New National Procurement Policy Statement published

On 13 May, the Government Commercial Function published a new National Procurement Policy Statement (the ‘NPPS’) which sets out the strategic priorities for public procurement and how contracting authorities (‘CAs’) can support their delivery. Juli Lau and Shyann Sheehy examine the key points.

Details: 06.Jun.2024

The NPPS is a statutory statement which will come into effect/’go live’ on the 28th of October 2024 alongside the Go-Live date for the Procurement Act 2023 (the ‘PA 2023’) and will on this date replace the NPPS currently in place as a policy statement under PPN 05/21.

National Priorities for Public Procurement:

The NPPS outlines that it will not conflict with the Government’s international trade obligations, existing procurement legislation, the Public Services (Social Value) Act 2012, or CAs current obligations to procure goods, works and services in an open, fair and transparent manner whilst guarding against fraud and corruption.

The NPPS details that CAs should have regard to the following when exercising their functions relating to procurements:

Value for Money	Value for Money should be at the forefront of all procurement activities and means optimising public funds use by balancing effectiveness, efficiency and economy over the life cycle of a service, product or works to achieve the intended outcomes of a procurement. Specifically, procurements should be designed and managed to enhance achievement of the associated policy outcomes.
Social Value	This should be regarded where it is relevant to the subject matter of the contract, and it is proportionate to do so, CA should aim to: create resilient business and opportunities for quality employment and skills development, improve innovation, supply chain resilience and security of supply, and tackle climate change and reduce waste. CAs must ensure any benefits considered do not place additional burdens on suppliers or create disproportionate clauses in tenders/contracts.
Small and Medium-sized Enterprises	CAs should ensure they level the playing field for SMEs, VCSEs and start-ups to allow them to compete in public procurement (e.g. by reducing and removing barriers in the procurement process).
Commercial and Procurement Delivery	CAs should consider whether they have the right operational policies and processes to manage the key stages of commercial delivery. This will involve considering how the principles, practices and guidance from the Government’s Playbook series could be applied to their organisation.
Skills and Capability for Procurement	CAs should consider their organisation capability and workforce plans and be confident they have sufficient work force and capability to ensure taxpayers money is spent effectively and efficiently. CAs can choose from several professional standards to benchmark themselves against (e.g. the Commercial Continuous Improvement Assessment Framework would be appropriate for those with a third party annual spend profile of £100m plus).

Exemptions:

All CAs must have regard to the NPPS and it will apply to CAs defined in s.2 of the PA 2023 with the exception of:

private utilities,
contracts awarded under a framework or dynamic market;
procurement under devolved Welsh or transferred Northern Irish procurement arrangements; and
devolved Welsh authorities or transferred Northern Irish authorities.

Additionally, the NPPS does not apply to the exercise of procurement functions in relation to exempted contracts under Schedule 2 of the PA 2023 and paragraphs 10-12 on social value of the NPPS do not apply to the exercise of procurement functions by the Ministry of Defence in relation to defence and security contracts (as defined in s.7 of the PA 2023).

Juli Lau is a Partner and Shyann Sheehy is a Paralegal at Sharpe Pritchard LLP.

We advise contracting authorities and utilities on all manner of issues relating to public procurement and our experts are on hand to guide you through the intricacies of the procurement reforms and to advise on any other procurement related issues.

For further insight and resources on local government legal issues from Sharpe Pritchard, please visit the SharpeEdge page by clicking on the banner below.

This video is for general awareness only and does not constitute legal or professional advice. The law may have changed since this page was first published. If you would like further advice and assistance in relation to any issue raised in this article, please contact us by telephone or email enquiries@sharpepritchard.co.uk

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