Introduction

We deliver the latest updates on the UK’s new Procurement Act and how it may affect your business.

On the 26th of October 2023, the Procurement Bill received Royal Assent and is now referred to as the Procurement Act 2023 (the Act).

The existing legislation will apply until the new regime goes live (experts expect this to happen in October 2024), and will also continue to apply to procurements started under the old rules.

This guide breaks down what we know about the new Act, when it will go live, and how it will impact UK businesses. In particular, businesses who supply services to the public sector.

What Is The Procurement Act 2023?

The Procurement Act 2023 will replace the existing legislation in the UK surrounding public contracts procurement. Namely, the Public Contracts Regulations 2015 and the Concessions Contracts Regulations 2016. 

The Act will govern how contracting authorities like NHS Trusts, central government departments, Integrated Care Boards, and registered local authorities procure goods and services in the UK.

The new Act offers a more flexible, transparent, and streamlined system, with more focus on social value and removing entry barriers for small businesses and social enterprises.

A key feature of the Social Partnership and Public Procurement (Wales) Act is the socially responsible procurement duty. This requires contracting authorities to prioritise social, environmental, cultural, and economic well-being in all procurement activity. 

As such, this could spell good news for small businesses and social enterprises looking to participate in the bids for public contracts.

What Happens Next?

There’s still much to be done before the new Act comes into force next year. The next step will be to finalise the secondary legislation, which lays out relevant formal definitions and notices.

This step is currently underway and going through a consultation process. Experts expect draft statutory instruments to be presented before parliament in early 2024.

Once this step is finalised, there will be a six-month “lead-in period” during which the Act will come into force. 

We can expect to see a government training programme along with guides and a brochure before the end of 2023. Indeed, the government will release “knowledge drops” about the Act in December 2023.

If you work in Procurement or may be affected by the Act, be sure to sign up to the “Transforming Public Procurement” webpages on www.gov.uk.

When Will New Procurement Thresholds Begin?

Under the Act, new procurement thresholds have already been issued. These will apply as of the 1st of January 2024.

In addition, the current procurement thresholds under the Public Contracts Regulations 2015 and the Concession Contracts Regulations 2016 will undergo review every two years.

The new thresholds will apply to any procurements that commence on or after the 1st of January 2024 (procurements that commenced before this date won’t be affected).

It’s imperative that contracting authorities update their current policies and procedures before this date to ensure they reflect these new thresholds. Additionally, if you provide services to contracting authorities ensure that they take the new thresholds into account when calculating contract values for future procurement projects.

Note: The threshold for services that fall under the “light touch regime: and for small lots remain the same.

Can I Still Make A Late Payment Compensation Claim?

Good news if you’re in the process of or you’re considering making a late payment compensation claim. These developments on the Procurement Act 2023 won’t affect your claim.

This means that if you’re a business that provides goods or services to the public sector and you’ve received late payment, you can still claim compensation. Browse our comprehensive guide to learn what constitutes a late payment.

Not sure how to navigate the claims process? We can help.

latepaymentaction.com is the UK’s leading public late payment specialistsOur experienced team works on your behalf to make a late payment compensation claim and ensure the best possible outcome

Navigating the claim process for late payment compensation can be complex. That’s why we’ve created a simple, four-step claims process:

  • Step 1: The first step is to check if you’re eligible to make a claim. Try our free Eligibility Checker today to discover if you’re entitled to claim compensation against the public sector.
  • Step 2: Start the claim process by clicking on our Make a Claim page. In less than two minutes, your claim will be underway.
  • Step 3: Complete the electronic Claim Pack (we’ll send it to you via email).
  • Step 4: Our claims specialist will proceed with your claim, working tirelessly to get you the best possible outcome and keeping your updated with regular progress reports.

For more information on how our simple four-step claims process works, explore our FAQ section.

Next Steps

We’re in the midst of change, with more updates due in early 2024. Therefore, it’s essential that contracting authorities and businesses providing services to the public sector stay vigilant. Keeping up with the latest news about the new Procurement Act 2023 will ensure you’re complying with new regulations and benefitting from the newly applied thresholds

Check our Insights Hub for the latest updates on the Procurement Act 2023 and news on late payment compensation legislation in the UK.

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