The provisions of the Procurement Act 2023 are finally coming. After almost 18 months, the Procurement Act 2023 will be in force from 24 February 2025. This means that the rules governing how public authorities purchase goods and services will be changing. Historically, procurement in England has been slightly disjointed, with separate legislation for energy contracts, concessions and public contracts. These distinct regimes will be replaced by a more uniform set of rules, designed to simplify the procurement process for suppliers and purchasing authorities alike. However, for local authorities, these changes may not necessarily feel like a simplification.
One of the key changes will be the enhanced payment terms for suppliers. For a broad number of contracts, suppliers will be entitled to receive payment within 30 days. It will therefore be important that local authorities have both contractual and policy procedures in place to manage this change.
The introduction of the ‘Most Advantageous Tender’, as opposed to the previous Most Economically Advantageous Tender means that non-financial considerations now carry greater weight than before. Whilst this may encourage a greater variety of tenders, how local authorities balance this against their own requirements will need to be considered from the outset, with the contracts having sufficient remedies for a failure to deliver on the Tender.
Another key change concerns robust requirements for local authorities to provide feedback to suppliers throughout the term of the contract, including statutory requirements to include three KPI’s for certain high-value contracts. Ensuring that contracts have enforceable provisions relating to the KPI’s will be crucial for local authorities to not only comply with the new Procurement Act, but also to gain the most benefit from using KPI’s effectively.
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