What are thresholds?

Contract thresholds refer to a set of predefined monetary limits and fixed criteria that dictate how and whether public sector contracting authorities must publish various procurement notices.

Contract thresholds have existed in the UK for decades but have been brought into sharp new focus with the introduction of the 2023 Procurement Act, which aims to increase transparency in public procurement.

Below-threshold contracts are subject to fewer obligations than above-threshold contracts.

For below-threshold procurements, tender notices and contract details notices are typically the only compulsory publications – and even these may not apply for very low value procurements below a specific limit.

The majority of the provisions in the Procurement Act 2023 (Act) only apply to a public contract. A contract is only a public contract where it is not exempted and has an estimated value (including VAT) of not less than the threshold amounts set out in Schedule 1. These thresholds are therefore critical in ensuring that contracting authorities understand when they need to comply with the standard provisions in the Act.