Procurement update: Out with the old and in with the new (thresholds)

The Procurement Act 2023 (Thresholds Amounts) (Amendment) Regulations 2025 will apply from 1 January 2026, introducing new financial thresholds.

These amendments follow a review of relevant thresholds to ensure they continue to correspond with the relevant thresholds laid down in the World Trade Organisation’s ‘Agreement on Government Procurement’.

The amounts of most thresholds have decreased, which means more contracts will now be caught.

The values are again inclusive of VAT, but we have included a column in the table below with a ready reckoner providing an indicative net value on the assumption that VAT applies to the contract in question at a rate of 20%. Some contracts, of course, will not attract VAT.

Public sector

Supplies and Services (Sub-Central Government)

Supplies and Services (Central Government)

Works

Light Touch (Social and other Specific Services)

Light Touch / Concession Contract

Utilities

Supplies and Services 

Works

Utilities and Public Sector

Concessions

For more information, please contact Alison Walton using 0191 211 7850 or [email protected].