The Government’s policy statement guiding procurement reforms has landed. Peter Ware, partner at Browne Jacobson, explains the key points that councils need to know.

The landscape of public procurement in the UK is set to undergo a significant transformation with the Procurement Act 2023 coming into effect on 24 February 2025.

In anticipation of the implementation date – 16 months after it passed into law – the Government has released its updated National Procurement Policy Statement (NPPS), setting out strategic priorities that will shape how public bodies should approach procurement under the new regime.

Local authorities should ensure they align their procurement processes with the national objectives laid out within the framework of the NPPS.

Under the Act, they must have regard to the NPPS and will likely need to demonstrate this consideration at various points during procurement exercises.

Understanding the new procurement regime

The Procurement Act 2023, which received royal assent in October 2023, represents a decisive break from EU-derived regulations.

The legislation introduces a unified framework encompassing public contracts, utilities, concessions and defence procurement across England, Wales and Northern Ireland. This consolidated approach aims to enhance efficiency, transparency and accountability in public sector procurement.

The overarching principle of the Act is to ensure contracting authorities deliver value for money, maximise public benefit, act with integrity throughout a procurement exercise and continue to ensure equal treatment of bidders.

This change reflects a more UK-centric approach, with contracting authorities required to consider national policy objectives in their decision-making. These missions have now been published in the NPPS.

Core strategic priorities of the National Procurement Policy Statement

In the revised NPPS, published last week, the Government aims to align the procurement regime with broader policy missions by better positioning UK firms in public contract competitions, supporting sustainable growth and driving up living standards. It outlines several key priorities that local authorities must consider.

Economic growth and innovation

Local authorities are expected to create opportunities for small businesses and social enterprises, while supporting high-quality employment with fair wages. The emphasis lies on fostering innovation and emerging technologies, aligning with the Government's Industrial Strategy.

Environmental sustainability

A central focus is on how goods and services procured by public bodies can support the acceleration towards net zero. Local authorities must prioritise green technologies and implement rigorous environmental standards in their procurement activities, assisting the nation's ambition to become a clean energy leader.

Community development

The NPPS emphasises the importance of strengthening community cohesion through procurement practices. Local authorities should structure their procurement to facilitate employment opportunities for disadvantaged groups, contributing to safer and more inclusive communities.

Opportunity and access

Addressing skills gaps and removing barriers for young people and under-represented groups forms a crucial component of the policy. Local authorities must ensure their procurement practices harness diverse talent pools and promote inclusive growth.

Supporting the NHS

The statement recognises the role of procurement in supporting physical and mental wellbeing through high-quality employment. Local authorities must consider the health impacts of their procurement decisions on both the workforce and broader community.

Practical implementation

The Government has updated the Sourcing Playbook alongside the NPPS, introducing a new public interest test to enhance procurement effectiveness and value for money. Local authorities must now carefully evaluate whether services should be outsourced or delivered in-house, ensuring optimal use of public resources.

The framework places increased emphasis on supporting small and medium-sized enterprises (SMEs), and voluntary, community and social enterprises (VCSEs), while building robust commercial capabilities, particularly in contract management.

Impact on local authorities

For local authorities, the NPPS represents more than just guidance – it establishes a framework that must be actively considered in procurement design and delivery. This requires:

• Developing procurement strategies that align with national priorities

• Embedding social value considerations into decision-making processes

• Supporting local economic growth through engagement with SMEs

• Prioritising environmental sustainability in procurement practices

• Building internal capabilities for effective procurement management

The NPPS challenges local authorities to adopt a more holistic approach to procurement, balancing cost-effectiveness with broader social, economic and environmental impacts. By thoughtfully implementing these priorities, local authorities can contribute significantly to national objectives while ensuring sustainable and inclusive growth in their communities.

This transformation in procurement practices represents both a challenge and an opportunity for local authorities to reshape their approach to public spending, delivering enhanced value for their communities while supporting national strategic objectives.

Peter Ware is Head of Government and specialises in public procurement at UK and Ireland law firm Browne Jacobson.