Although the Procurement Act 2023 has now received Royal Assent, work on the secondary legislation needed to bring this live is still ongoing with the cabinet office currently consulting on the detail and with the (current) target being October 2024. In a General Election year, whether this remains a priority is an open question.
As a result, the two yearly updates to procurement thresholds continue and the Public Contracts Regulations 2015 remain in force and unchanged. Determining whether a potential procurement is above or below the threshold still requires consideration of the full contract costs, i.e. for a 3-year contract one must include all three annual charges plus any costs associated with onboarding or exiting the contract if they exist.
The values apply to all procurements starting after 1st January 2024 and are not retrospectively applied to ongoing procurements started before that date.
Threshold values are as follows:
Although the rates have increased by a nominal amount, the impact of inflation on the market since the 2022 update means that in reality, more procurement activity will now fall under the regime and we would expect to see more cases of non-compliant procurement processes as a result.
As always, framework procurements remain a cost-effective route to meeting the requirements for regulated procurements. We can help guide you through determining whether this is the right route, what is the most appropriate framework to choose, through to a fully managed procurement exercise.
Please get in touch if you want to discuss further.
