Procurement Act 2023 – Implementation and Future Outlook

A professional’s guide to the Procurement Act 2023. We explore the new legislation and offer a FREE COPY of our 50-page Procurement Act Handbook (published 2025). Expert guidance and checklists!

In this extract of the ESG Pro Procurement Act Handbook, we consider the key changes to the Procurement Act 2023 and especially the implementation and the future outlook.

Introduction to the Implementation of the Procurement Act (2023)

The Procurement Act (2023) introduces a transformative regulatory framework aimed at modernising public procurement in the UK. However, implementing such a substantial shift requires careful planning, phased rollouts, and extended transition periods to ensure all stakeholders—government entities, procurement professionals, and suppliers—are adequately prepared.

Initially expected to come into force in October 2024, the implementation of the Act has been delayed, with the new legislation effective on 24 February 2025. This extension provided businesses with additional time to align their procurement strategies with the updated requirements.

This section explores the reasons behind the delay, the key milestones in the implementation timeline, and the steps businesses must take to ensure compliance.

Reasons for the Delayed Implementation

The decision to delay the enforcement of the Procurement Act (2023) was driven by several factors, including:

1. Need for Comprehensive Trainingand Guidance

• Government authorities and procurement professionals require significant training to understand and implement the new procurement rules, compliance mechanisms, and reporting requirements. The additional time allows procurement bodies to provide:
• Trainingprograms and workshops to familiarise procurement teams with the Act’s requirements.
• Updated procurement guidance to ensure a consistent approach across public sector organisations.

2. Development of Digital Infrastructure as the Procurement Act (2023) introduces new digital reporting obligations, including:

• A centralised digital procurement platform to enhance transparency and improve accessibility to contract opportunities.
• Open-access contract registers for greater public scrutiny of procurement decisions.
• Automated compliance monitoring tools to ensure suppliers meet Social Value, sustainability, and legal requirements.

The delay ensures that these digital tools are fully developed and tested before the law comes into effect.

3. Supplier Readiness and Market Adaptation. While larger corporations may have well-established compliance processes, SMEs, social enterprises, and new market entrants need additional time to adapt. The delay allows businesses to:

• Understand and implement Social Value reporting frameworks in procurement submissions.
• Prepare carbon reductionand sustainability documentation in line with PPN 03/23.
• Adjust internal procurement processes to align with the Most Advantageous Tender(M.A.T.) evaluation model.

Implementation Timeline and Key Milestones

The UK government set out a phased implementation plan to ensure a smooth transition to the new procurement framework. The key milestones were as follows:

2023-2024: Pre-Implementation Phase

• Development of procurement training modules for public sector buyers and suppliers.
• Launch of new government procurement platforms to manage contract registration and reporting.
• Issuance of Procurement Policy Notes (PPNs) to provide interim guidance on Social Value, environmental impact, and compliance expectations.
• Publication of draft secondary legislation and guidance documents for public consultation.

2024: Transition and Early Compliance Preparation

• Testing of the new procurement system by selected government agencies.
• Finalisation of supplier compliance checklists to ensure businesses understand the updated requirements.
• Procurement teams start adapting to new contract evaluation methodologies under the M.A.T.
• Introduction of phased pilot schemes to evaluate the effectiveness of the new regulatory framework.

24 February 2025: Full Implementation of the Procurement Act

• All public contracts issued from this date must comply with the new regulations.
• All supplier bids must meet updated Social Value and sustainabilityreporting standards.
• Government contract registers go live, providing greater transparency on awarded contracts and procurement decisions.
• Public sector bodies must provide detailed contract justifications, ensuring fair competition and adherence to regulatory standards.

Checklist: Steps Businesses Must Take to Prepare

With full implementation now in force, businesses should take proactive steps to ensure they meet the compliance requirements of the Procurement Act (2023). Below are essential actions businesses should undertake:

	Review Procurement Policy Notes (PPNs): Ensure full compliance with PPN 06/20 (Social Value), PPN 03/23 (Carbon Reduction Plans), and other relevant procurement regulations.
	Train Procurement Teams: Conduct internal workshops and training sessions to familiarise bid-writing teams with the updated tendering criteria.
	Upgrade Digital Procurement Capabilities: Register on government e-procurement platforms such as Find a Tender Service (FTS) and integrate digital compliance tools into procurement workflows.
	Enhance Social Value Contributions: Establish clear reporting mechanisms to demonstrate local employment, carbon reduction, and supplier diversity in procurement bids.
	Develop Supply Chain Resilience Strategies: Review supplier relationships, ensure ethical sourcing practices, and develop contingency plans to manage risks in public contracts.
	Engage with Procurement Bodies: Attend government-hosted procurement forums, supplier engagement sessions, and workshops to gain insights into best practices for compliance.

Summary

The delay in implementing the Procurement Act (2023) provided businesses with a valuable opportunity to prepare for compliance and refine their procurement strategies. With the regulations in full effect from 24 February 2025, businesses must take proactive steps to familiarise themselves with the updated requirements, adopt digital procurement tools, and ensure their Social Value commitments align with government priorities.

By leveraging the additional preparation time wisely, businesses can position themselves competitively in public procurement, securing contracts while aligning with the UK government’s broader sustainability and transparency goals.

The next section will explore Conclusion and Future Outlook, discussing how procurement will continue evolving beyond 2025 and what businesses can expect in the coming years.

Conclusion and Future Outlook

As the Procurement Act (2023) moves towards full implementation, it represents a transformative shift in the UK’s approach to public procurement. By embedding principles of transparency, Social Value, sustainability, and innovation, the Act ensures that government spending delivers not only cost-effective solutions but also long-term benefits for society and the economy. The changes introduced in this Act will shape procurement for decades to come, redefining how businesses engage with public contracts and how government bodies allocate funding to suppliers.

While many of the reforms introduced by the Act focus on streamlining procurement and increasing accessibility, there are broader implications for the UK’s economic and sustainability agenda. The emphasis on environmental responsibility, supply chain resilience, and ethical sourcing aligns with national objectives such as net-zero commitments, carbon reduction goals, and increased SME participation in government contracts.

What Businesses Can Expect Beyond 2025

Beyond the February 2025 implementation deadline, procurement policies will continue to evolve. Businesses that engage in public sector tenders must stay ahead of these trends to remain competitive. Future developments in procurement are likely to focus on:

1. Increased Automation and AIin Procurement Decisions
   • The use of AI-driven evaluation models will enhance the fairness and efficiency of bid assessment, reducing bias and improving value-for-money assessments.
   • Digital contract management systems will streamline post-award reporting and compliance monitoring.
   • Smart procurement platforms will use predictive analytics to forecast supply chain disruptions and identify procurement risks before they occur.

2. Stricter Sustainabilityand Carbon Reduction Requirements
   • Businesses will face increasing pressure to demonstrate tangible carbon reductionefforts, aligning with PPN 03/23 and other environmental regulations.
   • Procurement authorities will begin applying higher weightings to sustainabilitycriteria, requiring suppliers to implement eco-friendly production processes, waste reduction strategies, and renewable energy solutions.
   • Companies that fail to meet sustainabilitybenchmarks may face disqualification from major government tenders.
3. Enhanced Supplier Diversity and Social Value Accountability
   • More public sector contracts will prioritise local and underrepresented suppliers, expanding opportunities for women-owned businesses, minority-led enterprises, and social enterprises.
   • Social Value commitments will be actively monitored and audited, ensuring suppliers fulfil their pledges to job creation, community investment, and ethical labour practices.
   • Expect greater alignment with NHSEvergreen Supplier Assessment standards, which set ethical and sustainability benchmarks for suppliers in the healthcare sector.
4. Expansion of Blockchainand Digital Contracting
   • Government agencies may begin using blockchain technology for procurement transparency, ensuring real-time tracking of contract execution and preventing fraud.
   • Smart contracts will automate compliance verification, reducing the need for manual documentation and audits.
   • Decentralised procurement platforms will enable secure, transparent transactions between government buyers and suppliers.

Recommendations Checklist

To thrive in this new procurement environment, businesses must take proactive steps to align with regulatory expectations, embrace digital procurement tools, and enhance Social Value contributions. Below are key recommendations:

	Stay Updated on Procurement Policy Changes – Regularly review updates from the Cabinet Office, Crown Commercial Service (CCS), and sector-specific regulators to ensure compliance with evolving requirements.
	Strengthen ESG and Social Value Strategies – Develop structured Social Value reporting mechanisms to ensure compliance with PPN 06/20 and sustainability obligations.
	Invest in Digital Procurement Readiness – Register on government e-procurement platforms, integrate AI-driven contract management tools, and explore blockchain-based procurement solutions.
	Enhance Collaboration with SMEs and Social Enterprises – Build partnerships that contribute to inclusive supply chains, offering subcontracting opportunities to small businesses and underrepresented suppliers.
	Train Procurement Teams on New Compliance Standards – Conduct internal workshops and training programs to ensure procurement professionals understand the M.A.T. model, transparency requirements, and Social Value benchmarks.

Looking Ahead: The Future of Public Procurement

The Procurement Act (2023) is not just about regulatory compliance—it represents an opportunity for businesses to rethink their approach to ethical procurement, sustainability, and innovation. As procurement continues to evolve, businesses that embrace digital transformation, prioritise Social Value, and align with sustainability goals will be best positioned to secure government contracts and drive meaningful impact.

By taking a proactive approach, companies can ensure they not only meet compliance requirements but also position themselves as leaders in sustainable and socially responsible procurement. The future of procurement is one of greater inclusivity, transparency, and long-term value creation, and businesses that adapt to these trends will benefit in the years ahead.

With the implementation deadline fast approaching, now is the time for businesses to review procurement strategies, invest in compliance readiness, and prepare for the next era of government contracting.