RWK Goodman - The Procurement Act 2023: what does it mean for adult social care providers?

Overview

The Procurement Act 2023 (“the Act”) is coming into force from 24 February 2025 and affects all adult social care providers as suppliers of services to the public sector. Following its implementation, procurement and the resulting contracts between local authorities and adult social care providers must comply with the Act and its objectives.

Overall, the Act aims to embed transparency throughout the contract lifecycle, improving transparency around government spending, and introduces a stronger exclusions framework to avoid risks associated with providers whose standard of care is below an acceptable level.

There are a number of changes that social care providers will need to get to grips with, including new terminology and the mechanics of executing a particular requirement. We have summarised the key points below and provided some suggested action points:

Central Digital Platform (“CDP”)

With the aim of increasing transparency, contracting authorities are required to confirm that providers who wish to participate in procurement have registered and submitted core supplier information to the CDP. Moreover, the platform is anticipated to benefit providers, as it will make it easier to find and bid for contracts. All providers will need to be registered on the platform and we would recommend arranging this as soon as possible.

All notices, information and documents under the Act will need to be published on the CDP. The Government has created a range of new notice types for greater visibility on upcoming opportunities and so monitoring the CDP will be useful to stay on top of new prospects.

“User Choice Contracts”

Contracting authorities need to have regard to new procurement objectives when undertaking above threshold procurements. In the adult social care sector, this means that authorities have more scope to consider individual circumstances. Schedule 5 of the Procurement Regulations 2024 (which aims to assist in implementing the Act), sets out a new direct award justification for “user choice contracts.” It states that, where there is the appropriate statutory guidance, the contracting authority should consider the views of service users or their carers when determining which provider to award the contract to.

Overall, contracts will be awarded based on the concept of “most advantageous tender” as opposed to the “most economically advantageous tender” and it is expected that providers known for more specialist services are more likely to be awarded a contract without the more competitive tender process. Highlighting specialist services will be advantageous to providers. We’d recommend considering this when registering your information on the CDP.

Key Performance Indicators (“KPIs”)

Procurement is expanding to encompass pre-market engagement up to contract termination and so there are new obligations to report on contract performance and termination.

Before entering into a public contract with an estimated value of more than £5million, authorities must identify three KPIs and then publish the performance of a contractor against those KPIs on an annual basis. As a provider, you will need to analyse your current performance to identify strong areas to highlight and otherwise plan to strengthen weaker ones. This should enable authorities to understand how your offering would be the “most advantageous.” You will need to bear in mind the annual monitoring requirement and be prepared to meet targets. The alternative would be to risk inclusion on the public debarment list.

Debarment

There is a new debarment regime that will make it easier to exclude providers who have demonstrated poor performance in a previous contract. You might consider reviewing and/or amending your internal policies and action plans to show commissioners that any real or potential risks are being mitigated.

Expanded Notices Regime

The Government has created a range of new notice types, which will be published on the new central digital platform. Monitoring the types of notices and market trends via the platform could help to improve your long-term strategy as you adjust to the changes under the Act.

Summary:

Given the go live date is today providers will need to comply with the new legislation now. This might involve revising bidding templates, updating documentation and getting to grips with new terminology.

The Health & Social Care team at RWK Goodman is a recognised market leader, with in-depth knowledge and experience in the social care sector. Based across London, Thames Valley and the South West, our team of lawyers are fully immersed in social care, which enables us to cut to the heart of urgent matters quickly, and help you plan for what may lie ahead.

Our aim is to get to know your business and become the strategic advisors you trust to provide insightful, pragmatic solutions. Our clients include nursing and residential homes, hospices, homecare agencies, supported living, specialist colleges and children’s services and our advice covers many areas.

Hazel Phillips

Partner