How will the Procurement Act 2023 affect best practice?

  • 13/02/2024
  • Written by NOE CPC

With legislative changes on the horizon, it’s important to stay on top of training and ensure you and your team are following best practice and guidance ahead of the implementation of the Procurement Act 2023.

We sat down with Andrew Daly, Partner, and Head of Procurement at Hempsons LLP within their specialist procurement team. Andrew has more than 20 years experience of working with the NHS acting both for contracting authorities and bidders. In this blog we discuss current practices and how the changes will affect procurement exercises going forward.

How will the changes in the Procurement Act 2023 make it easier for public sector procurement teams to ensure they are following best practice?

This is a tricky question, and I do not see this as being a quick win.

According to Government Commercial Function, the Procurement Act will bring a range of benefits, including:

  • Creating a simpler and more flexible commercial system that better meets our country’s needs while remaining compliant with our international obligations
  • Opening up public procurement to new entrants such as small businesses and social enterprises so that they can compete for and win more public contracts
  • Taking tougher action on underperforming suppliers and excluding suppliers who pose unacceptable risks
  • Embedding transparency throughout the commercial lifecycle so that the spending of taxpayers’ money can be properly scrutinised 

If this is the aim, in order to get there, contracting authorities are going to need to adopt a new regime when procuring.

As the new system beds in, there is potential for contracting authorities (and suppliers) to struggle with the changes. At points in 2024, most health bodies will be working under three different procurement regimes depending on when their process was commenced and what their requirement is (the Public Contracts Regulations 2015; the Health Care Service (Provider Selection Regime) Regulations 2023; or the Procurement Act 2023). 

However, once the new rules are embedded, teams are trained, and documents and procedures updated, the Procurement Act 2023 should provide a simpler set of processes for contracting authorities.

 There will be a need for contracting authorities to share best practice as all of us work through the new requirements and how they will actually operate in practice. But this will not happen overnight. That is where lawyers can assist to navigate the new rules. 

What will the new Act change in terms of practice around procurement procedures? E.g. current process around frameworks and moving to open or competitive flexible procedures. 

The Procurement Act 2023 will reduce the number of procedures available. It will make frameworks more flexible. However, similar principles that apply under the PCR will continue to apply under the Act.

There will therefore need to be a decision made as to what your requirements are, which route to adopt and then the need to determine who has won, alongside notifying bidders. Therefore, there will be a need to consider the options open to you and follow the new requirements. For example, the competitive flexible procedure will need to be considered carefully. This new procedure effectively is replacing current restricted procedures or processes involving dialogue/negotiation. We will need to see how this is utilised in practice. 

It will need to be seen whether framework providers will look to move to open frameworks, or whether they will stick to more “traditional” closed frameworks. I can see that there will be different approaches across the board. 

How will the changes in terms of contract management help procurement organisations ensure best practice? 

I think it will be a case of wait and see how the changes for contract management impact. Contract management may take on a greater importance than it does for some organisations currently. Suppliers may be more concerned about their performance given the new notices that contracting authorities will be required to publish. However, as the new requirements progress, it may become apparent that more staff will be needed to deal with contract management. 

Will the new Act bring disruptions to existing practices? 

The new Act will introduce change – whether that will be seen as disruption will depend on individuals. Processes that are already underway will need to continue to comply with the PCR. New processes commenced once the Act comes into force will have to comply with the new rules. 

It will be interesting to see if contracting authorities seek to start any new process before the Act comes in (to use the tried and tested PCR), or wait until the Act comes in. 

Rather than disruption, I expect processes to take a bit longer, as the new rules bed in and we get to grips with where the pinch points are. We will all be learning as we go! 

For further support, you can contact the NOE CPC Support Desk, you can also use our Legal Services framework for access to an expert panel of legal providers like Andrew Daly.

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