Procurement Bill in the House of Commons

2023 will be a year of change in procurement as the impending Procurement Bill comes into effect, with CPC keeping a watchful eye on developments as this new Bill continues its legislative journey.

The Bill reached another noteworthy stage on Monday (9th January), with its Second Reading in the House of Commons, having passed through the Lords in 2022 to then reach the Commons last month.

Published as a Commons paper for the first time following its initial formalities, this Second Reading offered a first opportunity for British MPs to debate the Bill’s general themes and principles.

Originally announced in May 2022’s Queen’s Speech, the Procurement Bill is another consequence of the United Kingdom’s move to leave the European Union and sees pre-existing EU procurement regulations replaced with what has been presented as a consolidated and simplified approach.

A January UK government press release said: “The proposed reforms are designed to make it easier for businesses of all sizes to enter public sector supply‑chains and this will in particular benefit Small and Medium Enterprises (SMEs) and Voluntary, Community and Social Enterprises (VCSEs), both of which have historically faced barriers in working with central government and wider public sector”.

Described as the kind of transformation not seen on British shores in more than half a century, the regulations installed by the new Procurement Bill will form the overall framework which dictates how public bodies in much of the UK will be able to procure goods, works and services in future.

However, with procurement a matter for the UK’s devolved governments, it is worth remembering the Procurement Bill will not apply to Scottish institutions, for the most part, with Holyrood instead opting to adopt and transpose the existing EU regulations and thus continuing much as before.

Moreover, as compliance with World Trade Organisation (WTO) rules related to public procurement will continue to be an overriding necessity, a number of enshrined public procurement principles are set to remain in place, regardless of efforts to abandon EU laws, regulations and directives en masse.

To that extent, the exact number of regulations that will be overhauled is still to become clear, with amendments able to shape the Bill’s final form, as it undergoes prerequisite parliamentary scrutiny.

Among the most notable and relevant changes proposed by the streamlined Procurement Bill is the revocation of The Public Contract Regulations 2015, which was derived from existing EU legislature.

These regulations reflected previous UK government policy that purchasing decisions in the public sector should be guided by gaining value for money, whereas the Procurement Bill takes a broader approach, as previously outlined in its National Procurement Policy Statement (NPPS) of June 2021.

The NPPS highlights the societal value that good public procurement can deliver in the UK, from new business creation to supplier diversity and innovation to tackling climate change and reducing waste.

It is said every £1 in £3 from the public purse (or £300 billion a year) is spent in the realm of public procurement, thus considered analysis can well be expected as the Bill negotiates the Commons.

Following the Second Reading, which can be viewed online, the Bill is set to advance to Committee stage for detailed, line-by-line examination and the Report stage, before a Third Reading for MP approval.

To become law, the Bill then requires a final consideration of amendments where the House of Lords can approve the changes and wording added by the Commons, preceding a conclusive Royal Assent.

It is expected that those regulations confirmed in the completed Bill will come into effect around September 2023 at the earliest and CPC will continue to monitor its status in the interim months.

Our latest government update indicates the Bill will be sent for Committee consideration later in the month of January, while anticipating a series of further debates on the topic through February.

In the meantime, the current shape and status of the Bill can be viewed on the Parliament.uk website, which will also house the Hansard record of the Second Reading debate and associated documents, such as updated explanatory notes.

With the Transforming Public Procurement landing page acting as a repository for a range of related information, the UK government has furthermore published a new document that compiles the Bill’s suggested benefits to suppliers; a document that can be accessed here.

Finally, the government is promoting open-access webinars on the Bill’s progress and the next steps, for which interested parties can register via these links:

• Transforming Public Procurement Update, Friday 13 January at 10:30-11:30
• Transforming Public Procurement Update, Wednesday 18 January at 14:00-15:00
• Transforming Public Procurement Update, Monday 23 January at 14:30-15:30

Readers wishing to register for direct government updates on the Procurement Bill can do so here.

Did you know that, as a central part of the CPL Group’s charitable objective, CPL Learning offers institutions the opportunity to increase their knowledge of procurement matters through a variety of free resources and funded training courses?

For further information, visit cpl.group/learning