms: Supplier payment terms will be reduced to 30 days by April 2026

  • Simplified Procedures: Procurement procedures will be limited to Open and Competitive Flexible Procedures to encourage negotiation and innovation

  • Provider Selection Regime (PSR) for Healthcare Procurement: A new procurement process for healthcare services will be introduced

Impact on Suppliers

  • Increased Competition: More suppliers will be able join frameworks throughout the term

  • Higher Standards: Transparency and accountability will lead to higher standards with published pipelines and KPIs, so strong and transparent performance metrics are essential

  • Adaptation to MAT Criteria: Suppliers should familiarise themselves with the new MAT criteria and tailor their proposals and strategies accordingly

  • Collaboration with SMEs: More opportunities for SMEs to collaborate and build partnerships with larger suppliers

  • Administrative Efficiency: Streamlined registration and maintenance through the Central Digital Platform will increase efficiency

  • Improved Cash Flow: Shorter payment terms by April 2026 aim to improve cash flow

  • Innovation: Suppliers should develop and showcase innovative solutions to remain competitive

  • Alignment with New Strategies: Suppliers should align their internal plans with new procurement strategies by developing an action plan for best practice



Further information can be found here:

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