Procurement Essentials is a series of articles to help you overcome common hurdles, understand key concepts, and make your life as a buyer of everyday goods and services easier.
The Procurement Act 2023 is about to revolutionise the regulations that govern how the public sector spends money, and you can start getting prepared now.
What is the Procurement Act 2023?
The Procurement Act 2023 is bringing significant changes to the regulations that govern UK procurement.
Each year the public sector spends around £300 billion on public procurement. This includes spend on:
- goods: such as office equipment or hospital beds
- works: the building and maintenance of roads, schools, and major infrastructure projects
- services: adult social care, waste management, and technology services
On 26 October 2023 the landmark Procurement Bill was granted Royal Assent and became the Procurement Act 2023. The Procurement Regulations 2024 were then laid in Parliament on 25 March 2024. This statutory instrument (SI), which is a form of secondary legislation, applies a broad range of powers within the Procurement Act 2023 and provides additional detail about various aspects of the new procurement regime.
This all means the regulations that govern how that money is spent in the UK are about to change.
The Cabinet Office is leading a readiness programme based on the incoming regulations called Transforming Public Procurement (TPP). To find more detailed information on how to prepare for the implementation of the regime, visit the Cabinet Office Transforming Public Procurement webpage.
What does the Procurement Act 2023 mean?
When the UK left the European Union in 2020, the government wanted to create a simpler, more flexible, commercial system that better meets our country's needs while remaining compliant with our international obligations.
This has resulted in the development of the Procurement Act 2023, a new law that creates a new and improved set of regulations.
The new law provides a number of benefits to suppliers and buyers, including:
- cutting red tape and supporting innovation
- improving transparency by creating a fully open and transparent system, meaning everyone has access to public procurement data
- faster competition processes for emergency buying, allowing buyers to meet urgent needs quickly and efficiently
- simplifying the process of working with the public sector, supporting more SMEs to bid for contracts
When will the regulations change?
The Procurement Act 2023 has already been given Royal Assent, meaning it is a law. The secondary legislation was laid in March 2024. However, the changes to the procurement regime have not yet taken effect.
In March 2024 the Procurement Regulations 2024 were laid in Parliament to bring some elements of the Bill and the wider regime into effect. This statutory instrument (SI), a form of secondary legislation, is available to view.
It is currently anticipated that the new regulations will then take effect in full in October 2024. The Cabinet Office will issue notice of the ‘go-live' date for the new regulations at least 6 months in advance.
Remaining compliant with the right regulations
Once the Procurement Regulations 2024 have commenced, or are ‘live', these new regulations will apply to all agreements created after that time. From then on, all activity carried out under new agreements must comply with it.
However, the new regulations are not retroactive. The Public Contracts Regulations (PCR) 2015, which previously governed procurement activity in the UK, will continue to apply to any CCS agreements created prior to the ‘go live' of the new regime.
Suppliers and buyers who carry out contracts under existing agreements must ensure they remain compliant with PCR 2015, even after the new regulations come into force.
This means that if a contract is awarded through any commercial agreement that was created before the Procurement Regulations 2024 come into force and is compliant under PCR 2015, that compliance will not change until the contract expires or is replaced.
As a buyer, you will need to consider which contracts you have that will expire after the new regulations come in, and start to plan if and how you will reprocure those contracts as early as possible.
CCS has created an updated list of key commercial agreements that are anticipated to be awarded under the new regime.
How to prepare yourself as a public sector buyer
Review your business
It is important to prepare for the new regulations as early as possible. This will help ensure you are ready to start getting the most benefit from the changes when they take effect.
CCS has broken the process of preparing for the new regulations down into 5 distinct workstreams that you can use to examine your organisation's readiness and what you need to do:
- Commercial activity: review all current and planned commercial opportunities
- Standard operating procedures and policies: ensure they are robust and future-proofed for the new regime
- Guidance and information: review the documents that your teams and suppliers use and ensure they are current
- Systems: consider the readiness of your organisation's systems and what changes may be needed
- People: ensure your people understand Transforming Public Procurement and undertake the necessary training
Early preparation and training is key
Have you ensured that your people are ready and prepared for the new regulations?
The Cabinet Office is leading the TPP programme and has already launched its first official training product in the form of Transforming Public Procurement Knowledge Drops.
These Knowledge Drops are aimed at anybody who interacts regularly with procurement. They provide a high-level overview of the changes the new regulations will bring, delivered through a series of short on-demand broadcast presentations, with different versions available for buyers and suppliers. A third adaptation of the Knowledge Drops, aimed specifically at small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs), is also available.
These can be rolled out immediately to those who need to understand the coming changes, so considering how to deliver these across your organisations can help you get on top of the transition more quickly.
More detailed and specific training options are available for buyers who require more than a general overview of the new regime. Visit the Cabinet Office Transforming Public Procurement webpage to find out more about these and to get new information and resources as they become available.
How CCS can help you prepare for the new regulations
We are working closely with the Cabinet Office to understand the new regulations to ensure public sector organisations can take advantage of the benefits through our commercial agreements as soon as the new regulations come into effect.
We have already established a dedicated project team that will continuously implement our internal changes until the new regime goes live.
As an organisation we will:
- manage and implement Transforming Public Procurement as a key project for CCS, with dedicated internal staff working on this full time
- support buyers with implementing the new regime through thought leadership and guidance
- provide guidance to buyers on how to use our products once the new regulations are live
You can also download our full guide on preparing your organisation for TPP.
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