The Procurement Act 2023: What it means for your business as a supplier
The Procurement Act 2023 is set to significantly change public procurement in the UK, with its provisions coming into effect on 24 February 2025. This legislation aims to create a more streamlined, transparent, and flexible procurement process, offering significant opportunities for businesses of all sizes, especially small and medium-sized enterprises (SMEs) and social enterprises.
Key Changes Introduced by the Procurement Act 2023
The Short Guide for Suppliers highlights the following points.
Simplified Bidding Processes: The Act introduces a new 'competitive flexible' procedure, allowing for more straightforward and adaptable bidding processes. This change is designed to make it easier for suppliers to bid, negotiate, and collaborate with public sector entities.
Enhanced Transparency: A central digital platform will be established to facilitate the publication of required notices and documents, ensuring greater visibility of procurement opportunities. This platform will feature a simple registration approach, allowing suppliers to store and manage their core business information efficiently.
Improved Payment Terms: The Act strengthens provisions for prompt payment throughout the supply chain, enabling suppliers to benefit from 30-day payment terms on a broader range of public sector contracts. This measure is particularly beneficial for SMEs, enhancing their cash flow and financial stability.
Opening Opportunities for SMEs and Social Enterprises: By simplifying processes and reducing bureaucratic barriers, the Act aims to open up public procurement to new entrants, such as small businesses and social enterprises, allowing them to compete for and win more public contracts.
Greater Oversight and Accountability: The establishment of a new Procurement Review Unit (PRU) will enhance public sector procurement practices by ensuring adherence to the Act and safeguarding public procurement from suppliers deemed to pose a risk. This unit will build upon the existing Public Procurement Review Service (PPRS), providing suppliers with a platform to address concerns regarding public procurement practices and late payment issues.
Implications for Suppliers
Increased Access to Public Contracts: The streamlined processes and reduced barriers mean that businesses, particularly SMEs and social enterprises, will find it easier to access and compete for public sector contracts.
Enhanced Financial Stability: With strengthened prompt payment provisions, businesses can expect improved cash flow, making public sector contracts more financially viable.
Greater Market Transparency: The central digital platform will provide businesses with clear visibility of upcoming opportunities, allowing for better planning and engagement with public sector procurement.
Preparing for the Changes
Businesses should take proactive steps to align with the new procurement landscape:
Familiarise with the Central Digital Platform: Register and update your business information on the platform to streamline the bidding process.
Stay Informed: Keep abreast of updates from official government sources to understand the evolving procurement procedures and requirements.
Engage in Training: Participate in available training sessions to understand the nuances of the new procurement processes and how to leverage them effectively.
The Procurement Act 2023 represents a significant shift in the UK's public procurement approach, aiming to foster a more inclusive, transparent, and efficient system. By understanding and adapting to these changes, businesses can position themselves to capitalize on the new opportunities presented.
