The UK’s Procurement Act 2023, effective from 24 February 2025, introduces significant reforms to public sector contracting, impacting industries such as construction, healthcare, IT, transport, and professional services. The Act aims to simplify procurement, enhance transparency, and make processes more accessible, especially for SMEs.
Key Changes:
- Simplified Procurement Procedures and Early Engagement
- Streamlined Processes: Public sector buyers now have two primary methods: an open bidding process and a flexible competitive procedure, allowing for tailored approaches to procurement.
- Proactive Market Engagement: Authorities are required to publish notices about upcoming projects earlier, enabling suppliers to prepare in advance and potentially influence procurement strategies.
- Introduction of Dynamic Markets: Replacing traditional frameworks, dynamic markets permit suppliers to join at various stages, increasing accessibility to contracts.
Implications for Businesses Across Industries:
- Increased Opportunities: Early engagement allows companies to better align their offerings with public sector needs.
- Reduced Administrative Burden: Simplified procedures make it easier for SMEs to participate in public tenders.
- Implementation of the Debarment List and Supply Chain Oversight
- Debarment List Introduction: A new list will exclude companies failing to meet procurement standards from bidding on public contracts.
- Mandatory Compliance Checks: Buyers must verify that suppliers, subcontractors, and associated entities are not on the debarment list before awarding contracts.
Action Points for Businesses:
- Regular Supply Chain Audits: Ensure all partners and subcontractors comply with procurement regulations to avoid potential debarment.
- Maintain High Compliance Standards: Adherence to procurement rules is essential to remain eligible for public contracts.
- Emphasis on Value Beyond Cost in Bidding
- Holistic Evaluation Criteria: Public sector buyers will assess economic, social, and environmental value alongside cost considerations.
- Alignment with National Policies: The National Procurement Policy Statement directs buyers to prioritize economic growth, social responsibility, and SME engagement.
Implications for Businesses:
- Enhanced Bid Competitiveness: Demonstrating contributions to sustainability, community welfare, and economic development can strengthen proposals.
- Encouragement of Innovation: Solutions that offer added value beyond cost are more likely to be favored in the procurement process.
- Performance Monitoring and Key Performance Indicators (KPIs)
- Mandatory KPIs for Major Contracts: Contracts exceeding £5 million require at least three KPIs, with performance monitored annually.
- Ongoing Compliance Tracking: Authorities will assess supplier adherence to KPIs throughout the contract duration.
Action Points for Businesses:
- Focus on Performance Metrics: Meeting or exceeding KPIs is crucial for contract retention and future opportunities.
- Transparency and Consistency: Providing reliable services and clear reporting aligns with public sector expectations.
What This Means for euroloo Customers
While euroloo primarily serves the construction industry with essential site welfare services, the Procurement Act 2023’s reforms impact all sectors engaged in public contracts. To navigate this new landscape successfully:
- Engage Early: Monitor procurement notices to anticipate and prepare for upcoming opportunities.
- Ensure Comprehensive Compliance: Regularly verify that all partners and subcontractors meet the required standards.
- Highlight Added Value in Proposals: Emphasize how your services contribute to broader social, economic, and environmental goals.
- Prioritize Performance Excellence: Consistently meet or surpass established KPIs to maintain strong public sector relationships.
euroloo and ecowelfare are dedicated to supporting our customers through these changes. Staying informed and proactive is essential to securing and sustaining public sector contracts under the new Procurement Act.
