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Small businesses to benefit from Procurement Regulations shake up

Small businesses to benefit from Procurement Regulations shake up

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Sweeping changes to the Procurement Act are set to benefit small businesses and promote innovation, while safeguarding national security in public contracts.

By Lisa Reece, Senior Bid Consultant at BWL Group

In a historic milestone, the Procurement Act has received Royal Assent, cementing its status as an Act of Parliament. This landmark legislation ushers in a new era of procurement regulations in the United Kingdom, heralding sweeping changes that are set to benefit small businesses and promote innovation while safeguarding national security in public contracts.

This transformative legislation is the result of the government’s commitment to making strategic, long-term decisions, steering the nation toward a brighter future. With the Act set to take effect in October 2024, it promises to bring enduring change for generations to come.

Simplifying Procurement for Small Businesses

At the core of the Procurement Act is a commitment to simplify procurement processes, particularly with small businesses in mind. It aims to create a more transparent, cost-effective, and innovation-driven procurement system, reducing costs for both businesses and the public sector.

The Act will streamline public sector procurement, making it more efficient and effective. Small and medium-sized enterprises (SMEs) are poised to gain a larger share of the £300 billion spent annually, opening up new opportunities for growth and success.

Enhancing National Security

As well as supporting small businesses, the Act establishes robust measures to protect national security within public contracts. It grants the government significant new powers to bar high-risk suppliers from bidding on sensitive categories, such as defense and national security-related contracts, while allowing them to participate in non-sensitive areas.

Breaking Down Barriers for SMEs

The Act places a new obligation on contracting authorities to assess and address the barriers faced by SMEs throughout the procurement process. For example, it ensures that smaller businesses are not burdened with unnecessary upfront costs, particularly in areas like insurance. This will level the playing field and promote fair competition.

Streamlining Bidding and Combatting Misconduct

The Act streamlines the bidding process for public contracts and provides procurers with greater flexibility in price negotiations and innovative solutions. This approach aims to deliver better value for money, reduce bureaucracy, spur innovation, and facilitate business between the public sector and suppliers of all sizes.

Furthermore, the Act introduces the possibility of excluding suppliers from bidding on contracts based on not only their past performance, but also grounds such as modern slavery or professional misconduct.

National Security Unit for Procurement

To ensure national security, the government will establish a National Security Unit for Procurement. This unit will investigate suppliers posing potential national security risks and determine whether they should be barred from public procurements.

Clearer, Faster Competition Processes

The Act leverages newfound Brexit freedoms to create a more transparent procurement system with clearer and expedited competition processes, particularly during emergency situations such as health pandemics. This allows contracting authorities to act quickly and transparently to secure vital goods.

Promoting National Strategic Priorities

Contracting authorities must now consider national strategic priorities, as outlined in the National Procurement Policy Statement. This may include objectives like job creation, enhancing supplier resilience, and fostering innovation.

The Act’s changes are anticipated to take effect after secondary legislation is enacted, following a six-month implementation period. The Cabinet Office will provide comprehensive support to public sector contracting authorities in preparation for the transition.

The Act marks a pivotal moment in the UK’s economic development, creating a fairer, more competitive landscape for businesses of all sizes. Should you require support with understanding these changes, or if you have any-bid related queries, please contact us and an experienced bid professional will be in touch. Alternatively, you can email us at enquires@bwlgroup.co.uk.

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