The UK Government has issued a new National Procurement Policy Statement (NPPS), which came into effect on 24 February 2025 alongside the Procurement Act 2023
This new policy sets out strategic priorities that all public sector buyers must consider when spending public funds through procurement activities.
The NPPS aims to modernise and improve how the public sector delivers value through procurement. It introduces a clear framework to help contracting authorities, including government departments, local councils, and public bodies, focus on achieving value for money in a way that supports broader national goals.
More value-driven spending
Under the new rules, contracting authorities are now required to “have regard” to the NPPS when making procurement decisions, unless a specific exemption applies. This means the NPPS must be a key consideration throughout the procurement process and integrated into planning, decision-making, and delivery.
At the heart of the NPPS are three core pathways that aim to help buyers maximise value for public spending:
- Driving Economic Growth: Public procurement is encouraged to support local and national economic development actively. This includes engaging with small and medium-sized enterprises (SMEs) and voluntary, community, and social enterprise (VCSE) suppliers, helping to stimulate competition and innovation.
- Delivering Social and Economic Value: Contracting authorities are expected to consider the wider impact of their procurement decisions, such as contributing to environmental sustainability, tackling modern slavery, and creating social benefits in communities. Initiatives like reducing carbon emissions and promoting equality and diversity can be key components of this focus area.
- Building Commercial Capability: Public sector organisations should aim to improve procurement skills, tools, and systems. This includes identifying training opportunities, developing stronger commercial expertise within teams, and ensuring efficient and resilient procurement processes.
These goals are not meant to overburden buyers or create unrealistic expectations. Instead, authorities are encouraged to apply them appropriately to the contract’s size and nature. For example, smaller contracts may only require minimal additional considerations, while larger or more complex procurements might justify a more detailed approach.
The next steps for public sector buyers
Buyers should review their current procurement strategies and policies to meet the new requirements. This may involve updating action plans to increase engagement with SMEs and VCSEs, revisiting environmental and ethical standards such as carbon reduction or modern slavery policies, and assessing opportunities to improve team capability through training or restructuring.
Decision-makers, not just procurement staff, are encouraged to understand the NPPS and how it affects their role. Strategic leadership should ensure the NPPS is embedded in organisational planning and procurement governance structures.
The government has made it clear that demonstrating alignment with the NPPS is important. Contracting authorities should document how they have considered the NPPS in each procurement process, including any trade-offs or practical limitations they faced.
