On 21 November, the government laid the Procurement Act 2023 (Threshold Amounts) (Amendment) Regulations 2025 (SI 2025/1200) before Parliament, which will come into force on 1 January 2026.
The regulations amend the main threshold values in Schedule 1 of the Procurement Act 2023 to keep them in line with the thresholds set out in the World Trade Organisation's Agreement on Government Procurement (GPA), which are updated every two years.
The majority of the thresholds are reducing, meaning that contracting authorities should revisit their planned procurements to check whether the reduced thresholds result in a contract being considered a 'public contract' for the purposes of the Procurement Act 2023.
The threshold changes and difference from the current thresholds are as follows. All thresholds are inclusive of VAT.
|
Type of contract |
Current Threshold |
Threshold from 1 January 2026 |
Amount of decrease |
|
Works contract (not a utilities, defence and security or light-touch contract) |
£5,372,609 |
£5,193,000 |
-£179,609 |
|
Contract for the supply of goods, services or works to a central government authority not within any other row |
£139,688 |
£135,018 |
-£4,670 |
|
Contract for the supply of goods, services or works to a sub-central government authority not within any other row |
£214,904 |
£207,720 |
-£7,184 |
|
Utilities contract that is a works contract |
£5,372,609 |
£5,193,000 |
-£179,609 |
|
Utilities contract that is a light touch contract |
£884,720 |
£884,720 |
£0 |
|
Other utilities contracts |
£429,809 |
£415,440 |
-£14,369 |
|
Defence and security contract that is a works contract |
£5,372,609 |
£5,193,000 |
-£179,609 |
|
Defence and security contract that is a concession contract |
£5,372,609 |
£5,193,000 |
-£179,609 |
|
Other defence and security contracts |
£429,809 |
£415,440 |
-£14,369 |
|
Light touch concession contract |
£5,372,609 |
£5,372,609 |
£0 |
|
Light touch contract that is not concession or utilities |
£663,540 |
£663,540 |
£0 |
|
Concession contracts that is not defence and security, utilities or light touch |
£5,372,609 |
£5,193,000 |
-£179,609 |
