A new UK public procurement law

In 2023, the UK Parliament agreed on new public procurement legislation, moving beyond the previous public procurement regime based on European Union (EU) law. Public procurement legislation imposes on the public sector, and bodies with designated public responsibility, obligations to observe structured tender procedures when they contract out public services, especially those above a certain value threshold. It also provides remedies for aggrieved providers that lose out as a consequence of illegal contract awards. These public procurement rules have a variety of objectives, but mostly their aim is to ensure open and transparent tender procedures to maximize the benefit of market competition for the state when it buys goods or services from private suppliers. Where procedures lack transparency or are otherwise uncompetitive, this may restrict the state's choices and lead to suboptimal provider selection, meaning the public sector may not secure value for money, and therefore maximize public benefit, in its procurement.

The new UK public procurement law is one of the first major pieces of legislation to make use of greater freedom following Brexit, with the UK no longer being bound by EU law. The government presented the law as a chance mainly to simplify public procurement, to improve transparency and reduce bureaucracy, to adapt the regime to the UK's current procurement needs and to secure better access, especially for small and local providers, to public markets. The law repeals the existing regulations based on EU law and in their stead sets out new rules and procedures for public contracting authorities (including central government departments, their arm’s-length bodies and the wider public sector) in the selection of providers for the award of public contracts with a value above the relevant thresholds. It also includes provisions for contracts that fall below those thresholds.

Public procurement law is a complex and technical area of regulation, hardly a popular talking point. Yet in the debates over this new legislation, strong political sentiments and a profound unease with the way in which public contracting has developed in the UK in recent years, in ways that undermine attempts at delivering public value, quickly became apparent. UK government spending on public procurement has risen sharply in recent decades, and it currently accounts for roughly one third of all public spending in the UK.