Understanding the Impact of the 2023 Procurement Act: From Frameworks to Fairness:

From Frameworks to Fairness: Understanding the Impact of the 2023 Procurement Act. The 2023 Procurement Act in the UK will bring about significant changes in procurement practices, with a particular focus on supporting small businesses, especially SMEs. This transformation of public procurement represents a big change for all public bodies, which between them spend £300bn per year.

What the Procurement Act aims to deliver

The Act promotes fair competition and equal opportunities, encourages innovative procurement methods, and emphasises sustainability. These changes aim to level the playing field and create more opportunities for small businesses to participate in government contracts. By staying informed and proactive, SMEs can position themselves strategically to take advantage of the opportunities presented by the 2023 Procurement Act.

Of particular interest to Granby in understanding the impact of the 2023 Procurement Act are the Government’s plans to deliver more open frameworks. And to put measures in place to remove barriers for SMEs, and introduce new dynamic markets, allowing greater flexibility all round. This is critical as SMEs are now receiving a relatively smaller amount of reported direct Government procurement spending than five years ago.

“In 2016, 25% of public sector procurement spending was awarded directly to SMEs. By 2021, this figure had dropped to 21%, indicating that only just over one in every five pounds spent by the Government on public services went straight to SMEs.” Granby News

Granby’s experience in the Public Sector

Granby, a 3PL business, can talk with some experience on this as we have been fortunate enough to have been awarded a number of public sector contracts in recent years, , including the national COVID infection survey. Granby has been awarded public sector contracts through direct award and frameworks. Frameworks are agreements between public sector buyers and suppliers that establish the terms and conditions for procurement. They streamline the procurement process and make it more efficient for both buyers and suppliers. By being appointed onto each of these frameworks, Granby has been able to access a wider range of opportunities and compete effectively with larger corporations, contributing to our success in winning public sector contracts around handling and fulfilment, contract packing, warehouse distribution and reverse logistics solutions. But our own success in winning these public sector contracts through direct award and frameworks all predate the 2023 Procurement Act.

“Suppliers already face many difficulties in being recognised as experts within their field, especially SMEs in competition with big corporates. So, for SMEs like Granby, it is really encouraging to see how the new legislation should create better opportunities.” Victoria Pittman

Understanding the Impact of the 2023 Procurement Act.

So, what are the 10 key changes? What can public sector organisations and suppliers expect to see as a result of the new Act?

Well, the good news for all involved is that we should see a cleaner, easier to understand. And fairer awarding of public sector contracts in England, Wales and Norther Ireland. Scotland has not signed up to the Act.

10 Key Changes in the 2023 Procurement Act

1 Reforms to the procurement system

The Act aims to shake up the outdated procurement system to ensure that every pound spent on public procurement goes further for communities and public services. It emphasises value for money, public benefit, transparency, and integrity.

2 Principles and objectives

The Act sets out principles and objectives that must underlie the awarding of a public contract. These include delivering value for money, maximising public benefit, transparency, integrity, and consideration of barriers facing SMEs.

3 Modernisation and unification of systems and processes

The Act seeks to modernise and unify the procurement systems and processes in the UK. It aims to make the system quicker, simpler, and more transparent while remaining compliant with international obligations.

4 Focus on value for money, competition, and objective criteria

The outputs of particular interest to SMEs looking to be awarded public sector contracts. The Act introduces a new regime based on value for money, competition, and more objective criteria in decision-making. It aims to create a much simpler and more flexible commercial system that better meets the country’s needs.

5 Opening up public procurement to SMEs and social enterprises

The Act aims to effectively open up public procurement to new entrants such as small businesses and social enterprises, allowing them to compete for and win more public contracts. This will be facilitated through the creation of a central digital platform for suppliers to register and store their details.so, a much easier onboarding process for all. Very much why this paper is entitled from frameworks to fairness.

6 Emphasis on Sustainability and Social Value

Another important aspect of the 2023 Procurement Act is the emphasis on sustainability in procurement. Government agencies are now encouraged to consider environmental and social factors when making procurement decisions. As a handling and fulfilment operation this is core to many of our tenders. This should provide small businesses that prioritise sustainability and social value projects in their operations with a competitive advantage.

7 Consolidation of procurement regulations

It makes the regulations much easier for everyone to understand. The Act consolidates the over 350 different procurement regulations into a single regime, eliminating duplication and overlap. This creates one rule book that can be used by everyone.

8 Contract management

Another element of particular interest to smaller businesses. The Act sets out steps for contract management, including rules ensuring timely payment to suppliers. It includes requirements to assess and publish information about supplier performance. This is of interest to those delivering good work, consistently.

9 Exclusions and debarment

The Act sets out circumstances inwhich a supplier may be excluded from a procurement. This may be due to serious misconduct, poor performance, or other circumstances that make the supplier unfit to bid for public contracts. It also introduces a public debarment list for serious cases of misconduct.

10 Transparency notices

The Act includes requirements to publish notices to ensure greater transparency in procurement. The Act provides for regulations that will require contracting authorities to publish these notices, resulting in more transparency and greater scrutiny.

The Procurement Act: What happens next?

Royal Assent was given on 26 October 2023, and while it hasn’t immediately altered procurement law, the Government has announced that the new law is expected to come into force in October 2024. To ensure a smooth transition, there will be a six-month implementation period starting in March next year.

The Cabinet Office has described this Act as

“…one of the largest shake-ups to procurement rules in the history of the country. While the new law aims to create a simpler and more transparent system and one that makes it easier for SMEs to win contracts, it’s undeniable that businesses will need to familiarise themselves with new terminology and procedures.”

From Frameworks to Fairness: Understanding the Impact of the 2023 Procurement Act. Ultimately, it is the laying down of regulations focused on fair competition, equal opportunities, and sustainability where this Act levels the playing field. By staying informed and proactive, SMEs can strategically position themselves to take advantage of the new opportunities presented. It will be very interesting to see how quickly changes are felt across UK business.

If you’d like to talk about any public sector opportunity or anything raised in this article do get in touch.

______________

Photo of Parliament by Claudio Divizia on Shutterstock