What Is the Procurement Act 2023?
The Procurement Act 2023 is the most comprehensive reform of UK public procurement law in over two decades. Receiving Royal Assent on 26 October 2023, it replaces the patchwork of EU-derived regulations — the Public Contracts Regulations 2015, the Utilities Contracts Regulations 2016, the Concession Contracts Regulations 2016, and the Defence and Security Public Contracts Regulations 2011 — with a single, streamlined legislative framework tailored specifically to UK needs.
The Act applies to England, Wales, and Northern Ireland (Scotland has its own procurement legislation). It governs procurement by all contracting authorities, including central government departments, local authorities, NHS bodies, schools, universities, police forces, and other public bodies, as well as utilities and concession contracts.
Why Was Reform Needed?
The previous regulations, transposed from EU directives, were widely criticised for being overly prescriptive, difficult to navigate, and poorly suited to modern procurement needs. Buyers complained of rigid procedures that prevented them from designing procurements to fit the specific requirement, while suppliers — particularly SMEs — found the system complex, bureaucratic, and difficult to access.
Post-Brexit, the UK had the legislative freedom to design a bespoke procurement regime. The government undertook extensive consultation through the 2020 Green Paper "Transforming Public Procurement," which received over 600 responses and informed the final legislation.
Key Changes from Previous Regulations
Simplified Procedures
The Act reduces the number of available procurement procedures. The previous regime offered open, restricted, competitive dialogue, competitive procedure with negotiation, and innovation partnership. The new Act retains the open procedure (single-stage, all comers) and introduces the competitive flexible procedure, which replaces all other procedures with a single, highly adaptable approach. Contracting authorities can design multi-stage processes, include negotiation rounds, and structure evaluations in whatever way best fits the procurement — provided they set out the process in advance and treat all tenderers fairly.
Covered Procurement and Thresholds
The Act introduces the concept of "covered procurement" to define which procurements fall within its scope. A procurement is covered if it exceeds the relevant threshold: currently £139,688 for goods and services (central government), £213,477 for goods and services (sub-central authorities), £5,372,609 for works, and specific thresholds for utilities, concessions, defence, and light-touch regime contracts. Below-threshold procurements are subject to lighter-touch requirements but still must comply with certain transparency obligations.
Pipeline Notices
One of the most supplier-friendly innovations is the mandatory pipeline notice. Contracting authorities with an expected annual spend above £100 million must publish a pipeline notice at least once per year, setting out their planned procurements for the coming period. This gives suppliers — especially SMEs — early visibility of upcoming opportunities, enabling them to prepare bids, build teams, and allocate resources well in advance.
Transparency Requirements
The Act dramatically expands transparency obligations. A new central digital platform consolidates all procurement notices. Contracting authorities must publish notices at key stages: planning (pipeline notices and planned procurement notices), procurement (tender notices, dynamic market notices), award (contract award notices, contract details notices), and contract management (contract change notices, contract termination notices, and key performance indicator data for contracts above £5 million).
This transparency by default approach means that for the first time, there will be comprehensive, machine-readable data available across the entire procurement lifecycle, from planning through to contract completion.
Dynamic Markets
The Act replaces Dynamic Purchasing Systems (DPS) with dynamic markets. While conceptually similar — they are open frameworks that new suppliers can join at any time — dynamic markets benefit from simplified establishment procedures and clearer rules. Contracting authorities must allow new applications at least once per year and must process applications within a reasonable time. This mechanism is particularly valuable in fast-moving sectors where supplier landscapes evolve rapidly.
The Debarment Regime
The Act introduces a centralised debarment list maintained by a new Procurement Review Unit. Suppliers can be placed on the list if they have been convicted of specified mandatory exclusion offences (such as fraud, bribery, or modern slavery) or meet discretionary exclusion grounds (such as poor past performance, tax non-compliance, or serious professional misconduct). Contracting authorities must check the list before awarding contracts, and debarred suppliers cannot be awarded covered contracts for the duration of their debarment.
The regime includes procedural safeguards: suppliers are notified before being placed on the list and can make representations. Debarment decisions can be challenged through the courts.
SME Provisions
The Act contains several provisions designed to improve access for small and medium-sized enterprises. The 30-day payment requirement applies throughout the supply chain, meaning main contractors must pay subcontractors within 30 days of receiving a valid invoice. Pipeline notices give SMEs early visibility of opportunities. The competitive flexible procedure allows buyers to design lighter-touch processes for simpler requirements. The Act also limits the use of turnover-based financial capacity tests, preventing authorities from requiring disproportionate turnover thresholds that exclude capable smaller suppliers.
Additionally, the Act requires contracting authorities to have regard to the importance of SME participation and the barriers they face, embedding a cultural shift beyond mere compliance.
New Rules on Modifications and Termination
The Act clarifies when contracts can be modified after award without triggering a new procurement. Permitted modifications include those below a de minimis threshold, those anticipated in the original contract terms, and those necessitated by unforeseen circumstances — provided the modification does not fundamentally alter the nature of the contract or exceed 50% of the original value. All modifications above threshold must be published through a contract change notice, enhancing transparency.
The Act also introduces specific termination provisions, requiring contracting authorities to consider termination where grounds for exclusion arise during contract performance.
Remedies and Challenges
The Act reforms the remedies regime. Suppliers can challenge procurement decisions through the Technology and Construction Court (TCC). The automatic suspension triggered by a legal challenge remains in place, preventing contract award while the challenge is heard. However, the Act introduces a new pre-award assessment process and standstill period that aims to resolve disputes before they escalate to litigation. Courts can award damages, set aside contracts, or impose other remedies as appropriate.
Implementation Timeline
The Act received Royal Assent in October 2023, with a phased implementation period. The Cabinet Office developed extensive guidance, training materials, and knowledge drops to support both buyers and suppliers in preparing for the transition. The central digital platform was developed to support the new transparency requirements, and contracting authorities were given time to update their internal processes and train their procurement teams.
Suppliers should ensure they understand the new regime, update their procurement monitoring to capture the new notice types, and take advantage of pipeline notices to identify opportunities earlier than was previously possible.
What This Means for Suppliers
The Procurement Act 2023 represents a significant opportunity for suppliers, particularly SMEs. Greater transparency means better market intelligence. Pipeline notices enable earlier preparation. The competitive flexible procedure means procurements can be better designed, potentially reducing the burden of overly prescriptive processes. Faster payment requirements improve cash flow throughout the supply chain. And the debarment regime helps level the playing field by excluding bad actors.
Suppliers who invest time in understanding the new regime, engage early with pipeline notices, and build strong track records under the new transparency framework will be well-positioned to succeed in the reformed UK procurement market.