In our last blog, we wrote about changes that were coming into force around procurement in 2025.
The most notable change – the introduction of The Procurement Act 2023 – came into effect this week, on Monday 24th February 2025.
This new piece of legislation marks a significant transformation in the UK’s public procurement landscape, particularly when dealing with public sector tenders.
The Procurement Act has been brought in with the aim of ‘streamlining processes’, ‘enhancing transparency’, and ‘fostering inclusivity’.
For businesses looking to win public sector contracts from now on, understanding the nuances of this Act is crucial to a successful tender bid.
So, what does it all mean?
Simplified Procurement Procedures
One of the Act’s primary objectives is to simplify procurement procedures. It consolidates existing pathways into two main processes:
- Open Procedure: A single-stage process suitable for straightforward procurements.
- Competitive Flexible Procedure: A more adaptable, multi-stage approach allowing contracting authorities to design procurement processes tailored to specific needs.
For the public sector, this flexibility encourages active engagement with a diverse range of suppliers, including small to medium-sized businesses (SMEs) and social enterprises. It enables procurement teams to collaborate closely with stakeholders – such as service users, and suppliers – to develop innovative products and services that are more aligned with the government’s wider objectives, such as moving towards more digital or environmentally-friendly solutions.
Central Digital Platform
A cornerstone of the Act is the introduction of a Central Digital Platform, enhancing the existing ‘Find a Tender’ service. This platform serves as a centralised hub where suppliers can register and access procurement opportunities across the public sector.
Key features include:
- Unified Registration: Suppliers input their core business details once, reducing repetitive administrative tasks.
- Streamlined Information Sharing: Stored information can be easily updated and shared across multiple tenders, minimising duplication and errors.
- Enhanced Transparency: All public procurement opportunities are visible, making it easier for suppliers to search for and set up alerts for tenders of interest.
For businesses targeting public sector contracts, this platform simplifies the bidding process, making it more accessible and less time-consuming. It ensures that suppliers have a clear understanding of available opportunities and the requirements for each tender.
Emphasis on Social Value
The Act places significant importance on “social value” in procurement decisions – something we have seen greater importance being placed on in recent months. This has led to our offering of the Balloon Social Value Manager tool to our clients so they can learn how to demonstrate their social value in a tender bid.
Contracting authorities are now actively encouraged to consider factors beyond cost, such as:
- Community Benefits: Initiatives that contribute positively to local communities.
- Environmental Impact: Practices that promote sustainability and reduce carbon footprints.
- Support for SMEs: Efforts to engage and collaborate with small and medium-sized enterprises.
This shift means that businesses bidding for contracts should highlight how their services or products deliver social value. Demonstrating a commitment to community engagement, our planet, and offering support for the local economy can enhance a bid’s competitiveness.
Enhanced Transparency and Accountability
Transparency is a central theme of the Procurement Act 2023. The legislation mandates:
- Publication of Procurement Notices: All opportunities above certain thresholds must be advertised on the Central Digital Platform.
- Disclosure of Contract Modifications: Any changes to contracts are to be published, ensuring stakeholders are informed of adjustments.
- Performance Monitoring: For contracts exceeding £5 million, at least three Key Performance Indicators (KPIs) must be published, with performance against these KPIs reported annually.
For suppliers, this means increased visibility into procurement processes and decisions. It allows businesses to better understand the criteria for contract awards and the performance expectations once a contract is secured.
Support for SMEs and Social Enterprises
The Act introduces measures specifically designed to reduce barriers for SMEs and social enterprises, including:
- Simplified Processes: Reducing bureaucratic hurdles to make it easier for smaller businesses to compete for contracts.
- Prompt Payment Mandate: Ensuring 30-day payment terms throughout the public sector supply chain, improving cash flow for SMEs.
- Elimination of Unnecessary Requirements: For instance, prohibiting the demand for insurance coverage before a contract is awarded, which can be a financial strain for smaller enterprises.
These provisions aim to create a more level playing field, enabling a diverse range of suppliers to contribute to public sector projects. This diversity can lead to more innovative solutions and services that better meet the needs of communities.
In summary,The Procurement Act 2023 represents a significant shift in how public sector procurement is conducted in the UK.
For businesses aiming to secure public sector contracts, understanding and adapting to these changes is vital. Embracing the new procedures, engaging with the Central Digital Platform, and emphasising social value and how – through purchasing your products and services – the government can achieve its wider goals, will really help to make any future public sector tender bids successful.
For further guidance or help with public sector tenders, contact our team today.