This announcement initiates a critical six-month preparation phase, urging contracting authorities and suppliers, including SMEs and VCSEs, to expedite the refinement of their operational processes and engage in requisite training to seamlessly adapt to the forthcoming changes.

In support of this preparation effort, IPEC has curated a comprehensive fact sheet with key training opportunities and resources currently available.

For assistance in selecting the most suitable learning options for your team, the Cabinet Office has prepared a Learning and Development brochure outlining all available support.

We trust this factsheet proves helpful in your preparations for the forthcoming Procurement Act changes. For any inquiries or guidance, please feel free to reach out to us at contact@ipec.org.uk.

As part of our work to realise the opportunities arising from over £300 billion annual UK public procurement spend, this week we participated in the first IPEC Research Symposium, organised by the Innovation Procurement Empowerment Centre at the amazing Alliance Manchester Business School. This brought together academics from leading universities across the UK – Manchester, Birmingham, Bath, Cardiff, Stirling, Nottingham, Oxford, Lancaster – and Autonomous University of Madrid. 30 speakers, researchers and policy leads convened to share evidence and ideas to boost the impact of innovation procurement.  

The Innovation Procurement Empowerment Centre (IPEC) is a major initiative of Connected Places Catapult and a key plank of our work is to develop research capacity in this critical area. We have entered a long-term partnership with the Universities of Birmingham City-REDI and the Manchester Institute of Innovation Research (University of Manchester), gathering evidence to build the case for doing procurement differently. It will generate tools for policy development and support public and private sectors in implementing innovation through procurement, driving investment and better outcomes.  

The Public Procurement as a Catalyst for Innovation workshop explored the impacts, measurement, and best practices of innovation procurement. Key themes that emerged include:

• The growing importance of evidencing how public procurement can drive innovation and address major challenges, while achieving efficiency and value for money. Academics from the University of Manchester presented research using advanced data analysis techniques like network analysis and AI language models to quantify the impact of innovation procurement on firm productivity and gain insights into complex public sector supply chains.

• The importance of taking a holistic, systems approach to procurement that considers the broader ecosystem of buyers, suppliers, and stakeholders. Research using administrative data from TED and Contract Finder in the UK demonstrated the value of clever data analysis in unlocking insights from existing procurement data sources.

• The potential for innovation procurement to drive positive local economic and social outcomes, such as supporting local businesses, creating jobs, and advancing sustainability goals. Examples included research conducted by researchers at City-REDI (University of Birmingham) on retrofitting social housing and the Catapult’s West Midlands Diatomic project.

• The need for cultural change, capacity building, and sharing of best practices to fully realise the potential of innovation procurement. While the new UK Procurement Act presents opportunities, challenges remain around data quality, skills, and embedding innovation across the commissioning lifecycle.

• The importance of collaborating across academia, government, and industry to build the evidence base for innovation procurement, champion success stories, and co-create practical tools and guidance. IPEC’s “Art of the Possible” report and ongoing research partnerships exemplify this approach.

Participants left energised to build on the momentum and partnerships from the workshop to position public procurement as a key catalyst for innovation and public good. Key next steps include improving data infrastructure, developing case studies and practical guidance, and fostering communities of practice to accelerate learning and adoption of innovation procurement practices.

Connected Places Catapult, the UK’s innovation accelerator for cities, transport, and place leadership, today published ‘The Art of the Possible in Public Procurement’ – a new report from the Innovation Procurement Empowerment Centre (IPEC). The report is co-authored by an expert team with experience in innovative legal and procurement processes and was unveiled at a House of Lords reception. It encourages council leaders, innovative teams in public authorities and ambitious businesses to take advantage of the new possibilities – reinforced by the Procurement Act 2023 – that can be used to drive innovation.

With approximately £300bn a year being spent on UK public procurement, public sector organisations have an indispensable role in fostering innovation and supporting ambitious small businesses. Local Government alone accounts for approximately £70bn of that spending which has huge potential to level-up economic growth and productivity in the UK.

The Procurement Act 2023 received royal assent on 26 October. In November, the Cabinet Office produced a guidance note ‘Transforming public procurement: our innovation ambition’ which outlined the intent that, ‘over time these developments will make public procurement into one of the most powerful levers to drive innovation nationally’. The authors of ‘The Art of the Possible’ set out ways in which this ambition can be achieved and how the new rules encourage more ways of engaging innovative companies during procurement processes. They highlight the importance of attracting innovative suppliers; cementing partnerships; ensuring transparency and value sharing; and transformative collaboration.

The report brings principles to life through case studies of procurement best practice, including:

• how TfL developed and incentivised a three-way partnership between carriers, innovators and themselves to reduce the adverse impact of freight with Freightlab;
• how Leicestershire Children’s Services used an innovative two-tier contractual framework to procure solutions that helped to achieve ambitious social and environmental goals;
• and how Staffordshire County Council used a joint tendering arrangement with neighbouring councils to increase their purchasing power and overcome their struggle securing a new sexual health service provider.

The report points to the introduction of the ‘competitive flexible procedure’ as the single biggest change implemented through the 2023 Act. The new procedure gives creative contractors a ‘wider palette of colours’ with which they can design procurement solutions. The authors also highlight the importance of assessment criteria favouring the ‘most advantageous tender’. They point to wording from the National Procurement Policy Statement, which is included in the Act. ‘All contracting authorities should consider the following national priority outcomes alongside any additional local priorities in their procurement activities:

• creating new businesses, new jobs, and new skills.
• tackling climate change and reducing waste, and
• improving supplier diversity, innovation, and resilience.’

Speaking at a reception at the House of Lords to mark the publication of the report, Rikesh Shah, Head of the Innovation Procurement Empowerment Centre at Connected Places Catapult said:

“The Procurement Act 2023 reinforces the ability of public authorities to get better value for money by getting smarter with their spending. In recent years, technology has changed at such a rapid rate that new types of innovators are emerging. This is creating a huge opportunity for public authorities to unlock value.

Every procurement made has the potential to support a new idea and generate new economic activity. By further empowering public authorities as they get smarter with spending, we can support more diverse suppliers and find more cost-effective, sometimes more localised, solutions to our biggest challenges.“

Malcolm Harbour CBE, Associate Director at Connected Places Catapult and former Chair of the powerful European Parliament Internal Market Committee, said:

“We all want public money to be well spent. But to maximise the power of every pound we need everyone involved in public procurement to show relentless ambition to enhance the impact of what they spend. We also need to have the courage to try new ways of doing things, and challenge suppliers to respond to procurement processes with fresh thinking.”

Mr Harbour, who was awarded the CBE for services to the British economy, continued,

“The very best procurement processes set challenging delivery targets, responding to national and regional priorities and stretching the innovative capability of suppliers.”

Read the full report here.

Innovation procurement is set to make a significant impact on the way the public sector operates. As an integral component of the recently passed Procurement Act, now is a great time for public bodies to gear up to implement Innovation Procurement.  The Innovation Procurement Empowerment Centre (IPEC), part of the Connected Places Catapult, has been established to support you and your colleagues in adopting these approaches.

IPEC has commissioned an independent research study to investigate the level of awareness, understanding and adoption of Innovation Procurement across public bodies. We have launched a confidential survey to gather the views of those working in the public sector, in order to inform the design of future support.

Please take 10 minutes out of your schedule to complete the survey and make your voice heard.

Head of Innovation Procurement Empowerment Centre – Rikesh Shah – explains how your expertise is essential in driving the necessary change in public sector: