NHS faces digital and cultural shift as Procurement Act 2023 transforms supplier management

The Procurement Act 2023 is beginning to reshape how the NHS buys goods and services, but the real test is no longer the legislation itself. It is whether trusts can turn a more demanding compliance regime into a more intelligent way of managing spend, suppliers and performance. The new regime took effect on 24 February 2025, and the latest phase of obligations on transparency, payment reporting and contract performance has now broadened the scope of what public bodies must publish. (...

For the NHS, that matters more than for most parts of the public sector. NHS England says its commercial activity covers about £30 billion of spending across roughly 80,000 suppliers, making procurement one of the service’s biggest operational levers. The scale alone explains why the Act is being seen not simply as a legal update, but as a potential catalyst for wider reform. (england.nhs.uk)

The Government’s stated aim is to create a simpler and more transparent procurement system, with new procedures such as the Open Procedure and the Competitive Flexible Procedure designed to give contracting authorities more room to shape competitions around what they actually need. Officials have also emphasised a central digital platform, Find a Tender, as the main place for publishing notices and sharing supplier information. (legislation.gov.uk)

That digital shift is particularly important for NHS organisations, many of which still rely on fragmented records, manual workflows and legacy systems. NHS Shared Business Services has warned that the new rules require suppliers and buyers to work with far greater consistency, while also highlighting the move towards mandatory registration on the central digital platform and stronger reporting requirements. (sbs.nhs.uk)

The promise of transparency, however, runs deeper than simply uploading notices. Government guidance says the central platform is intended to make procurement information easier to find, compare and use, while the Act’s reporting framework now includes notices linked to contract details, contract performance and payments compliance. In practice, that means the NHS will need cleaner data, better integration between finance and procurement systems, and a more disciplined approach to contract management. (gov.uk)

That is where the biggest cultural challenge lies. Procurement teams are not being asked only to process purchases more efficiently; they are being asked to operate as strategic partners to clinical and finance leaders. NHS SBS says the reforms should also support social value and create more opportunities for small and medium-sized enterprises, but that depends on organisations being able to see and act on their spending patterns, supplier performance and compliance risks. (sbs.nhs.uk)

There is also a strong financial argument for change. NHS England says procurement is central to value for money and service resilience, and its commercial strategy links buying decisions to sustainability, productivity and patient outcomes. In that context, the Act’s emphasis on prompt payment, performance visibility and better supplier oversight could help trusts move from reactive administration to more proactive commercial management. (england.nhs.uk)

The next stage will depend on execution. The regulatory framework is now in place, but the NHS will only gain the full benefit if it combines digital capability with governance and cross-team collaboration. If trusts can use the new regime to connect data, strengthen supplier relationships and reduce wasted effort, procurement could become not just more compliant, but genuinely more effective. (gca.gov.uk)

Source: Noah Wire Services