The Procurement Act 2023, which came into force to update and streamline public procurement processes, sets out clear rules on when contracts must follow their full scope. A key element of this framework is the financial thresholds that trigger these obligations. The thresholds have changed with effect from 1 January 2026. The changes apply to all procurements which commence on or after 1 January 2026.
The recent revision has resulted in the thresholds being decreased for most contract types. A summary of both the old and new thresholds are set out in the table below. It should be borne in mind when reviewing the below table that the thresholds are inclusive of VAT.
| Contract type | Old Threshold (prior to 1 January 2026) | New Threshold (after 1 January 2026) | Change |
| Works contract | £5,372,609 | £5,193,000 | Reduction by £179,609 |
| Defence & security works | £5,372,609 | £5,193,000 | Reduction by £179,609 |
| Defence & security (other than works, light touch or concession) | £429,809 | £415,440 | Reduction by £14,369 |
| Utilities works | £5,372,609 | £5,193,000 | Reduction by £179,609 |
| Utilities light-touch | £884,720 | £884,720 | Unchanged |
| Utilities (other than works or light-touch), including goods & services | £429,809 | £415,440 | Reduction by £14,369 |
| Light-touch concession | £5,372,609 | £5,372,609 | Unchanged |
| Light-touch (other than concession or utilities) | £663,540 | £663,540 | Unchanged |
| Concession contracts | £5,372,609 | £5,193,000 | Reduction by £179,609 |
| Central government goods / services | £139,688 | £135,018 | Reduction by £4,670 |
| Sub-central government goods / services | £214,904 | £207,720 | Reduction by £7,184 |
If you have any queries in relation to the above, please contact [email protected]
