How does the Procurement Act 2023 change supplier selection?

The Procurement Act 2023 fundamentally changes how public sector organisations in the UK select suppliers, replacing the previous regime under the Public Contracts Regulations 2015 with a more flexible, transparent, and risk-based framework. Organisations must now assess suppliers against updated exclusion grounds, revised selection criteria, and new performance history requirements. The sections below unpack each of the major changes in detail, from exclusion rules to transparency obligations and compliance steps.

What are the key supplier selection changes under the Procurement Act 2023?

The Procurement Act 2023 replaces the fragmented procurement rulebook that previously governed public sector buying with a single, unified framework. The most significant change to supplier selection is the shift from a compliance-led tick-box approach to a more judgement-based, risk-proportionate assessment. Contracting authorities now have greater discretion in how they structure selection, but also carry greater responsibility for documenting and justifying their decisions.

Several headline changes affect how suppliers are assessed at the selection stage. The standard pre-qualification questionnaire has been replaced by a new selection process that allows contracting authorities to set their own criteria, provided those criteria are proportionate and relevant to the contract. Mandatory exclusion grounds have been expanded and clarified, and a new Debarment List has been introduced, giving contracting authorities a centralised reference point for suppliers who have been formally excluded from public procurement. Supplier performance history, including past contract delivery, now plays a more formal role in selection decisions. Transparency obligations have also increased significantly, with new requirements around publishing selection decisions and the reasoning behind them.

What are the new mandatory and discretionary exclusion grounds?

Under the Procurement Act 2023, mandatory exclusion grounds are those that require a contracting authority to exclude a supplier from a procurement process automatically, without any exercise of discretion. Discretionary grounds are those where the authority must consider whether exclusion is appropriate based on the specific circumstances. Both categories have been expanded compared to the previous regime.

Mandatory exclusion grounds

The mandatory exclusion grounds now cover a broader range of criminal conduct and misconduct. Suppliers must be excluded if they, or their associated persons, have been convicted of offences including fraud, bribery, money laundering, tax evasion, modern slavery, and certain competition law infringements. The inclusion of associated persons, which can mean directors, beneficial owners, or subsidiaries, is a notable expansion. Contracting authorities are required to check the central Debarment List, maintained by the Cabinet Office, before awarding any contract. A supplier listed there must be excluded from the relevant categories of procurement.

Discretionary exclusion grounds

Discretionary grounds allow contracting authorities to exclude suppliers where there is evidence of misconduct, poor performance, or risk, but where a mandatory bar does not apply. These grounds include situations where a supplier has demonstrated a significant or persistent failure to perform a previous public contract, where there is evidence of misrepresentation during a procurement process, where the supplier is in financial difficulty, or where there are reasonable grounds to believe the supplier poses an integrity or security risk. Critically, the Act requires authorities to consider whether the supplier has taken sufficient self-cleaning steps before deciding to exclude on discretionary grounds.

How does the selection questionnaire process change for suppliers?

The standard pre-qualification questionnaire (PQ) used under the previous regime has been replaced by a more flexible selection stage under the Procurement Act 2023. Contracting authorities are no longer required to use a standardised template, but they must ensure that any selection criteria they apply are proportionate to the nature, complexity, and value of the contract being procured.

Suppliers should expect selection criteria to vary more between contracting authorities than they did under the old regime. Authorities have greater freedom to tailor their questions to the specific risks and requirements of the contract. However, the Act does impose guardrails: selection criteria must relate to the supplier’s ability to perform the contract, must not be discriminatory, and must be published in the tender notice so that all potential suppliers are aware of them from the outset.

For suppliers, this means that generic, one-size-fits-all responses to selection questions are less likely to succeed. A response that clearly connects the supplier’s experience, capacity, and track record to the specific requirements of the contract in question will be far more compelling under the new framework. Suppliers should also be prepared to address any exclusion grounds proactively, including providing evidence of self-cleaning measures where relevant.

What role does supplier performance history now play in selection?

Supplier performance history plays a more formal and significant role in supplier selection under the Procurement Act 2023 than it did under the previous regulations. Contracting authorities can now take into account a supplier’s track record on previous public contracts as part of the selection assessment, including instances of poor performance, termination, or persistent underdelivery.

This is a meaningful shift. Under the old regime, past performance was difficult to factor into selection in a structured way. The new Act creates a clearer legal basis for authorities to consider whether a supplier has demonstrated the capability and reliability to deliver, based on what they have actually done in previous contracts rather than what they claim they can do.

For suppliers, this raises the stakes on contract delivery. Poor performance on one public contract could influence selection decisions on future opportunities. Contracting authorities are expected to record and publish contract performance information through the new transparency framework, meaning that underperformance is more likely to be visible to other buyers. Suppliers with a strong delivery record stand to benefit, while those with a history of contract failures face a more challenging selection environment.

How does the Act affect transparency in the selection process?

The Procurement Act 2023 introduces significantly stronger transparency requirements across the procurement lifecycle, and the selection stage is no different. Contracting authorities are now required to publish a range of notices and decisions that were previously optional or not required at all, giving suppliers and the public far greater visibility into how selection decisions are made.

Key transparency changes at the selection stage include the requirement to publish a tender notice that sets out the selection criteria before the process begins, ensuring suppliers know what they will be assessed against. Authorities must also publish a contract award notice that explains why the winning supplier was selected and why unsuccessful suppliers were not taken forward. Where a supplier is excluded on discretionary grounds, the authority must be able to articulate and document its reasoning.

The central Debarment List is itself a transparency measure, creating a publicly accessible record of suppliers who have been formally debarred from public procurement. This increases accountability for both suppliers and contracting authorities, and it gives buyers across the public sector a shared intelligence resource when making selection decisions. Procurement teams should treat this transparency not as an administrative burden but as a discipline that strengthens the defensibility of their decisions.

What should procurement teams do to comply with the new selection rules?

Procurement teams working within public sector organisations need to take a structured approach to compliance with the new supplier selection rules under the Procurement Act 2023. Compliance is not simply a matter of updating templates; it requires a review of internal processes, decision-making frameworks, and documentation practices.

• Review and update selection criteria processes: Move away from standardised pre-qualification questionnaires and develop a process for setting proportionate, contract-specific selection criteria for each procurement.
• Check the Debarment List: Build a mandatory check of the Cabinet Office Debarment List into every procurement process before selection decisions are finalised.
• Strengthen documentation practices: Ensure that selection decisions, including decisions to exclude suppliers on discretionary grounds, are fully documented with clear reasoning that can withstand scrutiny or challenge.
• Train procurement staff: Ensure that everyone involved in supplier selection understands the new exclusion grounds, the self-cleaning concept, and the expanded transparency obligations.
• Embed performance recording: Start building robust records of supplier performance on current contracts, as this data will be relevant to future selection decisions and required for transparency reporting.
• Engage legal and commercial advisers early: For complex or high-value procurements, involve legal and commercial expertise at the selection design stage, not just at contract award.

Organisations that invest in getting their selection processes right now will be better placed to run faster, more defensible procurements and to attract higher-quality suppliers who value a well-run process.

How eXceeding helps with Procurement Act 2023 compliance

eXceeding supports public sector and third sector organisations in navigating the practical demands of the Procurement Act 2023, including the revised supplier selection requirements. Whether your organisation needs to redesign its selection processes, strengthen its documentation, or access specialist procurement expertise quickly, eXceeding offers flexible support tailored to your specific needs.

• Reviewing and updating your supplier selection and exclusion processes to align with the new Act
• Designing proportionate, legally defensible selection criteria for individual procurements
• Providing interim procurement professionals through our procurement resourcing service to support compliance-critical projects
• Training procurement teams on the new exclusion grounds, transparency obligations, and documentation requirements
• Running compliant tender processes end-to-end, from selection through to contract award

If your organisation is working through the implications of the Procurement Act 2023 and needs expert support, get in touch with the eXceeding team to discuss how we can help.

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