New Procurement Thresholds from January 2022

On 1 January 2022 new procurement thresholds were introduced by the UK government via the Public Procurement (Agreement on Government Procurement) (Thresholds) (Amendment) Regulations 2021.

The new regulations apply to all procurements that start on or after 1 January 2022 conducted under the Public Contracts Regulations 2015, the Concession Contracts Regulations 2016, the Utilities Contracts Regulations 2016 and the Defence and Security Public Contracts Regulations 2011.

The regulations deem that procurements must now be calculated inclusive of VAT. This effectively changes the financial thresholds applicable to public procurement, so for those contracts where VAT is applicable, the thresholds are now lower.

Due to the changes, more procurements will now have estimated values above the relevant thresholds. For these procurements contracting authorities now need to publish notices on the Government’s Find A Tender Service website and follow the fully regulated regime.

It should be noted that contracts that fall below the financial thresholds are not caught by the main regulations of the PCR 2015, but will still be subject to Regulation 110 PCR 2015. This requires that such contract opportunities over certain thresholds are to be advertised on Contracts Finder.

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