New Procurement Thresholds from 1 January 2026
From 1 January 2026, the procurement thresholds under the Procurement Act 2023, will be revised. The changes are implemented through the Procurement Act 2023 (Threshold Amounts) (Amendment) Regulations 2025, which amend Schedule 1 of the Act. The new thresholds apply to all new procurements commenced on or after 1 January 2026 but do not apply affect procurements already in train before that date.
Why are the Thresholds Changing?
PPN 023 reminds us that the thresholds at which public procurement opportunities become subject to the full regime are updated every two years to reflect currency fluctuations and ensure the UK complies with its obligations under the World Trade Organisation’s Agreement on Government Procurement (GPA). In addition, the threshold amounts for regulated below-threshold contracts and defence and security contracts are being amended to ensure consistency and alignment with the GPA.
For procurements starting on or after 1 January 2026, the thresholds (inclusive of VAT) set out in the table below will apply.
Practical takeaways
- Review upcoming procurements scheduled for early 2026. If the estimated contract value exceeds the new thresholds, you must follow the full procurement regime under the Procurement Act
- Ensure your procurement policies, templates, and training materials are updated to reflect the revised figures.
|
|
Type of Contract |
Threshold Amount |
|
1 |
Defence and security contract that is a works contract |
£5,193,000 |
|
2 |
Defence and security contract that is a concession contract |
£5,193,000 |
|
3 |
Defence and security contract not within row 1, 2 or 8 |
£415,440 |
|
4 |
Utilities contract that is a works contract |
£5,193,000 |
|
5 |
Utilities contract that is a light touch contract |
£884,720 |
|
6 |
Utilities contract not within row 3, 4 or 5 |
£415,440 |
|
7 |
Light touch contract that is a concession contract |
£5,372,609 |
|
8 |
Light touch contract not within row 5 or 7 |
£663,540 |
|
9 |
Concession contract not within row 2, 6 or 7 |
£5,193,000 |
|
10 |
Works contract not within row 1, 4 or 9 |
£5,193,000 |
|
11 |
Contract for goods, services or works to a central government authority not within any other row |
£135,018 |
|
12 |
Contract for goods, services or works to a sub-central government authority not within any other row |
£207,720 |
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