Public Procurement Act 2023
Services, tools and resources for suppliers and local authorities
Transforming public spend for good
The Procurement Act 2023 is a catalyst for positive change. Used in the right way, it could transform the £385bn spent annually on public services.
The aims of the new Act are to:
- Maximise public benefit
- Simplify and streamline procurement (via a Central Digital Platform)
- Open access for smaller businesses, social enterprises and charities
- Increase transparency
- Promote fair competition
- It’s an unprecedented opportunity to place social value at the heart of regional decision-making. But this potential will only be realised if everyone adapts to the new legislation.
What’s Changing?
The main changes you can expect to see in terms of social value include:
Prioritising Public Benefit
It’s no longer sufficient for Local Authorities to commission with an emphasis on the lowest price. Authorities must prioritise maximising public benefit, reinforcing the focus on social value in procurement decisions. For suppliers it means a laser focus on demonstrating value within tenders – offering the lowest price is no longer sufficient.
Transition from MEAT to MAT
The shift from Most Economically Advantageous Tender (MEAT) to Most Advantageous Tender (MAT) provides for a greater emphasis on non-economic factors, such as environmental sustainability and community benefits.
Simplified Procurement Processes
The new legislation aims to remove many of the barriers to entry for small and VCSE (Voluntary, Community and Social Enterprise) organisations. Changes include:
- duty on Local Authorities to consider SME and VCSE participation
- requirement to remove and reduce barriers to entry
- more open approach to commercial frameworks
- mandated 30-day payment term, supporting cash flow
- more level playing field should present a wealth of opportunity, opening a pool of potential new suppliers.
Increased Transparency
Authorities must centrally report key performance indicators (KPIs) for contracts worth over £5 million, with a focus on social value delivery. Many Authorities will choose to set a much lower threshold for internal reporting. Effective monitoring and reporting mechanisms are essential. Suppliers will be expected to publish their commitments transparently into the public domain.
Central Digital Platform
The Central Digital Platform supports social value by promoting transparency and accountability in public procurement. By making opportunities visible and accessible, it ensures that suppliers, including small and medium-sized enterprises (SMEs) and social enterprises, have a fair chance to bid for contracts. This inclusivity helps to create a more diverse and competitive market.
Procurement Review Panel
The Panel plays a crucial role in ensuring that social value is integrated into public procurement processes. The Panel affects both suppliers and local authorities, overseeing procurement decisions to ensure fairness, transparency, and adherence to the Act. This means that suppliers are under increased scrutiny to meet performance standards and can face exclusion for serious misconduct. Local authorities are also monitored to ensure they follow the new procurement regulations and best practices.
