What changes can I expect in Bidding for 2024?
The UK Procurement Act 2023 has been introduced to reform the UK’s public procurement regime, making it quicker, simpler, more transparent and better able to meet the UK’s needs while remaining compliant with international obligations¹. The new regime will be based on value for money, competition and objective criteria in decision-making². The Procurement Bill, which will reform the existing Procurement Rules, has now received Royal Assent¹. The new Procurement Act can be viewed on the UK legislation website¹. The Act includes changes to both the mandatory and discretionary exclusion grounds, and the introduction of a debarment register which will list companies excluded for serious breaches³. The new procurement regime will open up public procurement to new entrants such as small businesses and social enterprises so that they can compete for and win more public contracts¹. The existing legislation will apply until the new regime goes live, and will also continue to apply to procurements started under the old rules¹. The government has indicated that the Act will go live from October 2024, with a six month notice period in advance of the final date¹. The Transforming Public Procurement programme aims to improve the way public procurement is regulated in order to create a simpler and more flexible, commercial system that better meets our country’s needs while remaining compliant with our international obligations¹.
(1) Transforming Public Procurement – GOV.UK. https://www.gov.uk/government/collections/transforming-public-procurement.
(2) The Procurement Act – a summary guide to the provisions – GOV.UK. https://www.gov.uk/government/publications/the-procurement-bill-summary-guide-to-the-provisions/the-procurement-bill-a-summary-guide-to-the-provisions.
(3) The Procurement Act 2023 | Womble Bond Dickinson. https://www.womblebonddickinson.com/uk/insights/news/procurement-act-2023.
(4) Public Procurement Act 2023: When will it be implemented & what are the …. https://www.ashfords.co.uk/insights/articles/public-procurement-act-2023-when-will-it-be-implemented-what-are-the-key-changes.
(5) Procurement Act 2023: key changes to the public procurement regime. https://www.shlegal.com/insights/procurement-act-2023-key-changes-to-the-public-procurement-regime.
What changes will SME businesses notice?
The UK Procurement Act 2023 aims to make public procurement quicker, simpler, more transparent, and better able to meet the UK’s needs while remaining compliant with international obligations¹. The new regime will be based on value for money, competition, and objective criteria in decision-making². The Act includes changes that will benefit small and medium-sized enterprises (SMEs) by opening up public procurement to new entrants such as SMEs and social enterprises so that they can compete for and win more public contracts¹. The new procurement regime will also streamline bidding processes, remove barriers for SMEs, and drive better value for money¹. Measures include requiring procurement entities to proactively evaluate and mitigate SME-specific challenges throughout the procurement lifecycle. For example, the Act allows SMEs to show proof of required insurance only upon contract award rather than during bidding. This spares SMEs from carrying unnecessary costs pre-award when outcomes are uncertain. Additionally, the Act mandates smaller, more tailored contract lots and enables direct price negotiations between procurers and suppliers. In principle, this flexibility caters better to SME capabilities versus rigid tendering processes¹. While many provisions target SMEs explicitly, some apply more broadly. For instance, the Act proposes to the exclusion of any suppliers due to past poor performance, modern slavery violations, and professional misconduct. This intends to level the playing field across all suppliers¹. With the new procurement regime, SMEs will have a greater opportunity to secure a share of the £300bn of expenditure³. The full implementation of the new regime is expected in October 2024 after a transition period¹.
(1) Assessing the Procurement Act 2023: What’s in Store for UK SMEs?. https://spendnetwork.com/blog/assessing-the-procurement-act-2023-whats-in-store-for-uk-smes.
(2) Procurement Act 2023: key changes to the public procurement regime. https://www.shlegal.com/insights/procurement-act-2023-key-changes-to-the-public-procurement-regime.
(3) Small businesses to benefit from one of the largest shake ups … – GOV.UK. https://www.gov.uk/government/news/small-businesses-to-benefit-from-one-of-the-largest-shake-ups-to-procurement-regulations-in-uk-history.
What should construction companies consider?
Construction companies should consider the following changes to the UK Procurement Act 2023:
– The new procurement regime will open up public procurement to new entrants such as small businesses and social enterprises so that they can compete for and win more public contracts¹.
– The new procurement regime will streamline bidding processes, remove barriers for SMEs, and drive better value for money¹.
– Procurement entities will be required to proactively evaluate and mitigate SME-specific challenges throughout the procurement lifecycle. For example, the Act allows SMEs to show proof of required insurance only upon contract award rather than during bidding. This spares SMEs from carrying unnecessary costs pre-award when outcomes are uncertain¹.
– The Act mandates smaller, more tailored contract lots and enables direct price negotiations between procurers and suppliers. In principle, this flexibility caters better to SME capabilities versus rigid tendering processes¹.
– The Act proposes to the exclusion of any suppliers due to past poor performance, modern slavery violations, and professional misconduct. This intends to level the playing field across all suppliers¹.
These changes will benefit small and medium-sized enterprises (SMEs) by opening up public procurement to new entrants such as SMEs and social enterprises so that they can compete for and win more public contracts¹. With the new procurement regime, SMEs will have a greater opportunity to secure a share of the £300bn of expenditure³. The full implementation of the new regime is expected in October 2024 after a transition period¹.
(1) The Procurement Act 2023: A short guide for suppliers (HTML). https://www.gov.uk/government/publications/procurement-act-2023-short-guides/the-procurement-act-2023-a-short-guide-for-suppliers-html.
(2) Procurement, competition and subsidy control in UK construction in 2024. https://www.pinsentmasons.com/out-law/analysis/competition-procurement-subsidy-control-uk-construction-2024.
(3) Procurement Act 2023: short guides – GOV.UK. https://www.gov.uk/government/publications/procurement-act-2023-short-guides?fhch=879884cae1172414717ee7196bf3e4d1.
(4) Procurement Act 2023: key changes to the public procurement regime. https://www.shlegal.com/insights/procurement-act-2023-key-changes-to-the-public-procurement-regime.
Source: Conversation with Bing, 09/01/2024