Last edited 16 Dec 2020

Public contract

The overriding policy requirement for public contracts is that they must be based on value for money, defined as “the best mix of quality and effectiveness for the least outlay over the period of use of the goods or services bought”. Ref

Public contracts are subject to internationally and nationally agreed obligations and regulations that encourage value for money through open competition. This includes adopting the principles of:

EU public procurement directives are implemented in member states by national regulations. The Public Contracts Regulations 2015 implement parts of the 2014 EU Procurement Directives, defining the rules for purchasing of goods and services above certain price thresholds by public contracting authorities in the UK (implemented in Scotland through the Public Contract (Scotland) Regulations 2015).

A public contracting authority is defined in the Public Contracts Regulations 2015 as; ‘…the State, regional or local authorities, bodies governed by public law or associations formed by one or more such authorities or one or more such bodies governed by public law, and includes central government authorities, but does not include Her Majesty in her private capacity.’

For more information, see Public contracting authority.

Public projects must comply with the regulations if the value of contracts is above specified thresholds. Private projects may also be required to comply with the regulations if they are subsidised directly by public contracting authorities by more than 50%.

For more information see: OJEU procurement procedures.

The Social Value Act applies to all public services contracts (or framework agreements), and also to those public services contracts which include the purchase or hire of goods or the carrying out of works.

For more information see: Social Value Act.

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