
There is no doubt that public sector procurement is changing. The seeds that were sewn by the Construction Playbook in 2020 and nurtured by “Constructing the Gold Standard” are ready to flower with the forthcoming Procurement Act.
Now set to come into force in February 2025 following a delay, the focus on best practice is now more intense than ever – as it should be when it comes to how public funds are spent.
Transparency in procurement has always been a priority in how we manage frameworks at Pagabo, but the market is now catching up, with wider discussions around frameworks referencing these points at an ever-increasing pace.
Equally, due diligence has also been critical but the forthcoming legislation changes is highlighting an ever-greater need for it than ever before. Due diligence is needed from all parties, including the framework provider and agent to ensure that procurement best practice is being adhered to – and processes are robust under the glare of scrutiny.
In the wider context of a built environment that has had a series of challenges to face since the 2020 pandemic, this level of transparency, trust and expertise is as important now as it has ever been – and those in the procurement industry need to remain alert to this and act accordingly.
What is a contracting authority?
The term contracting authority refers to any entity that has an obligation to carry out procurement processes under public procurement regulations, such as local authorities and NHS trusts.
Under the Procurement Act 2023, contracting authorities are defined as a public authority, public undertaking, or private utility that is subject to the rules of the Act.
- Public Authorities: An entity that is wholly or mainly publicly-funded, or subject to a public authority oversight, including the Common Council of the City of London.
- Public Undertaking: An entity that is subject to public law.
- Private Utility: An entity that carries out a utility activity.
What is the difference between an agent and a third-party framework?
These terminologies refer to whether a framework has been established by an agent acting on behalf of a contracting authority or a private organisation establishing a framework independently.
The Procurement Act 2023 (Act) defines a framework as a: ‘contract between a contracting authority and one or more suppliers that provides for the future award of contracts by a contracting authority to the supplier or suppliers’. A non-contracting authority would have to be acting as the agent of the named contracting authority if it sets up and administers the framework.
The term ‘agent’ has been introduced within the framework guidance produced by the Cabinet Office and the new terminology adds clarity to the role that organisations like Pagabo occupy, compliantly setting up and administering frameworks on behalf of a named contracting authority or authorities.
As an agent, Pagabo is itself compliantly procured by contracting authority – sometimes referred to as the framework host – either by open tender or concession contract to procure and manage the frameworks on their behalf. This is a very important aspect for the agent, evidencing complete compliance throughout the process.
Contracting authorities remain the ‘legal owner’ and liable for their frameworks, and for frameworks that Pagabo act as an agent for, they remain actively involved in ongoing framework management, granting or declining all access agreements. Pagabo’s approach to this role is to support contracting authorities to compliantly procure via the framework.
A third-party framework is a framework established by a non-contracting authority that falls outside the scope of procurement regulations and therefore not compliant for use by contracting authorities.
What are the benefits of using an agent?
In short, the contracting authorities own their frameworks, with us stepping into a management role, meaning they can rely on us to ensure compliance, manage supplier relationships, and facilitate the delivery of procurement activity across the framework lifespan.
In our position as an agent, Pagabo provides the UK’s public sector with compliancy, efficiency, best practice assurance, and the best value procurement solutions – all backed by MCIPS and NEC4 PM accredited experts. This means contracting authorities can rest easy in the knowledge their frameworks are being managed in line with the latest market knowledge, and that learning is shared between the public and private sectors to provide the best outcomes.
We provide bespoke consultancy as part of the process, which leads to increased efficiencies along with a more flexible range of procurement options.
Procurement support that gives back to the public sector
As well as adhering with procurement legislation and guidance, contracting authorities across our portfolio then go on to benefit from a percentage of the usage income, which is directed straight back to them.
By utilising an agent like Pagabo, the contracting authority is therefore not only able to focus on their own operations, safe in the knowledge they have the expertise and compliance covered by its agent – it is then able to reinvest the funds into improving its services even further, or ringfencing them for specific use, often with a social value association.
This has seen £1.4m of usage fees returned to contracting authorities in 2024, supporting a number of initiatives including TEAL Be Well and the Red Kite Foundation.
With every penny in the public sector purse needing to go as far as possible, making sure that this reinvestment can happen is a vital part of what we do at Pagabo as an agent. This ties with our organisational focus on creating the maximum positive social value from our activities.
This differs from third-party framework offerings, which are run by and for themselves as limited companies, and as such, without that vital reinvestment into the public sector.
Why is this all important?
Bringing that market focus on transparency in line with our own – and there will be several changes within legislation to get to grips with to ensure continued compliance.
Due diligence will be ever more important too. It’s not just about the procurements call offs through a framework once live – it’s in the development and management of those frameworks for contracting authorities too. Therefore, it’s crucial that public sector bodies carry out their own due diligence on the frameworks providers they use, rather than just going with the flow.
Ultimately, just like the procurements going through them, frameworks themselves have to be robust when scrutinised, ensuring that best practice is met. Contracting authorities can be confident in the compliance, professionalism, efficiency, and value for money that comes from procuring Pagabo as an agent for their frameworks – all in line with the latest regulations and procedures needed.
Discover our frameworks