Procurement Act 2023: What does the data tell us about direct awards?
29 Sep 2025
4 min read
One of the more significant changes introduced by the Procurement Act 2023 was a new obligation on contracting authorities to publish a notice in advance of making a direct award, to provide greater transparency of these awards to the market.
Just over six months on, the data available through Find a Tender* indicates that direct awards continue to be fairly well used (making up c.20% of advertised procurements), although generally for relatively low value awards (with 83% of awards having an estimated value of less than £1 million (incl. VAT)).
Background:
The PA23 came into force on 24 February 2025 and aimed to introduce a more transparent regime for direct awards in UK public procurement. The PA23 continues to allow direct awards (in line with the previous procurement regime), but clarifies and expands the grounds on which direct awards can be made, and introduces additional transparency around their use.
The PA23 provides 3 grounds on which a direct award can be made:
| Section 41: Direct award justifications | Section 42: Protection of life
| Section 43: Switching to direct award |
Available if one of the 13 justifications listed in Schedule 5 applies, e.g. technical reasons, urgency, insolvency, public interest.
| Available if a Minister temporarily designates contracts for direct award via secondary legislation to protect life, health, public order or safety (reflecting lessons from the Covid-19 pandemic). | Available if a competitive procedure fails to produce any suitable tenders. |
| TRANSPARENCY NOTICE REQUIRED | TRANSPARENCY NOTICE REQUIRED |
If the contracting authority can make a direct award under Section 41 or 43, then it must issue a transparency notice before the contract is awarded (and ideally as soon as the decision to directly award a contract is made). This notice must include an explanation of why the direct award is justified by reference to the grounds in the PA23. The issue of a transparency notice is required for almost all categories of direct award, except for user choice contracts.
The contracting authority must also issue a contract award notice before it enters into the directly awarded contract, and it is this notice which (in most cases) triggers a mandatory standstill period of 8 working days to allow time for challenge before the contract is signed.
Observations:
As of 26 September 2025, there have been 1954 transparency notices issued on Find a Tender, which accounts for 20% of advertised procurements.
The following table provides a breakdown by value and shows that the vast majority of direct awards are of contracts with an estimated value of less than £1 million. 37% of the notices relate to awards with an estimated value below the lowest threshold level (£139,688), despite there being no obligation to issue a notice in those cases.
High value direct awards are (not unexpectedly) relatively rare, with only 9 having a value of over £100 million, 7 of which are in the rail sector.
It’s clear from the data available that the parallel procurement regimes continue to cause some confusion - 355 Voluntary Transparency Notices (aka VEATs) have been issued under the old regime since 24 February 25, and at least some of those relate to procurements that should be governed by the PA23.
An interesting feature of the transparency notices issued to date is that the level of detail provided on the justification for the direct award varies dramatically – many simply state the ground that the authority is relying on with no accompanying justification. It will be interesting to see if this approach gives rise to challenge in the future, particularly in light of the high standards for the validity of notices set under the previous regime by both the CJEU in Fastweb and as applied by the Court of Appeal in Faraday.
It is also notable that some contracting authorities are opting to issue transparency notices for modifications to contracts procured under the previous regime, even though the Cabinet Office guidance makes clear that modifications of contracts procured under the previous regime should be governed by the previous regime only. These notices are commonly issued alongside a Voluntary Transparency Notice under the previous regime.
*All data as accurate as possible, although another observation is that the Find a Tender system remains a fairly blunt tool, and is unable to distinguish between (for example) notices issued under the PA23 and the Provider Selection Regime.
Contributors: Laura Wisdom (Partner), Katie Matthews (Trainee)
High value direct awards are relatively rare, with only 9 having a value of over £100 million, 7 of which are in the rail sector.