Procurement and Contracting Policy

Document control:

Document control information

Policy name: Procurement and contracting policy
Policy number: F001
Version: 1.0
Status: Final – Approved
Author / Lead: Associate Contracting Director Strategic Commissioning
Responsible Executive Director: Executive Chief Finance Officer
Responsible Committee: Finance & Performance Committee / Audit Committee
Date ratified by Responsible Committee: 24 March 2026
Date approved by Board/Effective date: 1 April 2026
Next review date: April 2028
Target audience: All employees / Governing Body members / third parties working on behalf of ICB should be aware of this policy, and managers must bring its contents to the attention of their staff.
Stakeholders engaged in development of policy (internal and external): ICB Procurement Advisors
Impact assessments undertaken: Equality and Health Inequalities Impact Assessment

Version history

Version 0.1

Date: 10/01/2026
Author (Name and title): Amy Wilson and Kevin Edwards (Attain) / Victoria Sawtell
Summary of amendments made: Initial EICB Policy: For Review

Version 1.0

Date: 24/03/2026
Author (Name and title): Corp Svcs & Gov Support Officer
Summary of amendments made: Final – Approved version

Introduction

This document is the Procurement Policy for NHS Essex Integrated Care Board (“the ICB”), including any future successor body, and establishes the guiding principles, legal compliance requirements, and operational procedures for procurement activities. The policy reflects key legislative changes introduced by the Procurement Act 2023 (PA 23) and The Procurement (Transitional Provisions) Regulations 2024 (the Transitional Provisions) and the ‘Health Care Services (Provider Selection Regime) Regulations 2023’ (the PSR 23), ensuring compliance with the new legal frameworks.

This procurement policy sets out the framework within which the ICB will work to ensure that the development of commissioning strategies and any associated procurement directly contributes to the ICB’s corporate aims and objectives and meets legal requirements. It also aligns with broader government objectives, including social value, economic growth, and environmental sustainability, ensuring that procurement activities are conducted with integrity, fairness, and in compliance with statutory obligations.

This is a controlled document. Whilst this document may be printed (please consider if this is necessary), the electronic version posted on the intranet is the controlled copy. Any printed copies of this document are not controlled. As a controlled document, this document should not be saved onto local or network drives but should always be accessed from the website (or requested from the Governance Lead/Team) to ensure the most up-to-date version is used.

Purpose and policy statement

The purpose of this policy is to:

• Align the organisation’s procurement practices with the Procurement Act 2023 (PA 23), Procurement Regulations 2024,(Regulations 24), Transitional Arrangements and Health Care Services (Provider Selection Regime) Regulations 2023 (PSR 23).
• Enhance transparency, efficiency, and fairness in procurement processes.
• Ensure that procurement decisions deliver value for money while promoting social, economic and environmental responsibility.

The Policy objectives are:

• To set out how the ICB will meet statutory procurement requirements primarily the Procurement Act 2023 and Procurement Regulations 2024, Transitional Arrangements and Health Care Services (Provider Selection Regime) Regulations 2023.
• To set out the principles, rules, and methodologies that the ICB shall work to and clearly outline how and when it is appropriate to seek to introduce contestability as a means of achieving the best clinical outcomes and achieve value for money.
• To set out the approach for facilitating open and fair, robust, and enforceable contracts that provide value for money and deliver required quality standards and population health outcomes, with effective performance measures and contractual levers as necessary.
• To describe the transparent and proportional process by which the ICB will determine whether products and/or services are to be purchased through existing contracts with providers, competitive tenders, via a framework approach or through a non-competitive process.
• To support the ICB to undertake appropriate commercial interventions and activities ensuring up to date provider landscape knowledge that can inform appropriate application of the Procurement Act 2023 and Procurement Regulations 2024, Transitional Arrangements and Health Care Services (Provider Selection Regime) Regulations 2023.
• To enable early determination of whether, and how, services are to be opened to the market, to facilitate open and fair discussion with existing and potential providers and thereby to facilitate good working relationships and broader integration.
• To ensure the ICB does not engage in anti-competitive behaviour and to protect and promote the right of patients to make choices about their care.
• To enable the ICB to demonstrate compliance with the principles of good procurement practice.

Scope

1. This policy applies to all staff and members of the ICB and any third party working in association with, or on behalf of, the ICB. This policy applies to all ICB procurements (clinical and non-clinical). However, certain sections only relate to procurement of health and social care services.

It applies to all procurement activity and decision making related to the delivery of health and care services including, but not limited to:

1. the development and approval of business cases and specifications for goods and services.
2. the determination of which organisations shall provide services.
3. the determination of whether a service should be decommissioned.

Definitions

Roles and responsibilities

Integrated Care Board

The Board of the ICB is responsible for setting the appropriate governance arrangements for procurement and contracting as well as making procurement decisions in accordance with the scheme of reservation and delegation.

Audit, risk and compliance committee

The Audit, Risk and Compliance Committee is responsible for monitoring compliance with this Policy through regular review of the Register of Procurement Decisions and through regular review of all non-compliant procurement routes used, with support from ICB Procurement Advisors.

The Audit, Risk and Compliance Committee must also be notified, in order to review and scrutinise, all waivers that have been approved on behalf of the ICB.

Commissioning, quality and resource committee

The Commissioning, Quality and Resource Committee is responsible for decision making as set out in the Scheme of Reservation and Delegation and for oversight of the ICB finances.

The Commissioning, Quality and Resource Committee has responsibility for reviewing all requests for non-compliant procurement routes to ensure that they are in line with the criteria as set out within this Policy and that appropriate support from ICB Procurement Advisors has been sought prior to decisions being made.

The ICB Provider Selection Regime Review Group is a sub-group of the Commissioning, Quality and Resource Committee. 

Provider selection regime review group

The PSR Review Group is responsible for independent review of certain PSR contract awards where representations have been made by Providers.

Chief Executive Officer

The Chief Executive Officer is accountable for implementation of this Policy and shall ensure the ICB is operationally fit for purpose to comply with it.

Executive Director of Finance and Commercial Officer

The Executive Director of Finance and Commercial Officer is responsible for monitoring operational compliance with this Policy with support from the Contracting Team and ICB Procurement Advisors.

The Executive Director of Finance and Commercial Officer is responsible for sign off (waiver) of all non-compliant procurement routes.

Policy authors

The Policy Authors are responsible for the accuracy and completeness of information contained within this Policy and for recommendation of amendments to ensure ongoing compliance with national guidance, regulation or local system requirements.

Contracting team 

The Contracting Team, under the leadership of the Director of Commercial, alongside the ICB’s Procurement Advisors are operationally responsible for establishing the framework underpinning well governed procurements made in accordance with ICB Policies, and relevant legislation and procurement regulations. 

Line managers 

Line Managers are accountable for recognising when a purchasing decision may have potential procurement implications and for seeking appropriate procurement support.

All staff

All staff must read and understand this Policy, comply with it and be aware of its implications. It is not intended that staff will develop procurement expertise; however, they will need to know when and how to seek further support.

Policy detail

Summary of the procurement regulations 

As an NHS organisation procuring goods, services, or health care the ICB must comply with a broad set of legal duties and frameworks. The PA 23 applies to non-health care good and services, whereas health care services fall under the PSR 23. In either case, the ICB must also adhere to health-specific legislation, and a range of cross-cutting public law obligations that govern equality, transparency, social value, and data protection. Together, these frameworks ensure that procurement is conducted in a way that is lawful, fair, value-driven, and accountable to patients, the public, and the wider system.

Primary legislation and core procurement law

Procurement Act 2023 – Governs all covered public procurements, including by NHS bodies (e.g., NHS Trusts, ICBs) when the contract does not fall under the health care-specific Provider Selection Regime and sets out statutory objectives, procedures, and transparency obligations. PA 23 is described in more detail in Section 7 herein.

Procurement Regulations 2024 (Secondary legislation under PA 23) – Provides details on procedures, thresholds, notices, and technical implementation of the PA 23.

Health-specific legislation

Health and Care Act 2022 – Establishes Integrated Care Boards and NHS England’s functions; confirms NHS procurement powers and duties. Also includes duties to reduce health inequalities and involve patients in decision-making.

National Health Service Act 2006 (as amended) – Provides the core duties of NHS organisations to arrange for the provision of services.

The National Health Service (Provider Selection Regime) Regulations 2023 – Applies instead of PA 23 where NHS organisations are arranging clinical or health care services (note: not applicable to goods or non-health services). PSR 23 is described in more detail in Section 6 herein.

Cross-cutting and compliance legislation

Equality Act 2010 – The Public Sector Equality Duty (PSED) applies to procurement decisions and requires consideration of impacts on equality.

Public Services (Social Value) Act 2012 – Requires NHS organisations to consider how procurement might improve social, economic, and environmental well-being.

Data Protection Act 2018 / UK GDPR – Applies where procurement involves data sharing, processing, or Digital / IT systems.

Modern Slavery Act 2015 – Requires consideration of modern slavery risks in supply chains; and may act as a selection criterion during qualification stages for larger organisations.

Freedom of Information Act 2000 – Procurement-related information held by NHS bodies may be subject to disclosure unless exemptions apply.

Human Rights Act 1998 – Applies to procurement decisions that may impact individual rights.

Related legislation (where applicable)

TUPE Regulations 2006 – May apply if a procurement results in a transfer of staff between providers.

Local Government Act 1999 (Best Value Duty) – Relevant if local authorities are joint commissioners with NHS bodies, under a Section 75 arrangement for example.

Contracting principles

Guiding principles that underpin the policy

Contracting authorities must adhere to two distinct sets of procurement objectives or principles, depending on which regime applies (PA 23 or PSR 23). PA 23 sets out statutory objectives in Section 12, requiring contracting authorities to ensure value for money, act with integrity, provide equal treatment, and promote transparency and public benefit throughout the procurement process. 

In contrast, the PSR 23 requires relevant authorities to act in a way that improves service quality, facilitates collaboration, ensures value, and protects patient choice and continuity of care. 

The key difference lies in focus and flexibility: PA 23 emphasises competitive fairness and procedural transparency across all public contracts, while PSR 23 prioritises outcomes, continuity, and integration of care for health services, allowing direct awards without competition under specific circumstances.

Procurement objectives under PA 23

When conducting any non-healthcare procurement-related activity for a covered procurement, contracting authorities must have regard to certain objectives listed below. Contracting authorities have the discretion to determine how these objectives are considered, whether they are weighted, and what actions should be taken to align with them. While there are no minimum requirements for implementing these objectives, they should not be disregarded, as they serve to guide and influence best practices in procurement rather than act as strict rules. To ensure transparency and accountability, it is recommended that contracting authorities document how these objectives have been considered throughout the procurement lifecycle and maintain these records alongside other procurement documentation. Additionally, when fulfilling the obligation to treat all suppliers equally—unless different treatment is justified—contracting authorities must take reasonable steps to ensure that any variation in treatment does not result in an unfair advantage or disadvantage for any supplier.

Delivering value for money

Although this is not a new concept, the value for money objective encourages contracting authorities to consider further what value means to their organisation and the community it serves, and how they can get the best mix of economy, efficiency and effectiveness that achieves the intended outcome over the whole lifetime of the contract.

Maximising public benefit

The public benefit objective encourages contracting authorities to think about the extent to which their contracts can deliver greater benefit, for example by collaborating with other contracting authorities for a common purpose to reduce resource implications and costs or considering social value or environmental benefits that could be achieved by the contract.

Sharing information

Transparency is still a key consideration. The sharing information objective requires contracting authorities to share information for the purpose of allowing suppliers and others to understand their policies and decisions relating to procurements. This is in addition to the wider transparency obligations that have been embedded throughout the Act through clear publication requirements designed to ensure an approach of “transparency by default” and deliver greater transparency than any duty to have regard.

Example: A contracting authority is expected to keep suppliers reasonably informed of their progress in a competitive tendering procedure, including providing prompt notification and explanation of any decision to remove a supplier from the procedure.

Integrity

Acting, and being seen to act, with integrity objective helps to prevent fraud and corruption. Being able to demonstrate this objective through good management, prevention of misconduct, and having full control over and rigour in all processes is key to strengthening trust with suppliers and the general public.

Example: Public procurement must promote good governance, sound management of public money, and a professional relationship between contracting authority and supplier, by for example managing conflicts of interest, protecting intellectual property, copyrights and confidential information or other standards of professional behaviour.

Treat suppliers the same

Contracting authorities are required to treat suppliers the same unless a difference between the suppliers justifies different treatment.

Example: When a contracting authority sets a deadline for submission of tenders, they should not accept a late tender from one supplier but not from others. This would be a breach of equal treatment and also applies to other procedural requirements such as other deadlines, word limits, minimum quality or quantity standards etc.

Alternatively, where an incumbent supplier is bidding again for its replacement contract, (and so will inevitably have an advantage over other tenderers due to their experience in the current contract) the contracting authority must consider how this incumbent advantage can be managed to ensure all suppliers have an equal footing to win the replacement contract. In this case, different treatment intended to neutralise the advantage enjoyed by the incumbent may be justified and can be achieved for example by providing additional information on the contract specification. However, a lower risk alternative would be to provide the additional information to all suppliers (i.e. including the incumbent).

Do not put a supplier at an unfair advantage or disadvantage

If different treatment of suppliers is justified, contracting authorities must take the appropriate steps to ensure they do not put a supplier at an unfair advantage or disadvantage.

Example: Where a potential conflict of interest does seem likely to benefit one or a few of the suppliers but not all, then the contracting authority must take steps to level the playing field. Transparency and informing the suppliers of the same information or disclosing the current supplier’s name may be acceptable means of countering the potential problem. Each procurement scenario should consider the best mitigation under the circumstances during and from early engagement through to award recommendation.

Have regard to small and medium-sized enterprises (SMEs)

This objective encourages contracting authorities to specifically consider their requirements from an SME perspective, for example by reducing processes which are disproportionately burdensome on SME suppliers or transfer unfair levels of risk to the suppliers.

Example: Consider whether the tender period is realistic when some businesses do not have dedicated tendering teams and small businesses are less likely to be able to respond to procurement processes with short timelines. This potential barrier to an SME could be removed or reduced by adding an extra 10 days onto the minimum time limit for return of tenders for all suppliers to ensure that small businesses are not disadvantaged. This would be consistent with the requirement to treat suppliers the same because although the tendering period is longer to enable higher levels of participation of more diverse suppliers, such as SMEs, there is no actual disparity of treatment.

Procurement principles under the PSR 23

Regulation 4 of the PSR 23 sets out the procurement principles under this regime.

The ICB is expected to ensure that when following the PSR 23, they make decisions in the best interests of people who use the service. To do this, they must act with a view to all of the following:

• securing the needs of the people who use the services.
• improving the quality of the services
• improving efficiency in the provision of the services.

The ICB must also act transparently, fairly, and proportionately when procuring health care services.

The ICB may consider the value of providing services in an integrated way, including with other health care services, health-related services, or social care services, when acting in accordance with the procurement principles.

Governance

Standing orders

• The ICB will comply with the appropriate Standing Orders (and any other relevant governance documents) to ensure the procurement of supplies and services are undertaken in accordance with the relevant regulations described herein, guidance, and local delegated authorities, reducing the risk of any challenge of inappropriate application of the rules, regulations or the principles set out therein.
• The ICB will ensure it has access to specialist legal advice for large and complex procurements to facilitate and monitor compliance with these rules and regulations, as well as to demonstrate effective procurement processes.  

Scheme of Reservation and Delegation

• The ICB has approved a Scheme of Reservation and Delegation which includes delegated limits of financial authority for procurement which are set out within this policy for completeness.

Specifications

Best practice in developing a public sector specification involves creating a document that clearly defines the needs, outcomes, and requirements of a procurement in a way that is transparent, fair, and value-focused, while enabling innovation and competition. The goal is to ensure that the market understands exactly what is required, without unfairly limiting the range of potential providers.

To ensure tender questions are lawfully and effectively linked to the contract, contracting authorities must ground all questions in the specification, ensure they test relevant capabilities, and avoid requirements that go beyond the contract’s scope. Each tender question and evaluation criterion must be clearly derived from the subject matter of the contract, including any requirements around social value. 

Specification types

Output-based (preferred): Defines desired results (e.g. reduced emissions, improved patient outcomes).

Input-based: Describes how the service must be delivered (used where safety or compliance requires strict controls).

Functional: Describes the function a product or service must perform.

Best practice in developing Specifications

Specifications shall be developed and approved by the appropriate procurement lead and subject matter experts will be used to ensure specification validity where specific expertise is required or where this is agreed to manage a real or perceived conflict of interest.

Outcome-focused

Prioritise what needs to be achieved rather than prescribing how it must be delivered.

Encourage suppliers to offer innovative solutions to meet defined outcomes.

Evidence based

Base your requirements on clear needs analysis, user engagement, and market research.

Use data to justify performance standards or service levels.

Proportionate and non-discriminatory

Ensure that requirements are proportionate to the contract’s value and complexity.

Avoid criteria that favour particular suppliers or technologies without justification.

Clear and unambiguous

Use plain language and define all technical terms.

Clearly specify the scope, quality standards, performance indicators, and delivery timelines.

Aligned with procurement objectives (under PA 23) or procurement principles (under PSR 23)

Under PA 23, align the specification with objectives such as value for money, integrity, public benefit, equal treatment, and transparency.

Under PSR 23, relevant authorities must design service specifications transparently, proportionately, and without unjustified restriction, to enable proper consideration of suitable providers and to support high-quality, collaborative, and value-driven health care delivery.

Collaboratively developed

Engage internal stakeholders, end users, and technical experts early in the process.

Consider pre-market engagement to test feasibility and shape demand in line with market capacity.

Allow for flexibility and innovation

Where appropriate, allow suppliers to propose alternative methods, technology, or delivery models to achieve the desired outcomes.

Standardised and benchmarked where possible

Use standard specification formats (and benchmark specifications with that of other contracting authorities’ specifications) to ensure consistency and reduce supplier burden.

Sustainability and social value

In accordance with national NHS policy, all relevant procurements must apply the Social Value Model to ensure that contracts contribute to wider social, economic, and environmental outcomes. NHS organisations are required to allocate a minimum weighting of 10% to social value in all tenders, evaluating how suppliers will deliver benefits such as reducing health inequalities, supporting local employment and skills, improving environmental sustainability, and promoting equal opportunity. This approach aligns with NHS England’s commitment to delivering public value and supports the objectives of the NHS Long Term Plan and the Greener NHS programme.

Where social value is included, it should be framed in a way that relates directly to the delivery of the contract—for example, improving environmental sustainability, supporting local employment, or reducing health inequalities in the context of the service being procured. This ensures compliance with the principles of equal treatment, transparency, and proportionality, and supports the authority’s duty to deliver value for money and maximise public benefit. Bidders social value commitments should be in addition to the core delivery of the specification.

The ICB’s obligations for confidentiality and managing and Conflicts of Interest

Under both PA 23 (Sections 84–86) and the PSR 23 (Regulation 21), contracting authorities have clear obligations to identify, manage, and mitigate conflicts of interest to maintain integrity and public trust in procurement processes.

The following unified list captures the core obligations under both regimes, ensuring that the ICB’s procurement processes remain fair, transparent, and impartial.

Take all reasonable steps to identify conflicts – This includes actual, potential, or perceived conflicts of interest that could affect the procurement or provider selection process.

Maintain written records – Record identified conflicts and any actions taken to address or mitigate them.

Exclude conflicted individuals from involvement – Remove individuals with conflicts from any part of the process that could be biased or compromised (e.g. planning, evaluation, or decision-making).

Actively avoid or mitigate conflicts – Implement appropriate controls or changes to the process where a conflict cannot be fully eliminated.

Apply these rules to all involved parties – Including staff, advisors, consultants, suppliers, provider representatives, and anyone with influence over the procurement or selection process.

Apply obligations throughout the relevant process – From early planning through to contract award and management, ensuring ongoing vigilance as circumstances change.

In order to implement the above, every tender must require suppliers to:

• provide a written undertaking to maintain confidentiality.
• agree not engage in collusive tendering or other restrictive practice.
• complete a declaration under Sections 84–86 of the PA 23for non-healthcare service provision
• Complete a declaration under Regulation 21 of the PSR 23 for healthcare service provision.

All those engaged in development and evaluation of a tender or procurement process should be reminded that all documentation, including emails, may be called upon as part of any investigation of a complaint, and that the use of non-secure email or social media for any communication is not permissible. 

All those participating in the development and evaluation of a tender or procurement process, including third parties, will be required to sign a specific declaration of interest and a confidentiality agreement in accordance with the Conflicts of Interest, Standards of Business Conduct, Gifts, Hospitality and Commercial Sponsorship Policies. In addition, a procurement specific Conflict of Interest form will also require completion aligned to the relevant potential providers that we anticipate and eventually have participating in and responding to the tender.

Any concerns identified regarding fraud or bribery because of conflicts of interest or gifts and hospitality shall be brought to the attention of the Local Counter Fraud Specialist for the ICB or the NHS Counter Fraud Authority either via the NHS Fraud Reporting Line 0800 028 4060 or online at: https://cfa.nhs.uk/reportfraud

Evaluation Panel and subject matter expertise

The ICB has a requirement to ensure its procurement processes are fair and transparent and this includes making sure that it provides suitably qualified subject-matter experts to support the evaluation of any competitive process. Where this is not possible within the ICB footprint the ICB may, in certain circumstances, secure support from out of area ICBs. Examples of such circumstances may include where following a successful representation process, the ICB has to rewind to a previous stage of the procurement and has to convene a new panel to evaluate a new set of questions or where an out of area clinician is required to avoid any conflict of interest from any clinicians employed by local providers.

Complaints and Dispute Resolution under PA 23

The ICB should have a Competition Dispute Resolution process to hear any complaints from organisations who consider that the ICB, or the ICB’s Procurement Advisor, has not complied with applicable regulation under PA 23, this Policy, or any other relevant policies.

Representation Panel under PSR 23

The ICB has established an internal PSR Representation Panel to independently review representations made by Providers under the relevant circumstances for PSR procurements.

In the vein and spirit of openness and transparency the ICB may utilise an out of area representative as part of its Provider Selection Regime Representation Panel. This will help mitigate against either perceived or direct conflict from those who have been involved in the original procurement decision and supports an independent majority.  

Premises and equipment

The ICB will be responsible for liaising with NHS Property Services to ensure that the impact on utilisation of existing premises and/or associated equipment or contracts has been fully reviewed and incorporated into any proposed procurement arrangements.

Where applicable, representatives of NHS Property Services should be included as full project team members from an early stage. Where GP premises are, or may be, utilised as part of a procurement, then the Procurement Project Lead will ensure that this information is discussed with appropriate Primary Care Estates Lead.

Decommissioning services

Where services are decommissioned, the ICB will ensure where necessary that contingency plans are developed to maintain patient care. Where decommissioning involves Human Resource issues, such as TUPE, then providers will be expected to co-operate and be involved in discussions to deal with such issues.

In addition to contingency planning and TUPE considerations, the ICB will ensure that any service decommissioning is carried out in compliance with legal duties around public involvement, equality impact assessment, and patient safety. The process must adhere to the relevant procurement regulations (where applicable), contractual notice requirements, and the ICB’s internal governance procedures. The ICB understands that engagement with stakeholders, clear communication plans, and transitional care arrangements are essential to safeguard service continuity and minimise risks to patients and staff.

The ICB Decision Making Policy and Procedure sets out the process to be followed if and when decommissioning a service.

Wider Stakeholder consultation and engagement

Stakeholder engagement in the early stages of procurement should be inclusive, structured, and transparent. It enables the ICB to understand user needs, market capacity, and delivery challenges before shaping the procurement strategy. Engagement must be proportionate, non-discriminatory, and compliant with the relevant procurement regulations, with clear documentation and feedback mechanisms to ensure accountability and trust.

The ICB shall aim to adhere to the following principles on stakeholder involvement during a procurement process:

Start early – the ICB will engage before the specification or route-to-market is finalised and will use engagement to identify need, define outcomes, and assess feasibility.

Map and involve key stakeholders – the ICB will aim to include a cross-section of stakeholders:

Internal: service users, clinical or operational leads, finance, legal, HR, procurement.

External: current or potential suppliers, service users, community representatives, voluntary sector, regulators.

Consider those impacted by or delivering the service.

Be transparent and consistent – 

Clearly explain the purpose of engagement (e.g. market shaping, gathering insights—not awarding a contract). 

Avoid giving unfair advantage to any one provider.

Document and share key themes or feedback summaries.

Use Multiple Engagement Channels – Options may include:

Market engagement events or soft market testing,

Surveys, questionnaires, or focus groups,

Informal 1:1 conversations (with clear boundaries),

Online collaboration platforms (for wider accessibility).

Focus on outcomes and challenges – The ICB will avoid overly prescriptive discussions about “how” to deliver services and instead ask stakeholders for input on things like:

Service outcomes and user needs,

Barriers to entry or innovation,

Potential delivery models or risks.

Ensure compliance with legal duties

Keep engagement non-discriminatory and in line with the PA 23 or PSR 23, depending on the context.

Do not disclose confidential or commercially sensitive information.

Feedback and close the loop

Share how engagement findings have influenced the procurement strategy.

Maintain trust by demonstrating that feedback is valued—even if not all input is used.

Implement a formal consultation process should there be any variations to the delivery of the service. 

Health Care Services (Provider Selection Regime) Regulations 2023 The NHS Long Term Plan highlighted the need to modernise health and care services to handle rising demand, improve outcomes, and ensure financial sustainability. In response—especially following the COVID-19 pandemic—the NHS, local authorities, and other partners are working more closely to deliver integrated care and better health for communities.

The Health and Care Act 2022 (the 2022 Act) introduced legislative changes to support this transformation, including the creation of Integrated Care Systems (ICSs). It encourages organisations involved in planning and delivering services to collaborate around shared goals.

A major change from the 2022 Act is the introduction of the PSR 23, which replaces previous procurement rules and removes health care service procurements from the PA 23.

The PSR 23 gives Integrated Care Boards (ICBs) more flexibility in choosing providers. While competitive tendering remains an option, it is no longer mandatory in all cases. Instead, the PSR 23 supports proportionate approaches that help build stable partnerships and deliver integrated care.

The regime still requires ICBs to act fairly, transparently, and proportionately, and to ensure value for money in decision-making. Statutory guidance has been issued to help organisations apply the new rules effectively.

Introduction of PSR 23 for health care services

In keeping with the intent of the 2022 Act, the PSR 23 has been designed to introduce:

• a flexible and proportionate process for selecting providers of health care services (so that all decisions can be made with a view to securing the needs of the people who use the services, improving the quality of the services, and improving the efficiency in the provision of the services)
• the capability for greater integration and collaboration across the system, while ensuring that all decisions about how health care is arranged are made transparently.
• opportunities to reduce bureaucracy and cost associated with the current rules.

Existing arrangements

The PSR 23 makes it possible to continue with existing arrangements for service provision where those arrangements are working well and there is no value for people who use the service in seeking an alternative provider. Where there is a need to consider changing arrangements for service provision, it provides a fair, transparent, and proportionate process for decision-making, which includes the option of using competitive tendering.

Scope of PSR 23

PSR 23 applies to the arrangement of health care services by certain public bodies in England, including NHS England, Integrated Care Boards (ICBs), NHS Trusts/Foundation Trusts, and local authorities. 

It covers the procurement of health care services, including public health, when these are paid for with public funds and delivered to individuals. It is only those services that provide health care (whether treatment, diagnosis or prevention of physical or mental health conditions) to individuals (i.e., patients or service users) or groups of individuals (e.g., where treatment is delivered to a group such as in the forms of group therapy).

The PSR 23 replaces previous procurement rules for these services, such as the PCR 15 and the PPCCR, only where health care is the main subject of the contract.

PSR 23 only covers “relevant” health care services, defined by the Common Procurement Vocabulary (CPV) codes set out in Schedule 1 (Annex A) of the PSR 23. The ICB must use the most relevant CPV code(s) for the health care service they are procuring. Where a more detailed code is not available, the ICB are expected to use the overarching parent code for ‘health services.

In summary, a service is in scope when a relevant authority is commissioning or subcontracting a service that:

1. is provided as part of the health service, whether NHS or public health
2. consists of the provision of health care to individuals or groups of individuals
3. falls within one or more of the specified CPV codes.
   
   In-scope health care services include services provided by NHS providers, other public bodies, local authorities, and providers within the voluntary, community, and social enterprise (VCSE) and independent sectors. In broad terms, these are services arranged by the NHS such as hospital, community, mental health, primary health care, palliative care, ambulance, and patient transport services for which the provider requires Care Quality Commission (CQC) registration, as well as services arranged by local authorities focused on substance use, sexual and reproductive health, and health visits.
   
   The regime does not apply to:
   
   Procurement of non-health goods or services (which remain under PA 23) such as:
   
   Mixed procurements where health care is not the main component,
   
   Contracts arranged entirely for internal delivery within the same legal entity.

Mixed procurement

Mixed procurement is defined in Regulations 3(2), 3(3), 3(4), and 3(5) of the PSR 23.

Contracts to deliver health care services may contain multiple elements, some of which are health care services clearly within the scope of the PSR 23, and some of which, if procured alone, would be within the scope of the Procurement Act 2023.

The PSR 23 must not be used for the procurement of goods or non-health care services alone.

When a contract comprises a mixture of in-scope health care services and out-of-scope services or goods, the ICB may only use the PSR 23 to arrange those services when both of the below requirements are satisfied:

The main subject-matter of the contract is in-scope health care services.

The relevant authority is of the view that the other goods or services could not reasonably be supplied under a separate contract.

The main subject-matter of the contract is determined by the component that is higher:

• the estimated lifetime value of the health care services, or

• the estimated lifetime value of the other goods or services.

A relevant authority may only determine that other goods or services could not reasonably be supplied under a separate contract where the relevant authority is of the view that procuring the health care services and the other goods or services separately would, or would be likely to, have a material adverse impact on the relevant authority’s ability to act in accordance with the procurement principles.

The ICB must keep an internal record of the rationale for their decision, as this would be a reason for the decision made (see transparency).

Where the above tests are met, then PSR 23 applies, and a mixed procurement can be undertaken. Where these tests are not met, PSR 23 does not apply and the procurement must be undertaken under PA 23.

A notable area of the use of mixed procurement may be the arrangement of health care and social care services together in a single contract. This may be done under the PSR 23 when the highest estimated value of the contract is attributable to the health care services, and when procuring the health care services and social care services separately would have a material adverse impact on the relevant authority’s ability to follow the procurement principles, e.g., to improve the quality or the efficiency (which may include value) of the procured services.

Other examples of services that can be arranged under PSR 23, but that might require some extent of mixed procurement of health care and non-health care services to achieve their core objectives, include but are not limited to:

1. health care and social care services under a section 75 partnership arrangement
2. patient transport, which includes health care services (for which the provider requires CQC registration) and non-health care services (where no CQC registration is required)
3. packages arranged under the Better Care Fund
4. discharge to assess services.
5. mental health aftercare services, such as support services arranged under section 117 of the Mental Health Act 1983
6. prison services that include health care services
7. asylum seeker services that include health care services
8. veteran services that include health care services

Governance

PSR 23 does not require the ICB to structure their decision-making arrangements in any specific way or require provider selection decisions to be taken by particular committees or at a particular level within an organisation or system. Instead, the ICB are expected to ensure that their internal governance supports the effective application of the PSR 23. As such the ICB has established how best to follow PSR 23 within their wider structural and governance arrangements.

Planning

To apply PSR 23 effectively, the ICB will establish a clear understanding of the services they want to arrange and the outcomes they intend the services to deliver as a prerequisite to any decision about selecting a provider. This should be completed in good time via the routine planning activity that takes place across the system. The ICB will reflect these intentions in their commercial pipeline, and decisions taken under PSR 23 will serve and reflect these intentions.

The ICB will adhere to PSR 23 when dealing with unplanned urgent situations.

Provider landscape

The ICB aims to develop and maintain sufficiently detailed knowledge of relevant providers, including an understanding of their ability to deliver services to the relevant (local/regional/national) population, varying actual/potential approaches to delivering services, and capabilities, limitations, and connections with other parts of the system. The ICB where relevant and proportionate, will undertake pre-market engagement to update or maintain their provider landscape knowledge in order to ensure decisions are taken appropriately under PSR 23. For example, that the ICB has enough evidence to confirm the existing provider is performing to the best quality and value, that the ICB does not miss opportunities to improve services and can identify valuable innovations, and ultimately to undertake robust procurement exercises with integrity and rigour to reduce to the risk of provider representations during the standstill period. 

The ICB will not treat providers from different sectors (such as the VCSE and independent sectors) differently from NHS trusts and foundation trusts or local authorities solely based on that status.

Taking a proportionate approach

The PSR 23 applies to the arranging of all health care services; there is no minimum threshold for application of PSR 23. Therefore, when applying PSR 23, the ICB aims to take a proportionate approach ensuring it doesn’t create disproportionate burden relative to the benefits that it aims to achieve.

Due diligence, basic selection criteria and exclusions

The basic selection criteria under PSR 23 refer to the minimum requirements that a provider must meet to be considered suitable for delivering a health care service and cover things like:

• The provider’s suitability to pursue a particular activity – Where the provider is required to possess a particular authorisation or be a member of a particular organisation in order to be able to perform the required services, the ICB may require a provider to prove that they hold such authorisation or membership (for example CQC registration).
• The provider’s economic and financial standing – The ICB may impose requirements ensuring that the provider possesses the necessary economic and financial capacity to perform the contract.
• The provider’s technical and professional ability – The relevant authority may impose requirements ensuring that a provider possesses the necessary human and technical resources and experience to perform the contract to an appropriate quality standard.

The ICB will aim to ensure that providers meet these basic standards before considering them further under the relevant provider selection regime processes (Direct Award Process C, Most Suitable Provider Process and the Competitive Process) but will avoid adding irrelevant or excessive barriers. ICB qualification processes will aim to be proportionate and focused on the suitability to deliver the health care service in question. For avoidance of doubt, the ICB are not required to apply the basic selection criteria when following direct award processes, A or B, or when awarding a Call-Off contract based on a framework agreement. However counter fraud guidance around due diligence suggests this should still be considered if proportionate or where there has been significant changes to a company e.g. a change to the structure of the company.

The rules on provider exclusions and debarment

The rules on provider exclusions are set out in Regulation 20 to 20C. Reporting of excluded providers to the debarment list is set out in Regulation 20D.

Unless Regulation 20(1A) applies, the ICB will not award a contract to an excluded provider or select an excluded provider to be party to a framework agreement, and must exclude a provider from any of the PSR 23 processes, if the provider or their subcontractor meets the exclusion criteria detailed in Regulation 20 and 20A. A provider may offer evidence that it has taken measures to demonstrate its reliability despite meeting a criterion for exclusion; if the ICB considers these measures to be sufficient, it will not exclude the provider. If the ICB does not consider the measures to be sufficient, it will respond to the provider with a statement of the reasons for this decision.

On an exceptional basis, the ICB may award a contract to a provider that is excluded where there is no other choice of provider and there are overriding reasons relating to the public interest, including public health.

Where a provider wishes to use an excluded provider as a subcontractor for some or all of the services in a procurement, the ICB will exclude the provider and the subcontractor from the procurement. Before excluding the provider, unless the exclusion is for reasons of a threat to national security, the ICB will inform the provider that it plans to exclude it and give the provider an opportunity to identify an alternative subcontractor. Where there are national security concerns, the ICB will seek agreement from the National Security Unit for Procurement prior to excluding the provider.

The ICB will report certain exclusions to the Procurement Review Unit which will consider whether to add the provider to the debarment list. This is where both:

• a provider is excluded from a procurement on the grounds that they are an excluded provider.

• the ICB considers that the circumstances giving rise to this exclusion will continue.

Decision making under PSR 23

The PSR 23 decision-making processes are set out in Regulation 6.

The PSR 23 must be applied whenever the ICB are making decisions about awarding contracts for health care services. As there is no maximum contract value threshold, this process applies to all and any level of spend for health-care contracts that fall within PSR 23. Therefore, there is no applicable ‘waiver’ option, one of these processes must be deemed the correct one to follow.

It is likely in most cases that the ICB will not be able to make a robust assessment of which Process is appropriate without first updating its ‘Provider Landscape’ knowledge via market analysis/engagement and other commercial interventions to gather intelligence to inform the decision. This can be undertaken various ways, including but not limited to:

Desk top research using the internet and other intelligence available to the ICB such as existing and previous contracts held by the ICB or neighbouring Authorities for the requirement or similar requirements.

Using the Central Digital Platform (‘Find a Tender’) to search for recent contract award notices and explore what providers have been awarded contracts for the requirement over a period of time.

Speaking with providers in the market (not just the incumbent/existing provider) to understand their legal/financial/professional/technical capabilities and capacities.

Using intelligence from Framework Agreements available online to identify providers on specific Lots, to explore likely market for a specific requirement and / or similar requirements.

Commercial interventions and tools such as SWOT (Strengths, Weaknesses, Opportunities Threats), PESTLE (Political, Economic, Social, Technological, Legal and Environmental), Porters 5 Forces, to look at the market dynamics and other driving forces that impact and influence providers in a particular market and its implication on the ICB as a ‘buyer.’

The ICBs Procurement Advisors can support relevant individuals with this work to develop an appropriate procurement strategy and route to market that is compliant, and evidence based.

The first step for the ICB applying the PSR 23 is to identify which of the following provider selection processes are applicable. [(A summary checklist is available at Appendix 2)]

Direct award process A

Direct award process A must be used when all of the following apply:

• There is an existing provider of the health care services to which the proposed contracting arrangements relate.
• The ICB is satisfied that the health care services to which the proposed contracting arrangements relate are capable of being provided only by the existing provider (or group of providers) due to the nature of the health care services.
• Direct award process A must not be used to conclude a framework agreement.

Direct award process B

Direct award process B must be used when all of the following apply:

• The proposed contracting arrangements relate to health care services in respect of which a patient is offered a choice of provider.
• The number of providers is not restricted by the relevant authority.
• The ICB will offer contracts to all providers to whom an award can be made because they meet all requirements in relation to the provision of the health care services to patients.
• The ICB has arrangements in place to enable providers to express an interest in providing the health care services.
• Where the ICB are required to offer choice to patients under regulation 39 of the National Health Service Commissioning Board and Clinical Commissioning Groups (Responsibilities and Standing Rules) Regulations 2012, they cannot restrict the number of providers and therefore direct award process B must be followed.
• Direct award process B must not be used to conclude a framework agreement.

Direct award process C

Direct award process C may be used when all of the following apply:

• The ICB is not required to follow direct award processes A or B.
• The term of an existing contract is due to expire, and the ICB proposes a new contract to replace that existing contract at the end of its term.
• The proposed contracting arrangements are not changing considerably.
• The ICB is of the view that the existing provider (or group of providers) is satisfying the existing contract and will likely satisfy the proposed contract to a sufficient standard.
• Direct award process C must not be used to conclude a framework agreement.

Considerable change threshold (DAP C application)

• Under PSR 23 there is a specific rule about when changes to an existing healthcare services contract are so significant that they trigger the need to start a new procurement process. This is called the “considerable change” threshold, and it’s explained in Regulation 14 of the PSR 23.
• A new procurement must be carried out if a proposed change to a contract is so substantial that it would make the contract materially different in character from the one originally awarded.
• The PSR 23 defines a considerable change as one that increases the value of the contract by 25% or more, or by more than £500,000 — whichever is lower.

Most suitable provider process

The most suitable provider process may be used when all of the following apply:

• The ICB is not required to follow direct award processes A or B.
• The ICB cannot or does not wish to follow direct award process C.
• The ICB is of the view, taking into account likely providers and all relevant information available to the ICB at the time, that it is likely to be able to identify the most suitable provider (without running a competitive process).
• The most suitable provider process must not be used to conclude a framework agreement.

Competitive process

• The competitive process must be used when all of the following apply:
• The ICB is not required to follow direct award processes A or B.
• The ICB cannot or does not wish to follow direct award process C and cannot or does not wish to follow the most suitable provider process.
• The competitive process must be used if the ICB wishes to conclude a framework agreement.

Once the ICB has identified which of these circumstances applies and has identified the appropriate provider selection process to follow, it will then need to follow that provider selection process as set out in detail in the sections below.

The ICB are expected to identify which provider selection process is applicable sufficiently in advance of a contract coming to an end. The fact that a particular decision-making approach was used to select a provider in the past does not mean the same approach must be used for that service in future.

The ICB is permitted to make certain modifications during the term of a contract to allow for changes to services or circumstances. 

In limited circumstances the ICB may need to act rapidly, for example, to address immediate risks to patient or public safety, within which it would be impractical to follow the steps required under the PSR 23. The section on urgent awards or contract modifications sets out these circumstances and how the ICB must act if they arise

Key criteria

The ICB must consider five key criteria when applying direct award process C, the most suitable provider process or the competitive process. These are:

Quality and innovation, that is the need to ensure good quality services and the need to support the potential for the development and implementation of new or significantly improved services or processes that will improve the delivery of health care or health outcomes, value, that is the need to strive to achieve good value in terms of the balance of costs, overall benefits and the financial implications of a proposed contracting arrangement, integration, collaboration and service sustainability, that is the extent to which services can be provided in:

1. an integrated way (including with other health care services, health-related services or social care services),
2. a collaborative way (including with providers and with persons providing health-related services or social care services), and
3. (a sustainable way (which includes the stability of good quality health care services or service continuity of health care services)
4. so as to improve health outcomes,
5. improving access, reducing health inequalities and facilitating choice, that is ensuring accessibility to services and treatments for all eligible patients, improving health inequalities and ensuring that patients have choice in respect of their health care, and
6. social value, that is whether what is proposed might improve economic, social and environmental well-being in the geographical area relevant to a proposed contracting arrangement. Authorities must assess how providers will deliver wider social outcomes, such as supporting local employment, reducing health inequalities, and improving community well-being. The focus is on aligning provider selection with NHS and local authority priorities, including population health and sustainability.

Application of key criteria

The ICB must consider each of the key criteria in the PSR 23 when making decisions under direct award process C, the most suitable provider process and the competitive process (including when concluding a framework agreement and when awarding a contract based on a framework agreement using the competitive process). Under these processes, the ICB must be able to justify their decisions when following a provider selection process in relation to the key criteria and keep a record of this. Further detail on recording decision-making and transparency can be found in the transparency section.

How the ICB assess providers against the key criteria, including what evidence they consider, may vary according to the service they want to procure. The ICB may wish to address specific priorities; these are expected to be described as part of the key criteria and can be considered when deciding the relative importance of the key criteria.

When developing the specification, the relevant authority should build the five Key Criteria into the service requirements and desired outcomes. This ensures:

The evaluation criteria are directly linked to what is specified.

The process remains transparent, fair, and proportionate, and the authority can demonstrate how decisions support the statutory aims under PSR 23.

The ICB must be aware that equalities duties in the Equality Act 2010, including the Public Sector Equality Duty, are relevant to all criteria and due regard to these requirements must be given when considering each criterion.

Balancing the key criteria

The relative importance of the key criteria is not predetermined by the PSR 23 or this guidance and there is no prescribed hierarchy or weighting for each criterion. The ICB must decide the relative importance of the key criteria for each decision they make under the PSR 23, based on the proposed contracting arrangements and what they are seeking to achieve from them/the services, including scenarios where a particular criterion is ‘pass/fail’, or where certain key criteria are of equal importance. All criteria must be considered, and none is expected to be discounted when following a provider selection process.

The PSR 23 does not specify how the ICB must balance the key criteria; however, the ICB are expected be aware of wider requirements or duties when considering procurement decisions. For example, NHS England, ICBs, NHS trusts and NHS foundation trusts are expected to adhere to NHS England’s net zero ambitions and its social value commitment, and the need to ensure value for money when arranging health care services (this list is not exhaustive). The flexibilities offered by the PSR 23 do not mean that the ICB are exempt from complying with their other obligations.

The ICB are advised to consider particularly carefully the relative importance of the value criterion when making assessments under the most suitable provider process.

It is advised that for provider selection processes with higher contract values, greater focus is given to value for money and the quality and efficiency of the services to be provided, unless this means the service does not best meet the needs of the population it is serving.

When making assessments against the key criteria under direct award process C and the most suitable provider process, the ICB are expected to use information and evidence from a range of sources, as well as their knowledge and experience of working with providers. They can ask providers for further information to assist with this assessment if they wish. The explanation of each criterion in Annex D includes examples of relevant sources where appropriate.

When following the competitive process, the ICB must only use the information contained in the bid to assess the bid. The ICB may set out in their tender documents that wilful misrepresentation of a bid by a provider will result in exclusion from the provider selection process.

The ICB must justify and record how they have given relative importance to each of the key criteria for the service they are arranging. Further detail on recording decision-making can be found in the transparency section.

The ICB must ensure they meet other relevant statutory duties when deciding the relative importance of each of the criteria, including normal public law decision-making principles around reasonableness of decisions. The ICB are also expected to consider other national and local policies and non-statutory guidance when deciding the relative importance of each of the criteria.

Keeping records of decision-making

The relevant information requirements are detailed in Regulation 24.

The ICB must make and keep clear records detailing their decision-making process and rationale. This must be done for all provider selection processes (direct award process A, B and C, the most suitable provider process, and the competitive process), when concluding a framework agreement, when awarding a contract based on a framework agreement without competition, and when awarding a contract based on a framework agreement following the competitive process. This includes where a provider selection process was abandoned or where the ICB decided to return to an earlier step in the process. Records must include:

• name of the provider to which the contract has been awarded or the name of any provider who is a party to a framework agreement and the address of their registered office or principal place of business.
• the decision-making process followed to select a provider(s), including details of the procedure used when the competitive process is followed.
• the reasons for these decisions
• details of the individual/individuals making the decision
• any declared or potential conflicts of interest for individuals involved in decision-making and how these were managed.
• where a procurement is abandoned, the date on which it is abandoned.

We expect that records are kept when contracting for mixed procurements, including how the procurement meets the requirements for mixed procurements under the PSR 23.

Records kept under Direct Award Process C

When following direct award process C or the most suitable provider process, records must also include:

A description of the way in which the key criteria (e.g., weighting, hierarchy, or more informal description of importance) were taken into account, and how the basic selection criteria were assessed when making decisions. We expect that this includes the relative importance of the key criteria that the ICB used to make a decision, the rationale for the relative importance of the key criteria, and the rationale for choosing the provider with reference to the key criteria.

Records kept under the Competitive Process

When following the competitive process (including when concluding a framework agreement or when awarding a contract based on a framework agreement following the competitive process), records must also include:

A description of the way in which the key criteria were taken into account, the basic selection criteria were assessed, and contract or framework award criteria were evaluated when making a decision. We expect that this includes the relative importance of the key criteria that the ICB used to make a decision, the rationale for the relative importance of the key criteria, and the rationale for choosing the provider with reference to the key criteria.

Records kept when concluding a Framework Agreement

When concluding a framework agreement, we expect that records include the terms and conditions that will be laid down by the framework agreement and include which the ICB are part of the framework agreement. When awarding a contract from a framework agreement, we expect that records include which framework agreement the contract is being awarded from.

The ICB must be aware that they may need to disclose information on the rationale for their decision making under the PSR 23 if a representation is made (see standstill period). We expect the ICB to keep their records for a period of time that is in line with their organisation’s record keeping policies and any applicable legislation.

The ICB are also expected to keep records of their decisions and decision-making processes when modifying a contract.

Records kept in urgent circumstances

Keeping records of decision-making in urgent circumstances

When awarding or modifying a contract in an urgent circumstance, the ICB must make and keep clear records detailing their decision-making process and rationale. Records must include:

• justification for using the urgent circumstances exemption.
• name of the provider(s) to which the contract has been awarded and the address of its registered office or principal place of business.
• the approach taken to select a provider and the process followed (i.e., urgent circumstance)
• details of the individual/individuals making the decision
• any declared or potential conflicts of interest of individuals making the decision (not including individual names) and how these were managed.

We expect that records are kept when contracting for mixed procurements, including how the procurement meets the requirements for mixed procurements under the PSR 23.

Annual summary

1. The annual summary requirements are set out in Regulation 25.
2. The ICB must publish a summary of their application of the PSR 23 annually online (e.g., via the ICB’s annual reports or annual governance statement). We expect the first annual summary to relate to contracts awarded using the PSR 23 between 1 January 2024 – 31 March 2025, and we expect this to be published no later than six months following the end of 2024/2025 financial year. 
3. Following the first annual summary, all other annual summaries must be published no later than six months following the end of the financial year it relates to.
4. This must include, in the year to which the summary relates, the:

• number of contracts directly awarded under direct award processes A, B or C
• number of contracts awarded under the most suitable provider process.
• number of contracts awarded under the competitive process.
• number of framework agreements concluded.
• number of contracts awarded based on a framework agreement.
• number of urgent contracts awarded and urgent modifications (in line with the urgent awards or contract modifications section)
• number of new providers awarded contracts.
• number of providers who ceased to hold any contracts with the ICB.
• details of representations received, including:
• the number of representations received in writing and during the standstill period in accordance with Regulation 12(3)
• summary of the outcome of all representations received and of the nature and impact of those representations.

In addition, the ICB are expected to publish:

• total number of providers the ICB is currently contracted with.
• details of any PSR review panel reviews:
• number of requests for consideration received by the PSR review panel.
• number of requests accepted and rejected by the PSR review panel for consideration.
• number of times where the PSR review panel advised the ICB to re-run or go back to an earlier step in a provider selection process under the PSR 23, and the number of times the advice was followed.

Monitoring requirements

The monitoring requirements are set out in Regulation 26.

The ICB must monitor their compliance with the PSR 23. The results of the monitoring must be published online annually (and may be integrated into other annual reporting requirements) and include processes, decisions made under the PSR 23, contract modifications, and declaration and management of conflicts of interests. The ICB may use internal auditors to fulfil these requirements.

If a compliance report finds instance(s) of non-compliance, the ICB must put in place actions to address this issue and to improve adherence with the PSR 23.

Reviewing decisions during the standstill period

The standstill period requirements, including for the reviewing of decisions, are detailed in Regulations 12 and 14(3). Provision for independent expert advice is set out in Regulation 23 (see the section on the PSR review panel) – this includes how the PSR Review Panel may provide advice during the standstill period.

This section explains how certain decisions made under the PSR 23 can be reviewed during the standstill period before they are finalised, and how a contract is awarded under certain procedures.

What is the standstill period?

The standstill period must be observed once a notice of intention to make an award to a provider under direct award process C, the most suitable provider process, or the competitive process has been published. This includes concluding a framework agreement or awarding a contract based on a framework agreement following a mini competition.

The standstill period follows a decision to select a provider and must end before the contract can be awarded. It gives time for any provider who might otherwise have been a provider of the services to which the contract relates to make representations; and for the ICB to consider those representations and respond as appropriate. See the section below on receiving representations for further details.

The standstill period must last for a minimum period of eight working days, during which time representations can be made. If any representations are received during this period, then the standstill period will remain open until the ICB provides any requested information, considers the representations, and makes a further decision.

The ICB are expected to be aware of the process and timeline for the review of decisions under the PSR 23 and are expected to plan the arrangement of services accordingly. They are expected to ensure that the review of the decision-making process can be completed, and a new contract awarded, before the existing contract ends.

When does the stand still period end?

The standstill period starts the day after the publication of an intention to award a contract. Representations must be received before midnight on the eighth working day of the standstill period.

The standstill period will end at midnight on the eighth working day, if:

• no representations are received by midnight on the eighth working day, or
• representations do not meet the required conditions (set out below).

Where representations meeting the required conditions are received, the standstill period continues until the ICB:

• completes its review.
• communicates its further decision (with reasons) to the provider who submitted the representations and to the provider to whom it intended at the beginning of the standstill period to award the contract to
• concludes it is ready to award the contract, or that it wishes to return to an earlier step in the process or abandon the process.

The end of the standstill period must be at least five working days after the ICB has communicated its decision to the provider. The minimum five working days’ notice allows for providers that remain unsatisfied about the response given by a ICB to their representations to seek the involvement of the PSR review panel (see PSR review panel section below).

Where the ICB’s decision is to award the contract (rather than return to an earlier step in the process or abandon the process), the standstill period should end when the ICB concludes it is ready to award the contract and there has been at least five working days since the ICB communicated its further decision. Where within five working days of receiving the ICB’s further decision, the provider requests an independent review from the PSR review panel, the standstill period should continue, other than in exceptional circumstances. See the PSR review panel section for further details on its process and how to request a review.

In this situation, if the PSR review panel accepts the request, the standstill period should not end until the ICB makes a further decision having considered the advice provided by the PSR review panel. The ICB must again give at least five working days’ notice of its further decision before the standstill period can come to an end and the ICB proceeds to take forward its further decision. 

The standstill period must end before a contract is awarded, and a confirmation of the decision is published (or before returning to an earlier step in the process or abandoning a process). The transition of services must only take place after the standstill period has ended, and the contract has been awarded.

Receiving representations

Providers may make a representation to the ICB within the first eight working days of the standstill period (i.e., starting from the day after the intention to award notice has been published). Providers cannot submit a representation after midnight of the eighth working day of the standstill period, even if the standstill period has been extended in response to a representation from another provider.

The purpose of making a representation is to seek a review of the decision made, to determine whether a ICB has applied the PSR 23 correctly and made an appropriate provider selection decision.

The ICB are only obliged to respond to representations that meet all the following conditions:

• the representation comes from a provider that might otherwise have been a provider of the services to which the contract relates.
• the provider is aggrieved by the decision of the ICB.
• the provider believes that the ICB has failed to apply the PSR 23 correctly and is able to set out reasonable grounds to support its belief.
• the representation is submitted in writing (which includes electronically) to the ICB within eight working days of the start of the standstill period.

When awarding a contract based on a framework agreement, e.g., following a mini-competition, only providers that were party to the framework agreement and i) took part in the mini-competition but were unsuccessful, or ii) were excluded from the mini-competition, may make a representation to the ICB.

If they wish, the ICB may also respond to representations that do not meet the conditions above.

The ICB must follow the relevant transparency requirements for the approach they take and must keep internal records of their decision-making Considering representations.

The ICB should ensure that appropriate internal governance mechanisms are in place to deal with representations made against provider selection decisions. To this end, the ICB should, where possible, ensure that decisions are reviewed by individuals not involved in the original decision. Where this is not possible, the ICB should ensure that at least one individual not involved in the original decision is included in the review process.

If the ICB is considering representations on the same issue from multiple providers, it may consider these together if appropriate.

Where a representation is received within the eight working days, the ICB:

• Must ensure that the provider is afforded an opportunity to explain or clarify its representation(s) if these are not clear.
• Is expected to provide an indicative timeframe for when the representation might be considered by, and when the provider might reasonably expect a decision to be made.
• Must provide any information requested by the provider that the ICB is required to keep under the PSR 23 (see record keeping) as soon as possible, except where this:
• would prejudice the legitimate commercial interests of any person, including the ICB.
• might prejudice fair competition between providers.
• would otherwise be contrary to the public interest.
• Must review the evidence and information used to make the original decision, taking into account the representations made.
• Must consider whether the representation has merit (e.g., it identifies that the process has not been correctly followed or brings to light information that has a bearing on the decision reached).

The provider that made the representations is expected to respond promptly and concisely to questions from the ICB about the points it has made, and if it cannot respond within a reasonable timeframe then it is expected to provide a justification.

We expect the ICB to allow sufficient time and opportunity for the provider that made the representations to respond to questions from the ICB. In the event that the provider fails to respond/communicate, then it is for the ICB to decide whether to complete its assessment of the representations and communicate their decision to the provider.

Outcome of representations

Where the ICB finds that a representation has merit (e.g., it identifies that the process has not been followed correctly or brings to light information that has a bearing on the decision reached), it must further consider whether this impacts on the intention to award a contract to the selected provider. It must then decide whether to:

• enter into a contract or conclude the framework agreement as intended.
• go back to an earlier step in the selection process, either to the start of the process or to where a flaw was identified, rectify this, and repeat that step and subsequent steps.
• abandon the provider selection process.

The ICB must communicate the decision described above promptly and in writing, to:

• the provider that made the representation
• the provider to which the ICB intended at the beginning of the standstill period to award the contract, or all providers with which the ICB intended at the beginning of the standstill period to conclude the framework agreement.

The standstill period can only end once the ICB has reviewed its decision, shared its conclusion (in writing) with the relevant providers, and concluded that it is ready to award the contract, or that it’s going to return to an earlier step in the process, or abandon the process.

The ICB must allow at least five working days following the day on which they sent their response to the provider, before the standstill period comes to an end. This time allows the provider to consider the response of the ICB, seek further clarifications, and to consider whether to request a further review by the Independent Patient Choice and Procurement Panel (IPCPP). This time also allows the ICB to reconsider their decision and make any subsequent decisions if necessary. The ICB must communicate any such further decision in writing to the provider (as outlined above).

If a panel review is requested and accepted, then the standstill period would usually continue until after the IPCPP has given its advice and the ICB has made its further decision in light of that advice.

The Independent Patient Choice and Procurement review panel

NHS England has established the IPCPP to provide independent expert advice to the ICB with respect to the review of PSR 23 decisions during the standstill period.

If a provider remains unsatisfied about the response given by the ICB to their representations, then that provider may seek the involvement of the IPCPP. The IPCPP may consider whether the ICB complied with the PSR 23 and may provide advice to the ICB. The ICB will then make a further decision about how to proceed.

The Chair and the Panellists

The IPCPP Chair will preside over the IPCPP. 

Panellists will be independent experts who are made available by, or endorsed by, NHS England or the Secretary of State for Health and Social Care to provide advice relating to the ICB’s compliance with these Regulations. Panellists will be selected on the basis of having the relevant expertise, qualifications, or experience relating to the commissioning or procurement of health care services that enables them to carry out a review efficiently and effectively. Panellists must be able to offer an impartial and unbiased opinion, and they must not have any conflicts of interest in the provider selection process in question. This means that IPCPP members must not have, directly or indirectly, a financial, economic, or other personal interest that might be perceived to compromise their impartiality and independence in the context of the provider selection process in question. IPCPP members must recuse themselves from providing advice on any provider selection processes where they have a conflict of interest or a perceived conflict of interest.

Further detail on how the IPCPP will operate will be set out on the PSR website.

The IPCPP process

If a provider wishes to request the IPCPP to consider their representation further, then they must submit their request through the PSR website within five working days of receiving the ICB’s decision following the ICB’s review of their representation. If the provider submits a request for advice from the IPCPP, the ICB will be notified, and the ICB should:

• keep the standstill period open for the duration of the IPCPP’s review.
• make a further decision once it has considered the independent expert advice.

In exceptional circumstances, the ICB may conclude that it is necessary to enter into a new contract before the panel can complete its review and share its advice. In those circumstances, the ICB will note the advice of the panel for the next time they use the PSR 23 to arrange health care services.

Where multiple providers seek the involvement of the PSR review panel, in relation to the same provider selection process, the IPCPP may choose to address the points raised by each provider individually or consider all of the points together. The standstill period should continue until the last advice is provided (unless in exceptional circumstances).

If the provider does not submit their request to the IPCPP within the five working day period, or the IPCPP does not accept the request for advice, then at any point after the end of that period, the ICB can bring the standstill period to an end and proceed to award the contract to their chosen provider.

The IPCPP will set out acceptance criteria to assess whether a request should be reviewed, and prioritisation criteria to determine the priority/urgency of a particular case. The acceptance and prioritisation criteria will be published on the PSR website. 

Information requested by the IPCPP from the ICB for the purposes of offering advice, and provided by the ICB, does not breach any obligation of confidence owed by the ICB. However, it may be subject to restrictions on disclosure imposed by other pieces of legislation.

Where the IPCPP accepts a representation for review, it will endeavour to consider it and share advice, or a summary of its advice, with the provider and the ICB within 25 working days. However, this timeframe is indicative and contingent on the engagement and timely responses of the provider and the ICB throughout the review process.

The IPCPP will also publish its advice, or a summary of its advice.

Outcome of IPCPP

Once the ICB has considered the advice of the PSR review panel, it may make a further decision, to be its final decision, replacing the previous one, to either:

• enter into a contract or conclude the framework agreement as intended.
• go back to the start of the selection process or to the step where a flaw was identified, and repeat that step and subsequent steps (see repeating a step in a provider selection process), or
• abandon the procurement (see abandoning a provider selection process).

The ICB must share this further decision promptly, in writing, and with reasons, with the provider who made a representation and the provider to which the ICB intended, at the beginning of the standstill period, to award the contract. The ICB will set out the outcome and a full and transparent justification for their decision, and it is expected that this will include whether they changed their original decision as a result of the advice of the IPCPP. The ICB must wait at least five working days before concluding it is ready to award the contract and bring the standstill period to an end, or before it returns to an earlier step in the process, or before it abandons a process.

Modification of contracts and framework agreements during their term

The requirements for the modification of contracts or framework agreements during their term are detailed in Regulation 13.

Overview

There will be situations where contracts or framework agreements need to be modified to reflect/account for changes to services/circumstances during their term.

One aim of the PSR 23 is to avoid processes that only bring limited value to people who use the services. Therefore, the PSR 23 allows for certain modifications to be made to contracts or framework agreements during their term without reassessment of the existing provider.

Depending on circumstance, permitted modifications can be made without following a new provider selection process, but in some cases will require the publication of transparency notices.

Modifications, which make an existing contract or framework agreement materially different in character are not permitted under the PSR 23 and require a new provider selection process to be undertaken. Further information on permitted and not permitted modifications is given below.

The ICB are expected to consider this section in conjunction with the modifications (variations) provisions of the relevant contract or sub-contract (for example, the General Conditions of the NHS Standard Contract).

The provisions in this section must only be used for modification of contracts during their term and not to circumvent the PSR 23 when a contract ends and a new one needs to be awarded.

Permitted modifications

Under the PSR 23, some modifications are permitted and so do not require a new selection process.

• Modifications to contracts originally awarded under direct award process A or B:

• Where the original contract was awarded under direct award process A or B and the modification does not materially alter the character of the contract, then the modification is permitted.
• If that modification is attributable to a decision of the ICB and the cumulative change in the lifetime value of the contract since it was entered into is £500,000 or more, the modification is still permitted, but the ICB must publish a transparency notice.
• Modifications to contracts originally awarded under direct award process C, the most suitable provider process, or the competitive process.
• Where the original contract was awarded under direct award process C, the most suitable provider process, or the competitive process (including framework agreements), then modifications are permitted in the following instances:
• The modification is clearly and unambiguously provided for in the contract or framework agreement documents (i.e., the scope and nature of the potential change has been described in detail in the existing contract).
• The modification is solely a change in the identity of the provider due to succession into the position of provider following corporate changes (e.g., as the result of a corporate takeover, merger, acquisition or insolvency), and where the ICB is satisfied that the provider meets the basic selection criteria.
• The modification is made in response to external factors beyond the control of the ICB and the provider, including but not limited to changes in:
  • patient or service user volume
  • prices in accordance with a formula provided for in the contract documents (e.g., uplifts in prices published in the NHS Payment Scheme or index linking) which do not render the contract or framework agreement materially different in character.

If the ICB makes a permitted modification (to a contract that was originally awarded under direct award process C, the most suitable provider process, and the competitive process), it must publish a transparency notice where all the below apply:

• that modification is attributable to a decision of the ICB.
• the cumulative change in the lifetime value of the contract or framework agreement is £500,000 or more and this represents less than 25% of the lifetime value of the original contract or framework agreement since it was entered into or concluded.

To note contracts entered into before the commencement of the PSR 23 must be modified in line with this section.

Modifications that are not permitted

Modifications that make the existing contract or framework agreement materially different in character are not permitted under the PSR 23 without undertaking a new provider selection process. Modifications are also not permitted where:

• the decision to make the modification is attributable to the ICB and it represents (i) a cumulative change of 25% or more in the lifetime value of the original contract or framework agreement and (ii) £500,000 or more compared to the lifetime value of the original contract or framework agreement (when it was entered into).

In these cases, the ICB must follow the appropriate decision-making process to select a provider (or group of providers) for the substantially changed service.

Contract modifications in urgent situations

Contract modifications may need to be made urgently. In these circumstances the ICB must still be transparent about their decision-making. Details of what needs to be published in these situations and when can be found in the urgent awards or contract modifications sections.

Urgent awards or contract modifications

The requirements for an urgent award or contract modification are detailed in Regulations 14(1), 14(2), and 14(4).

There are limited occasions where the ICB may need to act urgently and award or modify contracts to address immediate risks to patient or public safety.

These circumstances include where:

• a new service needs to be arranged rapidly in an unforeseen emergency or local, regional or national crisis, e.g., to deal with a pandemic.
• urgent quality/safety concerns pose risks to patients or the public and necessitate rapid changes.
• an existing provider is suddenly unable to provide services under an existing contract (for example, a provider becomes insolvent or experiences a sudden lack of critical workforce) and a new provider needs to be found.

In urgent situations, the ICB may make the following decisions without following the steps required under the PSR 23:

• re-award contracts held by the existing provider(s)
• award contract(s) for new services
• award contract(s) for considerably changed services.
• make contract modifications (without limitation).

An urgent award or modification must only be made by a ICB when all the below apply:

• the award or modification must be made urgently.
• the reason for the urgency was not foreseeable by and is not attributable to the ICB.
• delaying the award of the contract to conduct a full application of the PSR 23 would be likely to pose a risk to patient or public safety.

The ICB must not use the urgent award or contract modification provisions in the PSR 23 if the urgency is attributable to the ICB not leaving sufficient time to make procurement decisions and run a provider selection process– poor planning is not an acceptable reason to use these provisions.

In these urgent circumstances, the ICB:

• Are expected to limit the contract term or contract modification term to that which is strictly necessary. This is advised to be long enough to address the urgent situation and to conduct a full application of the PSR 23 for that service at the earliest feasible opportunity. We anticipate that contracts awarded under Regulation 14 will have a duration of no longer than 12 months. If the duration is to be longer, the ICB must justify and record this decision.
• Must keep records of their decision-making, including a justification for using an urgent award. 

Must be transparent about their decision through issuing an urgent award notice the ICB may also make specific urgent modifications to extend the length of an existing contract during the standstill period if advice is being sought from the PSR 23 review panel, in accordance with Regulation 14(3).

Termination of contracts

The requirements for contract terminations are set out in Regulation 22.

The ICB must ensure that each contract awarded contains provisions enabling its termination by the ICB if:

• the contract has been subject to modifications that are not permitted under the PSR 23 (see contract modifications) without following a new provider selection process
• the provider, at the time of the contract award, should have been excluded from the procurement process in line with the exclusion criteria set out in Regulation 20.

The provisions allowing the termination of a contract may address how such terminations would take place, e.g., by setting out a notice for terminations and by addressing any consequential matters that may arise from that termination. If the contract does not contain specific provisions allowing the ICB to terminate on the grounds specified above, there is an implied term of any contract awarded under the PSR 23 that the ICB may do so by giving reasonable notice.

Non-healthcare goods and services

The Procurement Act 2023

Since the UK’s exit from the EU, the PA 23 has been introduced to drive significant reforms to public procurement, creating a more streamlined, transparent, and flexible system designed to enhance efficiency, encourage competition, and deliver value for public funds. The PA 23 , which received Royal Assent on 26 October 2023, replaces the existing Public Contract Regulations 2015 (PCR 15), and came into force on 24 February 2025. The new framework aims to simplify procurement processes, improve accessibility for suppliers—including small businesses and social enterprises—and foster innovation.

Main changes and benefits

The transformation of four sets of regulations into a simpler set of rules under PA 23 enhances clarity and consistency for contracting authorities across all sectors. This streamlining reduces complexity and supports a uniform approach to procurement, ensuring compliance is more straightforward and reducing administrative burdens.

The PA 23 and associated regulations introduce increased freedoms and flexibilities for contracting authorities to design procurement processes that are tailored to their specific needs. This adaptability allows procurement activities to be more effective in achieving organisational goals while aligning with both local and national strategic objectives.

By promoting greater transparency, the PA 23 facilitates easier access to market data and existing procurement routes, enabling contracting authorities to make informed decisions and develop robust procurement strategies. The increased visibility of procurement opportunities also benefits businesses, fostering competition and enhancing scrutiny over public spending.

The PA 23 reflects the government’s commitment to reducing barriers for Small and Medium Enterprises (SMEs) and VCSEs. By improving access to public contracts, whether directly or through supply chains, the PA 23 broadens the marketplace for contracting authorities and promotes innovation and diversity within public procurement.

The PA 23 introduces stronger provisions to exclude suppliers who are unfit to deliver public contracts, including those with histories of misconduct, corruption, or poor performance. This measure enhances the ability of contracting authorities to safeguard public interests, including protecting public funds, national security, the environment, and workers’ rights.

The PA 23 establishes a power to publish a National Procurement Policy Statement (NPPS) and a Wales Procurement Policy Statement (WPPS), which outline the government’s strategic priorities for public procurement, guiding both authorities and suppliers in delivering outcomes aligned with these priorities. Under Section 13 of the Procurement Act 2023, the NPPS now has a statutory footing. Contracting authorities must have regard to the National Procurement Policy Statement when carrying out procurement functions. This means:

It is a legally binding requirement to consider the priorities and principles set out in the NPPS when planning and conducting procurements.

Authorities must be able to demonstrate how they have had regard to it in procurement decisions (e.g. specification design, evaluation criteria, contract management).

Contracting authorities are required to consider the relevant NPPS/WPPS when conducting procurement activities, including setting award criteria. These policy statements will outline the government’s strategic priorities for public procurement, guiding both authorities and suppliers in delivering outcomes aligned with these priorities.

Existing arrangements (please also see Transitional Arrangements and Savings section)

Contracts awarded under previous regulations, such as the PCR 15, will remain valid under the PA 23. These contracts do not need to be retendered and will continue to be governed by the rules that were in place when they were awarded, until they expire or are terminated.

Procurement activities that commenced before the PA 23 came into force have continued under PCR 15. Only new procurement activities initiated after the PA 23 came into force must comply with the new regulatory framework, ensuring a smooth transition to the new rules.

Existing framework agreements established under PCR15 have continued to be used until their natural end date. Additionally, new call-offs made under these frameworks are not required to comply with the PA 23, provided that the framework itself was established before the PA 23 came into effect.

Modifications to existing contracts must align with the PCR 15 under which the contract was awarded. However, new contracts or substantial modifications to existing arrangements may trigger the application of the PA 23, requiring compliance with the new rules.

The scope of The Procurement Act is set out in Regulation 2(1)

• All entities that fall under the definition of “contracting authority” are subject to the rules set out in the PA 23, although some exemptions apply. 

Where the procurement is for non-healthcare services, the following must apply:

• All non-healthcare services contracts for the supply of Goods and Services with an anticipated value of more than £207,720 (inclusive of VAT), or threshold in place at the time of the procurement, over the life of the contract must be subject to a formal procurement, in accordance with The PA 23 and the Regulations 2024.
• For non-healthcare services the decision relating to where to advertise and who to invite to bid should be well reasoned and documented.

Procurement thresholds for non-healthcare goods and services

Up to £5,000 (inclusive of VAT)

• Quotations required: 2 verbal
• Process: The resulting requisition must be accompanied by an appropriately signed record of the quotations received.

£5,001–£50,000 (inclusive of VAT)

• Quotations required: 3 written
• Process: Based on a written specification or terms of reference prepared by, or on behalf of, the ICB with options.

£50,001–£207,719 (inclusive of VAT)

• Quotations required: At least 4 written
• Process: For non-healthcare goods and services such as digital apps, and / or IT services: Competitive Quote procedure with a written specification and a detailed option appraisal

Over £207,720 (inclusive of VAT)

• Quotations required: Not applicable
• Process: You must follow an appropriate procedure under the Procurement Act 2023 (open or competitive flexible). Seek support from the ICB’s Procurement Advisors regarding the appropriate procedure.

When The Procurement Act rules apply

The PA 23 applies to contracting authorities when they engage in procurement activities that meet certain criteria which includes:

Covered Procurement Thresholds – when the estimated value of a contract exceeds the financial thresholds specified in Schedule 1 of the PA 23. These thresholds are:

• £135,018for central government authorities procuring goods and services.
• £207,720 for sub-central authorities (e.g., local government, public sector bodies including ICB’s) procuring goods and services.
• £5,193,000for works contracts, applicable to both central and sub-central authorities

Types of Contracts – the PA 23 applies to the procurement of:

• Goods, services, and works contracts.
• Concession contracts, where suppliers are granted rights to operate public assets or provide services to the public.
• Framework agreements for the future purchase of goods, services, or works.

In the context of public healthcare, the PA 23 mainly applies to non-clinical healthcare contracts within public health organisations. For the ICB, this could include:

• Facilities Management
• Construction 
• IT Systems and Software (even digital applications / software being used by medical professionals, for the purpose of medical application during health service delivery is captured by the PA 23.)
• Professional Services
• Other non-clinical NHS services

Contracting Authorities – The PA 23 applies to contracting authorities as defined in Section 2 of the PA 23, which includes:

• Central government bodies (e.g., ministries, departments).
• Sub-central authorities, including local authorities, NHS bodies Including Integrated Care Boards, educational institutions, and other public sector organisations.
• Utilities operating in water, energy, transport, and postal sectors, where applicable.

New Procurement Procedures – The PA 23 applies to procurement procedures initiated after the PA 23 comes into force. Existing contracts and ongoing procurement processes that started under previous regulations remain governed by those regulations.

Exemptions – There are exemptions where the PA 23 does not apply, such as:

• Contracts for specific defence and security matters.
• Certain international agreements.
• Urgent contracts required for unforeseeable emergencies.

Selecting a procedure

The competitive tendering procedures under the regime have been simplified from several prescribed procedures under the PCR 15 (shown on the left-hand side in the diagram below) to two methods for conducting competition under the PA 23 (shown on the right-hand side in the diagram)

Open procedure

The Open Procedure is a single-stage fully competitive process where any supplier may submit a tender in response to a contract notice. It is designed to maximise competition and transparency by allowing all interested and capable suppliers to bid without prequalification. The contracting authority evaluates all tenders against published award criteria, and the contract is awarded to the most advantageous tender. The process is intended to be simple, inclusive, and efficient, particularly suited to straightforward procurements where prior supplier vetting is not required. 

Key Features:

• Invitation to Tender (ITT): All interested suppliers are invited to submit a bid in response to the published tender. The process is open to any supplier who meets the Conditions of Participation in the procurement documents. These are minimum requirements that suppliers must meet in order to be considered for award in this case.
• No Pre-Qualification Stage: There is no pre-qualification stage, meaning that all suppliers who meet the necessary requirements can submit a bid. This increases accessibility and reduces barriers to participation for smaller suppliers.
• Simplified Process: This procedure is ideal for less complex contracts or where the contracting authority has already clearly defined the scope of the contract and the requirements. It ensures efficient evaluation of submissions and can be used for both goods, services, and works contracts.
• Timelines: The timeline for submitting tenders must allow a reasonable period for suppliers to prepare their bids. The timescales for determining how long a supplier has to submit its tender (tendering period) are:
• 25 days where tenders are submitted by electronic means
• 10 days where a qualifying planned procurement notice has been published
• 10 days in a state of urgency where any other minimum timescale is impractical
• Transparency and Equal Treatment: Suppliers are treated equally, and the criteria for awarding a contract to suppliers are clearly stated in the tender documentation. The contracting authority must ensure clear communication and consistent treatment of all suppliers.

The Open Procedure is best used when thew contracting authority:

• Wants to Maximise Competition
• The market is broad and mature, with many capable suppliers.
• The authority wants to encourage new entrants, SMEs, or innovation through openness.

Has a well-defined requirement

• The specification is clear, stable, and easy to price upfront.
• There’s little or no need for negotiation or supplier input to shape the solution.

Does not require prior shortlisting

• All bidders will submit full tenders without a separate selection phase.
• The authority is confident it can manage and evaluate a potentially high number of bids.

Is running a low-to-moderate complexity procurement

• The goods, services or works are standard or routine (e.g. cleaning, office supplies, IT hardware).
• There’s limited customisation or variation in how the contract could be delivered.

Has suitable timescales

• There’s enough time for full tender submission and evaluation, but not so long as to justify a more flexible or staged procedure.

Competitive flexible procedure

The Competitive Flexible Procedure is designed to be more flexible and adaptable than the Open Procedure. It allows contracting authorities to engage with suppliers during the procurement process, offering more flexibility in how bids are submitted and negotiated.

Key Features:

• Dialogue and / or negotiation with Suppliers: The Competitive Flexible Procedure permits dialogue and negotiation with suppliers throughout the process. Authorities may enter into discussions with suppliers to refine or clarify aspects of their proposals, ensuring that the final bid submitted best meets the authority’s needs.
• More Complex Contracts: This procedure is suited for more complex contracts where the contracting authority needs to explore different approaches or solutions to meet specific requirements. It is particularly useful for innovative or highly technical procurements.
• Phased Process: The process may involve multiple stages where suppliers are invited to submit initial proposals, followed by further refinements or clarifications. The contracting authority may request revised bids or alternative solutions as the process evolves.
• Evaluation Flexibility: The evaluation criteria in the Competitive Flexible Procedure may evolve based on discussions with suppliers, allowing authorities to adapt to changing circumstances or needs. This flexibility helps authorities to achieve better value for money by allowing suppliers to propose more tailored solutions.
• Negotiation: Unlike the Open Procedure, where the terms are fixed from the outset, the Competitive Flexible Procedure allows for negotiations on both price and contract terms. This flexibility is particularly useful when contract requirements are not fully defined or require custom solutions.

The Competitive Flexible Procedure is best used when:

The requirement is complex or evolving

• The solution cannot be fully defined at the outset.
• The specification may benefit from market input or innovation.
• Multiple delivery models or commercial approaches are possible.

Supplier engagement or dialogue is needed

• The authority wants to explore different approaches or refine specifications through discussions with shortlisted suppliers.
• There is a need to clarify, negotiate, or adapt proposals before final award.

The market is limited or specialised

• There are few capable providers, or it is a niche market.
• A more selective approach helps focus effort on the most suitable bidders.

High value or risk

• The contract is high-value, long-term, or strategically sensitive.
• Mistakes or poor design could lead to significant delivery risk or waste.

The authority needs flexibility in process design

• The procurement needs to include stages like initial solution assessment, negotiation, or BAFO (best and final offer).
• The authority wants to control the pace, structure, and level of engagement during the process.

Comparison of the Open and Competitive Flexible Procedures.

Direct award

The PA 23 introduces provisions for direct award in special cases, replacing the Negotiated Procedure without Prior Publication from the PCR 2015. Contracting authorities should only consider direct awards if one or more specific grounds are met and after exploring whether a competitive tendering procedure (either Open Procedure or Competitive Flexible Procedure) is more appropriate and feasible, even under reduced timelines due to urgency or other exemptions.

Grounds for direct award:

There are limited circumstances in which a contracting authority is permitted to award a public contract to a supplier without first running a competitive tendering procedure. These are provided for in section 41 and referred to as ‘direct award justifications. 

Under Schedule 5 of the PA 23, a direct award may be used for the following scenarios:

• Prototypes and Development: The contract involves creating prototypes or novel goods/services for testing, research, or development purposes.
• Single Supplier t: The goods, services, or works can only be supplied by a specific supplier due to technical reasons, intellectual property, or exclusive rights. This also includes contracts for creating or acquiring unique artistic works. Additionally, due to an absence of competition for technical reasons and provided there are no reasonable alternatives, only a particular supplier can supply the goods, services or works required.
• Commodities: The contract relates to goods purchased on the commodity market.
• Advantageous Terms due to Insolvency: A supplier undergoing insolvency proceedings offers terms that are particularly advantageous.
• Urgency: A strict requirement for goods, services, or works exists due to extreme urgency, making a competitive procedure unfeasible. The urgency must stem from circumstances unforeseen by the contracting authority.
• Additional or repeat goods, services or works: a direct award may be used for repeat contracts or additional works from the same supplier, where a change of supplier is not reasonably practicable, and the change would cause a) disproportionate technical difficulties in operation or maintenance, or b) substantial duplication of cost for the authority. This is often referred to as the “technical or economic interchangeability” exemption.

Additionally, a second justifications is outlines where a contract has previously been awarded under a competitive tendering procedure and the tender notice or tender documents set out that the intention was to carry out a subsequent procurement of similar goods, services or works by direct award. Broadly speaking, the direct award must be made within 5 years of the original competitively tendered contract being awarded (see Schedule 5, paragraph 8(a) for the precise time limit).

Direct award should only be employed in limited, well-justified situations after all competitive options have been explored. The use of direct awards must always comply with the specific grounds outlined in the PA 23 and be transparent, justifiable, and in the public interest.

Transparency requirements

Under previous regulations, contracting authorities were required to publish notices throughout the procurement process to communicate new opportunities, contract awards, and changes. These notices were key to ensuring transparency.

The PA 23 maintains the requirement for publishing notices but introduces key changes:

• New notices now cover all stages of the procurement lifecycle, including contract management.
• Notices must be published in a single place, the central digital platform (potentially through existing eSender portals).
• Commercial data must be included in these notices, providing valuable insights to aid in procurement strategy design and delivery.
• Understanding these new publication requirements from the outset will help ensure timely and efficient procurement processes.

Transparency notice requirements (UK Procurement)

UK1 – Pipeline notice

• Requirement: Mandatory (for organisations with £100m+ annual spend)
• 18-month forward look at planned procurements valued at £2m+

UK2 – Preliminary Market Engagement notice

• Requirement: Mandatory where engagement is anticipated or has taken place (or explain in tender notice why it hasn’t been published).

UK3 – Planned procurement notice

• Requirement: Optional and Best Practice.
• Advises the market of an upcoming procurement. A qualifying planned procurement notice can reduce tender timescales.

UK4 – Tender notice

Including to establish a framework and below-threshold notices

• Requirement: Mandatory (for a competitive procedure)
• Publish when undertaking an open or competitive flexible procedure (including to establish a framework contract and procuring using a dynamic market (1)) or procuring a regulated below-threshold contract.

UK5 – Transparency notice

• Requirement: Mandatory (for a direct reward)
• Publish prior to award when undertaking a direct award.

UK6 – Contract notice award

• Requirement: Mandatory
• Publish to communicate the outcome of the procurement and to commence the standstill period prior to awarding a contract under the open or competitive flexible procedure (and voluntary standstill periods for direct awards).

UK7 – Contract details notice

• Requirement: Mandatory
• Publish details of the awarded contract (including the contract, for public contracts £5m+), inc. regulated below-threshold contracts above a certain value and those procured by direct award.

UK8 – Contract payment notice (1)

• Requirement: Mandatory
• Publish details of payments over £30,000 made under a public contract (quarterly).

UK9 – Contract performance notice

• Requirement: Mandatory
• Publish KPI scores for public contracts £5m+ (at least annually). Publish within 30 days of supplier poor performance/ breach of contract.

UK10 – Contract change notice

• Requirement: Mandatory
• Publish prior to a qualifying modification taking place, inc., for contracts exceeding £5 million, publication of modification.

UK11 – Contract termination notice

• Requirement: Mandatory
• Publish when a public contract us terminated/ comes to an end.

UK12 – Procurement termination notice

• Requirement: Mandatory
• Publish where, after publishing a tender or transparency notice, the process is terminated without awarding a contract.

UK13 to 16 – Dynamic market notices

• Requirement: Mandatory
• Publish and update when advertising, establishing, changing or terminating a dynamic market (inc. utilities dynamic markets and qualifying utilities dynamic markets).

UK17 – Payment’s compliance notice

• Requirement: Mandatory
• Publish details of performance against 30-day payment terms (twice annually).

Transitional and Saving Arrangements

Transitional and saving arrangements are set out in the regulations which determine how the changeover from the previous legislation to the PA 23 is managed and effected by contracting authorities. They determine how procurements which straddle the implementation date of the PA 23 are to be carried out and which legislation applies. The intent is that the implementation of the PA 23 will cause as little disruption as possible for procurements which are already underway, and contracts which have already been awarded, when the PA 23 comes into force.

Legal Framework Governing the Transitional and Saving Arrangements

The transitional and saving arrangements will be set out in regulations made under the powers set out in sections 122(3)(d) and 127(2) of the PA 23.

These regulations, the PA 23 (Commencement No. 3 and Transitional and Saving Provisions) (Amendment) Regulations 2024, set out the rules for which legislation applies to ongoing procurements and contracts awarded under the previous legislation, which determine how those procurements and contracts are to be managed.

Key Points and Policy Intent

The fundamental principle is that procurements that commence after the entry into force of the PA 23 must be conducted by reference to PA 23 only, whilst those that were commenced under the previous legislation PCR 15 ( Public Contract Regulations 2015), the UCR 16 (Utilities Contract Regulations 2016),  the CCR 16 (Concession Contract Regulations 2016) and the DSPCR 11  (The Defence and Security Public Contract Regulations 2011) must continue to be procured and managed under that legislation.

Any contracts awarded under the previous legislation will continue to be managed under that legislation until such a time as the contract, or commercial tool (see paragraph 18 below), ceases to exist. This means that in respect of modifications, for example, contracting authorities can only modify contracts awarded under the previous legislation using provisions set out at regulation 72 of the PCR 15, regulation 88 of the UCR 16 and regulation 43 of the CCR 16 as appropriate. Contract management includes only using the noticing pertaining to the previous legislation. For example, since the PA 23 came into force any contracts awarded under the PCR 15 that has been modified in accordance with regulation 72 of the PCR 15 would have required publication of a modification notice in accordance with regulations 51 and 72 of the PCR 15 must be published (on find a tender service or contracts finder as required) and not a contract change notice (under section 75 of the PA 23).

Procurements, including those that would result in a below-threshold contract, that have been commenced under the previous legislation will continue to be procured, and any resulting contracts or contracts already awarded will continue to be managed (which includes modified and terminated) under the previous legislation until:

• a. the end of the contract (for whatever reason) that is awarded under the previous legislation (including contracts that have had valid extensions).
• b. where no contract is awarded, the procurement process ends (i.e. where the procurement does not result in the award of a contract – for example, because the contracting authority has discontinued the procurement).
• c. where it is a framework agreement, the end (for whatever reason) of the last contract awarded under the framework agreement during the term of the framework arrangement.
• d. where it is a dynamic purchasing system, the end (for whatever reason) of the last contract awarded under the dynamic purchasing system during the term of the dynamic purchasing system; or
• e. where it is a qualification system, the end (for whatever reason) of the last contract awarded under the qualification system within the term of the qualification system, or where it has an unlimited duration, the end (for whatever reason) of the last contract awarded before the termination of the qualification system.

In respect of qualification system, the organisations that set up the qualification system are encouraged to terminate it as follows (although no later than 23rd February 2029, when all qualification system must end):

• a. where the qualification system is used for the procurement of a specific programme or project (e.g. building and operating a nuclear reactor), the qualification system should be terminated when the programme or project comes to a natural end; or 
• b. where the qualification system is currently used for general utilities procurement, the qualification system should be terminated after a fair and reasonable period.

For the purposes of the previous legislation, a competitive procurement is ‘commenced’ when:

• a. before 26th May 2023 a PIN was used as a call for competition by a sub-central contracting authority; or
• b. a contract notice 
• has been submitted to be published under the previous legislation; or
• c. a below-threshold contract opportunity is published under the PCR 15 (see regulation 110); or
• d. utilities notice on the existence of a qualification system that acts as a call for competition is published under the UCR 16(see regulations 44(4)(b), 68 and 77); or
• e. a sub-contract notice has been submitted to be published under the DSPCR 11 (see regulation 42(1)).

Negotiated procedure without prior publication (‘direct award’) procurements commenced under the previous legislation

Where a contracting authority has contacted a supplier with the intention of entering into a contract with it under any of the following provisions, the procurement is deemed to have been commenced for the purposes of the transitional and saving provisions and the relevant previous legislation will continue to apply:

• a. regulation 32 of the PCR 15.
• b. regulation 50 of the UCR 16; or
• c. regulation 16 of the DSPCR 11.

This means if a contracting authority signalled its intent to enter into a contract with a supplier without prior publication of a contract notice, then it can continue to negotiate that contract under the previous legislation that was in place when the intention to award the contract was given. Prior publication of a voluntary transparency notice would be a clear and public signal of intent in this respect, but it is not the only means by which this intent may have been communicated. This is consistent with the position on competitive procurements.

Pipeline Notices

A pipeline notice sets out the forthcoming procurements of a contracting authority. While best practice (and a policy requirement for central government), there is no obligation in the previous legislation for contracting authorities to publish a pipeline notice. The PA 23 includes an obligation (in section 93) on contracting authorities who anticipate spending more than £100 million under ‘relevant contracts ‘in the coming financial year to publish a pipeline notice. That notice must list all public contracts with an estimated value of more than £2 million for which the contracting authority anticipates publishing a tender notice or transparency notice in the coming 18 months starting with the first day of the financial year. 

Where a public contract has been included on a ‘non-statutory’ pipeline notice before section 93 comes into force, but as at the date the PA 23 comes into force the procurement for that public contract has not yet ‘commenced’ as described in this guidance, the procurement must be carried out under the PA 23. It should also be noted that a contracting authority’s statutory obligation to publish a pipeline notice will only arise from the 1st April which follows section 93 coming into force (i.e. from 1st April 2025) and will need to include all forthcoming procurements which fall within the requirements of section 93 irrespective of whether the procurement was included in a previous non-statutory pipeline notice or not.

Prior information notice/periodic indicative notice

Under the previous legislation, contracting authorities could publish their potential forthcoming procurements via the use of a prior information notice (under the PCR, DSPCR or CCR) or a periodic indicative notice (under the UCRs), collectively referred to as ‘PINs’. PINs have also been used for the purposes of preliminary market engagement.

Unless used as a call for competition by a sub-central contracting authority prior to 26th May 2023, the publication of a PIN under the previous legislation, whether used for preliminary market engagement or not, is not one of the commencement trigger notices referred to at paragraph 8 above. This means that where a PIN has been published before the PA 23 comes into force, but none of the other circumstances in paragraph 8 apply, the procurement must be carried out under the PA 23 and not the previous legislation. 

However, where a PIN has been used for preliminary market engagement, this engagement and the PIN can be relied on as part of a procurement under the PA 23 and a preliminary market engagement notice would not have to be published under section 17 of the PA 23. Under section 17 of the PA 23, where preliminary market engagement has been carried out a contracting authority is required to publish a preliminary market engagement notice before publishing a tender notice, or provide reasons for not doing so. The fact that the preliminary market engagement was carried out via a PIN under the previous legislation can be used as the reason to justify why a preliminary market engagement notice has not been published under section 17, even though preliminary market engagement has been carried out. 

This would require the contracting authority to state when publishing a tender notice that a preliminary market engagement notice was not published because the preliminary market engagement was undertaken, and notice of it provided in a PIN, prior to the PA 23 coming into force. 

If a contracting authority wishes to shorten the tendering period (as permitted by section 54 of the PA 23) then a planned procurement notice will need to be published enough time in advance of the tender notice to become a qualifying planned procurement notice (see guidance on the planned procurement notice for more information), regardless of whether or not a PIN was issued under the previous legislation.

Commercial Tools

Any contracts awarded through a framework agreement, dynamic purchasing system or qualification system (referred to as ‘commercial tools’) under the previous legislation will continue to be managed in accordance with that legislation. For example, a call-off contract awarded under a framework agreement set up under the PCR will continue to require publication of the relevant notices for that framework under the PCR until the call-off contract is terminated (for whatever reason), even if the framework itself has ended. 

The transitional and saving regulations set out that any dynamic purchasing system and qualification system established under the previous legislation must come to an end as set out when they were established, or by 23rd February 2029 (four years after the new regime comes into effect), whichever is earlier. Any contract awarded under such an arrangement will continue until it comes to an end and be managed by the previous legislation (even if the dynamic purchasing system or qualification system has terminated prior to that point).

The regulations restrict the ability to extend a dynamic purchasing system or qualification system awarded under the previous legislation (see, for example, as might arise under PCR regulation 34(28)) by providing that any dynamic purchasing system or qualification system extended after the PA 23 comes into force can only be extended in the first twelve months after the PA 23 comes into force and cannot be extended beyond 23rd February 2029.

There will be a transition period during which contracting authorities may be able to award contracts under commercial tools set up under both regimes. Therefore, contracting authorities should also ensure that any decision on which commercial tool is to be used and the associated rationale is fully documented before commencing the procurement.

Payments compliance notice 

The obligations in the PA 23 in relation to the payments compliance notice only apply to contracts awarded under the PA 23.

Where the PCRs apply to a contract, contracting authorities’ publishing requirements under regulation 113(7) PCR continue to apply as they do currently, except that the reporting period will transition to every six months under the transitional and saving provisions.

Key Performance Indicators (KPIs)

The obligations in the PA 23 relating to KPIs only apply to contracts awarded under the PA 23. Contracting authorities are not required by the PA 23 to set or publish KPIs for contracts that were awarded under the previous legislation, even where those contracts are above the threshold set out in section 52 of the PA 23.

Under the Procurement Act 2023 (PA23), Key Performance Indicators (KPIs) for contracts exceeding £5 million (including VAT) must be published at least annually, and upon contract termination, in a Contract Performance Notice (CPN). These notices detail the supplier’s performance against the selected KPIs, assessed at the time of publication.

Direct award for additional works and services relating to contracts awarded under the previous legislation

The transitional and saving regulations make provision for the use of the direct award ground set out in Schedule 5, paragraph 8 of the PA 23 for contracts awarded under the previous legislation in very specific circumstances. Schedule 5, paragraph 8 allows for the direct award of a contract for additional works and services from a supplier with whom the contracting authority already has a contract (provided it was awarded under a competitive tendering procedure) provided that intention was set out in the tender notice or tender documentation for the original contract. 

This ground broadly replicates a similar ground in the previous legislation (at PCR regulation 32(9-12), DSPCR regulation 16(1)(d)(ii) and 16(6), and UCR regulation 50(1)(f) and 50(4)). In order to preserve the expectation when these contracts were awarded under one of the competitive procedures in the previous legislation that such additional works and services could be procured at a later date through direct award, the transitional and saving regulations permit contracting authorities to use the ground at Schedule 5, paragraph 8 where they can demonstrate compliance with the relevant requirements of the previous legislation, including that the contracting authority has set out its intention to rely on the right to make a direct award in this way before it entered into the original contract.

Awards under the PA 23

Contracting authorities wishing to carry out a ‘covered procurement’ (see section 1 and guidance on covered procurement) or a procurement for a regulated below-threshold contract in accordance with Part 6 of the PA 23 (see guidance on below-threshold contracts), and have not yet ‘commenced’ the procurement in accordance with the transitional and saving provisions must conduct the procurement in accordance with the PA 23. 

Any contracting authority intending to carry out a procurement soon after the PA 23 comes into force will need to consider the provisions in the PA 23 when planning that procurement, even though the PA 23 may not be in force during the planning process. For example, this would mean ensuring that the procurement is in compliance with all obligations contained in the PA 23 in relation to, for example, obligations with regard to the national priorities in the NPPS, procurement objectives, conflicts of interest, record-keeping, KPIs etc., even if this requires the contracting authority to take steps prior to the PA 23 coming into force to ensure compliance.

• ‘Contract notice’ in this document includes ‘Contract notice’ (regulation 49 PCR and 69 UCR), ‘Contract notice for contracts in the field of defence and security’ (regulations 17-19 DSPCR), ‘Concession notice’ (regulation 31 CCR), ‘Design contest notice’ (regulation 79 PCR). ↩
• ‘relevant contracts’ are defined in section 93(4) as ‘any contracts for the supply of goods, services or works to the contracting authority other than exempted contracts.

Other Procurement Principles

Splitting or disaggregation of contracts 

There shall be no splitting of procurements simply to avoid the application of a fuller procurement process.

False quotations and tenders and bid rigging.

For procurements under the Public Procurement threshold, the ICB will have the right to use its discretion in deciding which individuals or companies should be invited to bid. To minimise fraud:

• Suppliers should be selected from an approved list (where available) according to predetermined and justifiable criteria.
• The use of negotiated or restricted tendering should be justified.
• The time and date for the return of tenders will be specified at the outset.
• Invitations to submit quotes or tenders will be retained. This will include all correspondence with potential suppliers.
• Bids will be received within the required timeframe.
• Exceptional decisions to include bids submitted after the deadline must be justified in writing.
• A record of quotes/tenders should be maintained, including the names of contractors and the number of tenders submitted by each.
• An e-procurement system may be used.

Bid rigging occurs when bidders agree among themselves to eliminate competition in the procurement process, thereby denying the public a fair price. The ICB will undertake relevant checks to assist in detection of false tenders or quotes.

Any concerns identified during the procurement process relating to fraud or bribery shall be brought to the attention of the Local Counter Fraud Specialist or the NHS Counter Fraud Authority either via the NHS Fraud Reporting Line 0800 028 4060 or online https://cfa.nhs.uk/reportfraud 

Collaboration

The ICB is committed to operating in a sustainable environment where all opportunities for efficiencies and economies of scale are considered and applied where applicable. This includes the sharing of operational resources or a commitment to specific joint projects/contracts across the East of England footprint for example, where this serves the best interest of the system population. The move towards further integration will necessitate the development of new types of contracts for accountable care and stewardship models and the ICB will follow guidance from NHS England and Improvement on their application.

Grants  

Where VCSEs support healthcare related provision, the ICB may elect to provide funding through a grant agreement. Use of grants can be considered where:

• The ICB is only making a partial contribution to the costs of delivering a project (e.g., it is also supported by or other funding streams).
• Funding is provided for development or strategic purposes.
• The provider market is not well developed.
• The services are innovative or experimental.
• Where funding is non-contestable (i.e., only one provider).

Grants must not be used to avoid competition where it is appropriate for a formal procurement to be undertaken. Where relevant, the ICB will undertake a mini competition to identify the most suitable organisation.

The ICB may procure the services of a third party to run a grant application and award process for specific projects however normal procurement rules shall apply to secure services of the third party.

The ICB shall follow NHS England and Improvement Grant Agreement Guidance on the use of the model Grant Funding Agreement although it is non-mandatory and is for local adaptation as required.

Spot Purchasing

Spot purchasing occurs when there is an immediate, recognised requirement and a decision must be made “on the spot”, reactively and without time to plan. At these times, a competitive process may be waived using the same process described in this policy and the reason for it must be recorded and reported to the ICB Audit, Risk and Compliance Committee.

Spot purchasing must not be used as a ‘business as usual’ process and any resultant agreements must undergo ongoing best value reviews to ensure that the ICB is receiving value for money. 

Approval of spot purchase agreements should follow the ICB Scheme of Reservation and Delegation. In all cases the ICB should ensure that the provider is fit for purpose to provide the service, and process must follow UK Public Procurement rules.

Joint Procurements

Where a joint procurement is to be pursued by two or more ICBs, or 2 or more stakeholders within an ICS, then the procurement must be underpinned by a Memorandum of Understanding and a Collaborative Agreement between the parties that will, as a minimum, set out:

1. the objectives of the procurement, 
2. identify which ICB will act as the lead, 
3. the approvals and reporting processes, 
4. roles and responsibilities within the project, 
5. how legal costs will be shared, 
6. how risks and benefits are shared
7. dispute resolution arrangements and 
8. exit arrangements from the procurement.

Record Keeping

All decisions shall be documented, including a clear rationale for the choices made.

National Policy and Guidance

Cabinet Office Guidelines

The ICB must comply with Cabinet Office policy and guidance by publishing all tender opportunities and contract awards over £30,000 on Find a Tender service. This obligation only arises if the authority has advertised the contract opportunity elsewhere (e.g., on its website).

NHS Constitution

The NHS will have to ensure that any of its procurement activities or market interventions take account of the provision of the Constitution and any associated Department of Health and Social Care (DHSC) policies and guidance documents. 

ICB obligations in respect of Section 256 Agreements

The ICB must meet several conditions when making a grant under a Section 256, which are set out in the NHS (Conditions Relating to Grant Payments by NHS Bodies to Local Authorities) Directions 2013:

• the ICB is satisfied that the payment is likely to secure a more effective use of public funds than the deployment of an equivalent amount on the provision of health services.
• where the grant payment is to meet all or part of the capital costs of a project, the grant amount must be determined before the project begins.
• where the grant payment will be used by the local authority to fund part of a project, the ICB must be satisfied that the local authority intends to meet the remaining costs of the project. The ICB must also be satisfied that this will continue for as long as both the ICB and the local authority consider the project to be necessary or desirable. 
• the ICB must ensure, so far as is practicable, that the payment is used by the local authority in such a way as will secure the most efficient and effective use of the amount paid.
• if, during the course of the grant period, the local authority reduces the level of service it provides below the level originally agreed then the ICB may reduce accordingly the amount of any further payments so far as is practicable to ensure that the payment is used by local authority in such a way as will secure the most efficient and effective use of the amount paid.
• the ICB will react to this requirement by ensuring it has the capacity and specialist resource to enable it to make the most appropriate decision to meet the contingent circumstance through procurement management and best practice processes.

Other Payment Arrangements the ICB may use

The NHS Act 2006 makes provision for payments to be made between local authorities and NHS bodies. It also makes provision for payments to be made to other specified bodies, including voluntary organisations and Local Health Boards. These Directions ensure that any such payments are subject to common conditions concerning financial management. Procurement Management and Best Practice

These conditions apply to any payments made using section 75 76. 256 and 257 of the NHS Act 2006. This includes the money to be transferred by NHS England, as specified in the Directions entitled “The National Health Service Commissioning Board (Payments to Local Authorities) Directions 2013” as well as any further payments which have been agreed at a local level.

Section 76 payments may be made by local authorities to the NHS England), ICB’s or Local Health Boards, and section 256/257 payments may be made by NHS England or ICB’s to local authorities, voluntary organisations and other bodies specified in the NHS Act 2006.

Section 257 of the NHS Act 2006 as amended 2022 allows for NHS England or an Integrated Care Board to make payments to a Voluntary Organisation in connection with services provided by a voluntary organisation 

This also allows for Local Authorities who have received funds under section 256 may make out funds to voluntary organisations via S257 agreement.

Section 75 of the NHS Act 2006 allows partners (NHS bodies and councils) to contribute to a common fund which can be used to commission health or social care related services. 

This power allows a local authority to commission health services and NHS commissioners to commission social care. It enables joint commissioning and commissioning of integrated services.

Section 76 of the NHS Act 2006 as amended 2022 allows local authorities to make payments to (NHS bodies and councils) in connection with its mandated functions. 

This power allows a local authority to commission health services and NHS commissioners to commission social care. It enables joint commissioning and commissioning of integrated services.

E-procurement

The ICB will use e-procurement systems for above threshold public procurements so that the various stages of the procurement process including the decision-making process are transparent and auditable.

Procurement Planning

Each procurement will have a robust procurement project plan setting out key roles and responsibilities, the outcome of risk assessments and plans to address identified risks. A review of current service provision should be undertaken at least 6 months prior to the expiry of a contract to determine the appropriate procurement actions required.

Using the Correct Contract 

All staff must ensure the correct use of contract to procure services in line with DHSC and NHS England guidance, including use of the appropriate NHS contract and terms and conditions for the service being procured e.g. NHS Standard Contract or relevant Primary Care Contract.

The ICB may wish to obtain legal support with completing schedules within the NHS standard contracts and/or constructing bespoke contracts. Unless using a recognised framework agreement.  

Post-Procurement Monitoring

Contract management and post-procurement review are mandatory features of the post contract award stage and will require effective monitoring systems to be implemented. This is key to managing risk.

Monitoring Compliance

The ICB Board shall be responsible for approving this policy which will be reviewed at least annually. 

The ICB Executive Director of Finance and Commercial Officer shall be responsible for monitoring operational compliance with this Policy on a day-to-day basis, through support from the ICB Contracting Team and ICB Procurement Advisors.

The ICB Audit, Risk and Compliance Committee shall be responsible for monitoring compliance with this Policy through regular review of the Register of Procurement Decisions and through regular review of all non-compliant procurement routes used with support from ICB Procurement Advisors.

Implementation and Staff Training

All staff, and others working with the ICB, must read and understand this Policy, comply with it and be aware of its implications. It is not intended that staff will develop procurement expertise; however, they will need to know when and how to seek further support.

The most urgent requirement is that all staff throughout the ICB should know enough about procurement to know to seek help when they encounter related issues; they must also be able to give clear and consistent messages to providers and potential providers about ICB procurement intentions in relation to individual service developments.

The ICB has access to contracting and procurement advice through the ICB Contracting Team and ICB Procurement Advisors to ensure the law, appropriate regulation, internal governance and process is adhered to.

Arrangements for Review

This policy will be reviewed no less frequently than every two years. An earlier review will be carried out in the event of any relevant changes in legislation, national policy or guidance, organisational change or other circumstances which mean the policy needs to be reviewed.

If only minor changes are required, the sponsoring Committee has authority to make these changes without referral to the ICB Governing Body. If more significant or substantial changes are required, the policy will need to be ratified by the relevant committee before final approval by the Integrated Care Board Governing Body.

Associated Policies, Guidance and Documents

Associated Policies

• 004 Accounting and Financial Management
• 012 Records Management and Information Lifecycle Policy
• 018 Conflicts of Interest, Gifts, Hospitality and Commercial Sponsorship Policy
• 022 Legal Services Policy
• 026 Counter-Fraud, Bribery and Corruption Policy
• 032 Health Inequalities Impact Assessment Policy and Guidance
• 062 Complaints, Compliments and Concerns Management Policy
• 088 Decision Making Policy and Procedure

Other Key Guidance

Equality and Health Inequalities Assessment 

Any procurement conducted by the ICB must consider and adhere to the Equality Act (2010). This Act requires commissioners not to discriminate on any grounds against any potential provider. Potential providers will be treated in the same respect during stages of agreeing contracts and implementing contracts.

As part of the ICB’s consultation process an equality and health inequalities assessment must be undertaken at relevant stages in the procurement process to ensure that the proposed/planned changes are assessed with regard to impact on groups, individuals or communities. The outcomes of such equality impact assessments will be published by the ICB upon request and as part of its equality scheme.

Primary Care Impact Assessment

The Primary Care Impact Assessment (PCIA) should be applied to all procurements, to ensure primary care impact has been considered, this will avoid unnecessary unintended consequences and / or avoidable delays later in the programme.

The PCIA offers assurance that the ICB are gaining value for money and triggers consideration by the project team of the potential impact of the project/programme may have on Primary Care services, both negative and positive. It also checks to ensure any services proposed to move into primary care because of decisions made in the project/programme are within the core contract and that there is adequate funding to support it. 

Common breaches of procurement processes identified by the NHS Counter Fraud Authority (NHSCFA)

Breaches of procurement which occur because of suspected fraud and bribery must be reported to the ICB Local Counter Fraud Specialist or the NHS Counter Fraud Authority either via the NHS Fraud Reporting Line 0800 028 4060 or online via:

https://cfa.nhs.uk/fraud-prevention/reference-guide/cyber-enabled-fraud/reporting.

Freedom of Information Act 2000

The ICB will comply with requirements set out in the Freedom of Information Act (2000) while conducting procurements. On commencement of the procurement process the ICB will make potential bidders aware of the requirement for the ICB to comply with the PA 23. 

Public Services (Social Value) Act 2012

Under both PA 23 and PSR 23, contracting authorities must consider social value, but the PA 23 links it to services procurement via the Social Value Act 2012, while the PSR 23 embeds it as a core decision-making principle for health care contracts.

Under both regimes, contracting authorities must ensure social value considerations are proportionate, relevant, and clearly linked to the contract’s subject matter.

Implementation of the SVA includes pre-procurement consideration of how the ICB can improve social, economic, and environmental well-being in the area where the contract is being performed, and how the ICB might act to secure those improvements.

The ICB is committed to reducing environmental impacts and supporting the Greener NHS delivery of a ‘net zero carbon’ health service. Our procurement process will include a ‘Net Zero Carbon’ expectation/ask in line with relevant national guidance and strategy.

Register of Procurement Decisions and Contracts Awarded. 

The register is owned by ICB Procurement Advisors and, subject to amended national guidance, shall be published on the ICB website no less than four (4) times per year.

Equality impact assessment

The EIA has identified no equality issues with this policy. 

The EIA has been included as Appendix A.

Appendix A – Equality impact assessment

Initial information

Name of policy: F001 Procurement and Contracting Policy
Directorate/Service: Resources Directorate
Version number (if relevant): V1.0
Assessor’s Name and Job Title: Victoria Sawtell- Director of Commercial
Date: 20/08/2025

Outcomes

Evidence

Analysis of impact on equality

The Public Sector Equality Duty requires us to eliminate discrimination, advance equality of opportunity and foster good relations with protected groups.   Consider how this policy / service will achieve these aims.  

N.B. In some cases it is legal to treat people differently (objective justification).

• Positive outcome – the policy/service eliminates discrimination, advances equality of opportunity and fosters good relations with protected groups.
• Negative outcome – protected group(s) could be disadvantaged or discriminated against
• Neutral outcome – there is no effect currently on protected groups.

Please tick to show if outcome is likely to be positive, negative, or neutral.  Consider direct and indirect discrimination, harassment, and victimisation.

Monitoring outcomes

Monitoring is an ongoing process to check outcomes.  It is different from a formal review which takes place at pre-agreed intervals.

Review

Appendix B – Correct provider selection regime process checklist