Helping you to prepare for the Procurement Act
New tendering rules and process will be introduced in the UK on 24 Feb 2025 | Visit our Procurement Act Hub to learn about these changes, and what you can do to prepare.
The Procurement Act was created to transform public procurement, making it simpler and more efficient for buyers and suppliers. As a supplier, you will have access to more opportunities and find it easier to bid for tenders.
In this article, we explore the benefits the Procurement Act offers suppliers, particularly Small and Medium-Sized Enterprises (SMEs), and how these changes can positively impact your business operations.
The Procurement Act significantly streamlines processes, making the bidding process less complicated for suppliers. By introducing greater standardisation and guidance across processes, you can become more familiar with expectations, and confidently create bids in line with buyer requirements. There are now only two processes you need to familiarise yourself with; the Open Procedure and Competitive Flexible Procedure.
Thanks to the Central Digital Platform (CDP), you will also have less duplication work. This platform allows you to store business details frequently used in tenders, and upload them as part of the bidding process.
Through the range of changes introduced with the Act, the UK government aims to encourage a wider range of companies to compete for public contracts. To achieve this, buyers have been set two objectives: to provide equal treatment to all suppliers and to adopt an SME-first approach, meaning procurements should not be designed with unnecessary barriers to entry for smaller businesses.
The new Most Advantageous Tender (MAT) policy reduces the emphasis on price competition. Evaluation criteria will favour bids which meet criteria beyond price and quality, and help the contracting authority meet objectives for social value and sustainability. This means smaller businesses unable to compete on price, can leverage their position within a community, or their smaller carbon footprint, to make their bid more ‘advantageous’. This holistic approach to evaluating tenders has the potential to see a lot more work being awarded to SMEs.
The act will also see contracting authorities increase their use of ‘Lots’, meaning large contracts will be split into smaller contracts with fewer deliverables. This decision should create many more tendering opportunities for smaller businesses, increasing the amount of work the UK public sector awards to SMEs.
The government is putting a focus on driving innovation, as it not only results in better value but also makes opportunities more accessible to SMEs. Through the Procurement Act, contracting authorities will be empowered to innovate by having access to more flexible processes, expert guidance, and support from their leaders.
With the introduction of Competitive Flexible Procedures, contracting authorities can support innovation by designing a procurement that allows suppliers to offer unique solutions. Through the use of Dialogue, suppliers could be given the opportunity to offer greater insight, allowing for unexpected solutions to be discovered. If a contracting authority allowed variant tenders, they would not have to be prescriptive with the deliverables and alternative solutions would be welcome. Open Frameworks will also support innovation by re-opening to allow access to new suppliers and solutions during their term of up to 8 years.
The UK government’s adoption of increased transparency will support information sharing, raising awareness of successful approaches and market developments, and encouraging more strategic decision-making across the public sector. Overall, the public sector will better understand their suppliers, the industries they operate in, and emerging solutions in the market, resulting in more procurements looking for innovative solutions.
Contracting authorities will now be required to provide feedback to all suppliers who have submitted bids for Public Contracts. Whether you are successful or not, you should expect to receive an overview of how your bid was evaluated, highlighting areas for improvement and providing rationale for their award decision.
The use the Competitive Flexible Procedure opens the door for greater supplier involvement in the procurement process. Pipeline Notices can give suppliers visibility of upcoming procurements for the next 18 months, Preliminary Market Engagement Notices invite suppliers to participate in the planning of procurements, and Planned Procurement Notices can give suppliers up to 12-months notice of a procurement.
On-time and prompt payments support growth, stability and professional relationships. The UK government is aware of the impact slow payments can have on businesses, particularly SMEs, and has introduced rules to ensure all suppliers are paid promptly. While 30-day payment periods are not new, they will now be a default requirement for Public Contracts, even if not explicitly stated. Contracting authorities will be monitored by the new Procurement Review Unit (PRU), which will have the power to investigate compliance with this requirement. Subcontractors will also benefit from these requirements, as the 30-day payment period applies to all subcontracts wholly or significantly tied to the delivery of Public Contracts.
