The new procurement regime approaches

With the introduction of the Procurement Act 2023 little more than four months away, Clare Hardy provides an overview of the key changes coming into force

Following a flurry of recent activity relating to the implementation of the Procurement Act 2023 (The Act), including the announcement of a go-live date of 28 October 2024, the publication of regulations and guidance, and the publication of a national policy statement, the calling of a general election created some temporary uncertainty as to the impact on the new procurement legislation.

However, the Procurement Regulations 2024, which introduce details to build upon provisions in the Procurement Act were made before Parliament was dissolved. Therefore, although a change of government might mean that there will be changes to this legislation in the future, it seems likely that the Act will be brought into force. Contracting authorities should therefore continue to make preparations to ensure that they understand and are ready for the new regime.

Key provisions of the Procurement Regulations 2024 include:

• A requirement for notices to be published on a central digital platform.
• Details of the information that must be included in notices required under the Act.
• Details of the categories of services that will be regarded as ‘light touch’ services and so subject to the light touch regime.
• Disapplication of the Procurement Act 2023 to the National Health Service. This will be covered by the Health Care Services (Provider Selection Regime) Regulations 2023.
• Provisions as to how the regulations apply concerning devolved Welsh authorities and devolved Scottish authorities.

The Government has published guidance on several aspects of the Procurement Act 2023:

• The definition of contracting authority. This explains the entities that are subject to the Act and its subordinate legislation and the tests to use to determine whether an entity is within the definition.
• The definition of covered procurement: This refers to the definitions of “procurement” and “covered procurement” and provides explanation to help contracting authorities understand what procurements are above threshold non-exemption and what provisions apply to them.
• Valuation of contracts: This provides guidance on estimating contract values for the purpose of assessing if it is above the threshold for the application of the legislation, as well as explaining anti-avoidance provisions.
• Mixed procurement: This provides guidance on designating contracts that comprise a mixture of different categories of requirements.
• Exempted requirements: This guidance explains the provisions for some contract procurements to be outside the application of the legislation, including reference to exemption because of the relationship between contracting parties and exemption because of the subject matter.
• Thresholds: This sets out details of the thresholds at which the requirements of the legislation apply.
• National procurement policy statement: The Act makes provision for the Government to publish a statement to communicate to contracting authorities policy objectives relating to public procurement. Contracting authorities must have regard to such a statement when they are carrying out a procurement. This guidance provides some explanation about the duty. A national procurement policy statement has been laid before Parliament.
• Notices: Pipeline notice, planned procurement notice: These guidance notes provide guidance to contracting authorities with drafting and publishing notices required under the new procurement legislation.
• Technical specifications: This guidance explains the provisions that the Act makes relating to technical specifications to ensure that contracting authorities do not use technical specifications to limit competition unnecessarily. The guidance considers performance and functional requirements, standards, and requirements for certificates or other evidence.
• Preliminary market engagement: This provides guidance on preliminary market engagement under the Act, including reference to determining what might be considered preliminary market engagement, preparing to conduct preliminary market engagement, ensuring that contractors are not put at an unfair advantage, notices, and joint preliminary market engagement.
• Transitional and saving arrangements: This guidance provides details of the regulations that make provision for transitional and saving arrangements for procurements that are ongoing when the Act comes into force and for contracts awarded under previous legislation. The guidance says that the fundamental principle is that procurements that are commenced after the Act comes into force must be conducted by reference to the Act only and those that were commenced under previous legislation must continue to be managed under that legislation.

Actions for contracting authorities to take in preparation for the new procurement regime include:

• Ensuring that anyone involved in procurement is familiar with the requirements of the new legislation, the guidance and the national policy statement.
• Accessing and using resources aimed at helping with preparation for the new regime. The Cabinet Office’s Transforming Public Procurement team has made available considerable learning resources.
• Reviewing their constitutions, in particular contract procedure rules, to ensure that these are up to date to reflect the new legislation and how this will be applied in their authority.
• Preparing for the drafting and publication of the notices that will be required at various stages under the new regime.
• Identifying current and expected future procurement activity and establishing what will be required either under the new regime or under previous legislation in order to complete these obligations and enter into the relevant contracts

Clare Hardy is a partner at Geldards, specialising in Public Sector Law