Podcast: The Procurement Act 2023

In his latest podcast, head of procurement, Andrew Daly, gives an update on the introduction of the Procurement Act 2023 and what organisations can expect when it comes into force on Monday 24 February 2025.

Listen to the episode below:

Episode transcript

Introduction

With the go live of the Procurement Act 2023 just around the corner, I thought it’d be helpful to provide a quick update as to what the current position is and what you need to be getting ready for. So thank you for joining me. I am Andrew Daly, I’m a partner and I head up the procurement team at Hempsons LLP, and as I think many of you will have heard me say before, this is the biggest change in procurement that I’ve seen in my career, which has been the last 22 years.

We have the Procurement Act and the go live date of the 24th of February, which really is not very far away now. And therefore what I want to do is just look at what is actually going to happen in practice. And I think that’s the big myth at the minute that, is your day going to be any different on the morning of the 24th of February as it was on the end of Friday the 21st of February? And I think for the vast majority of those listening to this podcast, the answer is no. That is because the transitional provisions that deal with the Procurement Act say that anything that was commenced before the Act came into force remain under the Public Contracts Regulations 2015 and only for processes commenced after the 24th of February will the Procurement Act be of impact.

The NHS primarily awards contracts as call offs from framework agreements. The transitional provisions say that the framework agreements will remain in force and any call offs under those frameworks will remain under the public contracts regulations. It is also the case that any contract modifications for a contract awarded before the Act came in or a process being commenced before the Act came in will remain under the Public Contracts Regulations. Therefore, unless you are starting a process to award a new contract under the Procurement Act after the 24th of February, in practice, what you were doing on the 21st will be what you are doing on the 24th.

There are, of course, big changes coming under the Procurement Act, and that is something that everyone will have to get to grips with, but only when you are commencing a process under the Act. And this, I think, is where a number of the potential problems arise for the NHS. The NHS, unlike the wider public sector, has three regimes that will be applying, rather than everyone else having to deal with two. That is because you’ll have the Procurement Act 2023, you’ll have the Public Contracts Regulations 2015, and you’ll have the Provider Selection Regime 2023.

And knowing which regime applies, and knowing the specific requirements of that, regime are going to be particularly important. One of the potential problems here is that the regimes are all similar but very different at the same time. So, for example, they all have standstill periods, yet the standstill periods are different lengths and are calculated differently depending on which regime you are in. Having said that, the Procurement Act will not have this big bang effect on the 24th of February, it is important to be aware of what is coming down the line. And what we will be doing is a number of specific podcasts on specific issues that are going to arise. But at this stage, it’s worth just highlighting the broad position.

What is the Procurement Act 2023?

And to start off with, we just go back to basics. The Procurement Act is the legislation that will apply for processes commenced after the 24th of February. The Act is where all of the Public Contracts Regulations, the defence regs, the utilities regs, the concessions regs, now are. But, keep an eye out for the snappily named Procurement Act 2023 (Consequential and Other Amendments) Regulations 2025. When they receive approval from Parliament, which it is expected that they will, those Consequential and Other Amendment Regulations already make changes to the Procurement Act as it received Royal Assent. Those same regulations also change the Procurement Regulations 2024, and therefore, if you are looking at the most up to date position, there’s a need to take into account those changes brought into effect by those Consequential Amendment Regulations, rather than just looking at the original legislation. And this is going to be, I think, one of the challenges that people face. Obviously, you should be making sure that you are looking at the most up to date legislation at all times, but with things changing, there’s a need to make sure that that is definitely something on your radar.

And speaking of change, it’s also worth noting that the guidance that has been published by the centre is also being changed. If you look, for example, at the Valuation of Contracts guidance, that was amended twice in January, 2025 on its own. So, there is a necessity to ensure that you are looking at the most up to date guidance when you are looking at your processes going forward. And the National Procurement Policy Statement at the time of recording this podcast has not been laid before Parliament, and therefore we’ll have to see what impact that has.

I think as everyone is well aware, under the Procurement Act, there is more guidance and documentation out there than there has ever been for anything in relation to procurement. Now, that should hopefully be helpful, but there is an extent to which there is, in a way, too much information out there. People will have done their training, they will have done their deep dives if they’re super users, etc. and therefore there is a great deal of knowledge as to what is expected to happen under the Act. I think as everyone will be well aware, until you actually use the Act in anger for the first time, whether or not the issues that you expect to come up will be the ones that do, or new issues will arise, we’ll have to wait and see.

And in the spirit of there being significant amount of documentation out for you to use, there has been various standard documents that have been published. These are on the Procurement Pathway. So, for example, there are standard templates for assessment summaries, direct award justification reports, pre procurement checklists, conflict of interest declarations and assessments, sourcing strategies and a draft competitive flexible procurement pack. So, this is for the competitive flexible procedure; it is a standard template that you would may want to use as your documentation. However, that has a number of headings with a lot of blank spaces under those headings, and whilst it is associated with guidance, it is clear that these templates are just that, they need a lot of work. They also are being updated on a regular basis as well. So to continue with the theme, it’s making sure you’re looking at the most up to date version, and clearly, as the Procurement Act beds in, there will be a need to see how things develop, how people are doing things, and therefore the documents may well change.

For those of you involved in NHS procurement, NHS England has worked up some standard templates. There’s a number of procedures that have been set out, so unlike the Procurement Pathway, there is an open procedure template and we have been assisting NHS England in the production of those templates, which are available to access on the NHS Futures website. These are all documents that will need to be considered carefully and I think my big tip is to take time to look at what is required under the Procurement Act and consider how that will impact your specific procurement. I know there is a great deal of sharing of information and working across areas to try and work documents up together and not reinvent the wheel, but with the new legislation coming in, there’ll be a need to make sure that you are aware of what the position is and what your expectations are for your own documentation.

And then, really, to highlight something that I think everyone is well aware of, the devil in the detail of the Procurement Act. It’s all very well having the guidance saying that the position is the same as it was under the Public Contracts Regulations, but until you actually start looking at the detailed provisions of the Procurement Act and the Procurement Regulations, you’ll see that there are some slight nuances that perhaps are not receiving the attention that you might expect. The example I’ve been using on a regular basis is the standstill period. The standstill period being eight working days, but the simple fact is what is the definition of a working day? Well, the definition of a working day under the Procurement Act excludes any bank holiday in any part of the United Kingdom. So, there is a need for people to know when St. Andrew’s Day is, St. Patrick’s Day is, the bank holiday for the Battle of the Boyne in Northern Ireland, for example, and take that into account when calculating your standstill period.

There’s also a need to realise that depending on which regime you’re in, the standstill period will end up being calculated differently. Of course, under the Public Contracts Regulations, it is commenced with the publication of a debrief letter and it is then 10 calendar days. Under the PSR, a notice is published. It is eight working days, but you don’t count the day after you’ve published the notice, as one of those working days. And then under the Procurement Act, it is eight working days, taking into account the position on bank holidays and making sure that you are starting the day after. They, of course, are minimum periods.

Now, there is a lot we could talk about in terms of the Procurement Act and what it will mean, but that will be for future sessions. For the simple reason, as I said at the beginning, that unless you are starting a new process at the end of February or start of March, this is something that will arise over the course of 2025 and 2026. We know there are organisations out there who are chomping at the bit to start under the Procurement Act. There are others who are trying to start their processes under the public contracts regulations to delay the changes coming in.

So, just really to reiterate the key going forward for all organisations will be to ensure that you are aware of which regime applies. Will it be the Procurement Act? Will it be the Public Contracts Regulations? Will it be the Provider Selection Regime? And I’ll be doing a separate podcast on the implications of the Procurement Act for the Provider Selection Regime, if you’d like to join me to look at that. Without wanting to spoil it, there aren’t many, but there are some key issues to consider.

And if you would like to know more about some of the issues that we’re talking about and look at some of the issues in more detail, we are currently doing a 90 minute free webinar on the 13th of February. More details are available on our website. So we’ll be of course spending more time looking at some of the issues, what it means in practice, for example; your ability to make direct awards; calling off frameworks; establishing frameworks and running processes; varying contracts; and looking at levels of debrief.

So thank you for joining me for this brief update podcast, and we will be producing more podcasts over the course of this year. Thank you.

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If you need any legal help, have any questions, or would like to discuss any of the issues covered in this update, we would be delighted to hear from you.