Procurement Act comes into force

The Procurement Act 2023 has come into force today, shaking up the way more than £400bn a year is spent by public bodies on goods and services.

The legislation, which aims to create a “simpler and more transparent” system to replace European Union rules post-Brexit, introduces several measures with key implications for the construction industry.

The act establishes a single digital platform for supplier registration in a bid to enshrine objectives for public procurement including delivering value for money, maximising public benefit, treating suppliers equally and acting with integrity.

Under the new system buyers are required to have regard to the government’s National Procurement Policy Statement which sets out priorities for public procurement.

The bill also introduces new exclusion rules to tackle unacceptable behaviour and poor performance and arrangements to allow public authorities to buy “at pace” if necessary to protect life, health, public order or safety.

>>See also: ‘They were not the sort of people who could lead’: How the Gold Standard is shaking up public sector procurement

>>See also: The Procurement Bill – the key impacts for construction

The act introduces open frameworks, which unlike the closed frameworks in procurement law to date, would allow new suppliers to join after the framework has been set up. These frameworks can be for up to eight years and must be reopened during this time at least once.

Procurers are required to base their bids on the “most advantageous tenders” (MAT) rather than the previous “most economically advantageous tender” (MEAT). The aim is to encourage bids for work from firms to consider a broader view of what can be counted as value for money, including social vale.

The act also requires projects in excess of £5m to set at least three key performance indicators, which must be published in the contract details notice and then the supplier’s performance against those KPIs published at least every 12 months.