How to reduce procurement risk: good practice guide for academy trusts

Question 1

Disclaimer

Accepted Answer

This guidance supports existing government policy and legislation for academy trusts in England by highlighting key procurement considerations when procuring public contracts.

This guidance does not replace or override statutory requirements, and it is not intended to be a complete list of commercial obligations for academy trusts.

We have provided it for general guidance only. You should not rely on it as legal or commercial advice.

Academy trusts remain responsible for:

ensuring compliance with applicable legislation
getting their own legal advice, where appropriate

You should read this guidance with:

the relevant procurement legislation, regulations and government policy
your trust’s financial rules and procedures

This guidance does not cover procurements or contracts awarded under the Concession Contract Regulations 2016, or the Public Contract Regulations 2015. This includes call‑off contracts awarded through frameworks or dynamic purchasing systems established under the 2015 Regulations. These may still be in use during the transitional period and until those arrangements expire.

Question 2

Plan phase

Accepted Answer

Developing your procurement policy

Developing and maintaining a procurement policy for your trust ensures your procurement activity remains transparent, lawful, consistent and controlled.

Scheme of delegation

Your policy could link to the financial scheme of delegation setting out the responsibilities of your stakeholders in relation to tendering activity.

Organising products and services

Your policy may require a strategic approach to organising products and services that your trust buys, into groups. This is often known as category management.

This will give you a clearer picture of the services and supplies you rely on most. It can support:

demand aggregation
improved pricing
opportunities to standardise specifications
better procurement outcomes

Procurement templates

Your policy may require use of standard procurement templates, such as:

planning tools
tender documents and wording
scoring methodologies
evaluation forms
record keeping templates

These:

reduce duplication of effort
support compliance
ensure staff know what information needs to be collected and kept at each stage of the process

Terms and conditions

Your policy may require the use of standardised terms and conditions across your trust to improve legal certainty, consistency and efficiency.

Standard terms and conditions can also help to make sure you meet your requirements in future, by including measures to:

allow terms to extend to new schools if or when they join the trust
support stronger contract management, using defined processes set out and agreed in the contract

Contract register

Your policy may require maintenance of a contracts register to:

provide visibility of upcoming renewals points
understand available termination windows
list your contractual obligations
understand the value of your contracts
appoint a contract owner for the trust and a contact manager for the supplier

This will help:

support forward procurement planning when using a central forward pipeline of procurement activity
track and meet notice obligations for strategic contracts
identify your network of suppliers to understand who your important or strategic suppliers are
reduce contract duplication across schools where delegated authority has been used

Risk register

Your policy could also link to your trust’s risk register, stating how it supports the management, reduction or elimination of the commercial risks identified within the register.

Developing your procurement strategy

Developing a procurement strategy will help you understand how your procurements support the delivery of your trust’s core objectives.

Procurement activity pipeline and contracts register

A procurement strategy can include a central pipeline of procurement activity that:

helps your trust to avoid non‑compliant contract extensions
reduces the need for rushed decisions
helps to identify future needs
ensures enough time and resources are allocated to each procurement
may help to engage markets early

You are legally required to publish a pipeline of activity through a UK1 Pipeline notice if both:

your trust is large, with spend over £100 million in a financial year
you have a planned procurement opportunity with an estimated value of more than £2 million, including VAT and options

Allowing enough time for procurement activity

Your strategy can include guidance or expectations about allowing enough time to conduct procurement activity. This will help to avoid scenarios where you:

do not have enough resource to commit to the activity
are put under pressure to make quick decisions
fall, or risk falling, out of contract with existing suppliers
otherwise fail to meet suppliers’ needs

Your strategy could include a position on social value, to show:

you consider how your procurements can improve the economic, social and environmental wellbeing of the areas where you work
how procurement will help you meet national and your own net zero commitments

Decisions on making or buying

Your strategy could show how you make decisions on whether to make or buy products and services.

You could explain:

how such decisions align with your wider business plan
what risks you might assess when you make decisions
how economic factors may affect your decision making process, now and in future

Supplier and stakeholder mapping

Your strategy can include supplier and stakeholder mapping. This provides a structured way to:

understand your most important suppliers and manage your relationships with them
focus your effort where procurement risk and spend are greatest

This can:

strengthen performance
improve strategic oversight across important contracts

Managing procurement projects

Large procurements can be complex, with several processes, stakeholders and variables to consider.

To help manage your processes for each procurement, you may also find it helpful to treat procurement activities as projects. This separates procurement from day‑to‑day activity, to:

provide enough focus
make successful delivery more likely

The level of detail in each project depends on its size and complexity, and your own internal processes. But a central project record may include:

details of the project team, including roles, responsibilities and assessments of conflicts of interest
assessment of the intended outcomes, how they meet the trust’s strategic goals and any challenges you need to address
evidence, and a summary, of market engagement
an appraisal of options, explaining why you chose the procurement route
records of published tender notices, including Find a Tender notice identifiers
tender documents used, including any in‑process modifications
supplier responses evaluated by the trust
evaluation notes, scores and moderation records
communications with suppliers before, during and after award, including assessment summaries and clarifications
copies of signed contracts
ongoing contract management records, such as meeting minutes, formal notices and KPI data

You can also keep a central project record for each procurement. This will help you meet your legal obligations for over threshold procurements where record keeping is legally required.

Addressing government priorities

The government issues additional guidance on the use of public funds, with primary legislation. Be aware of these documents. They may influence how to interpret and apply internal controls for procurement and spending decisions.

When they carry out procurement activity all public bodies, including academy trusts, must have regard to:

the government’s strategic priorities set out in the National Procurement Policy Statement (NPPS)
the relevant guidance published in procurement policy notes (PPNs)

This is unless there is a clear exemption in the scope section of those documents.

When you interpret scope for these policies, academy trusts are not executive agencies or non‑departmental public bodies. They are usually categorised in the wider public sector. Take this into account when you review the applicability of NPPS requirements or PPN guidance.

Responding to updates

PPNs are published and updated periodically. You can subscribe to email alerts for newly published PPNs, using the ‘get emails about this page’ function on gov.uk. This will help you to know about changes that may affect your procurement policy or approach to procurement.

When a new or updated NPPS or PPN is issued, you could assess if it has any impact on your trust’s internal controls. A short written assessment to trustees can help to show that you have considered the implications, including recognising when a PPN does not apply. This supports effective oversight and helps maintain robust procurement and spending controls.

Your trust may benefit from adopting elements of the guidance even if a PPN falls outside your scope. Cabinet Office PPNs often include useful templates, tools or examples of good practice that trusts can choose to apply voluntarily to strengthen their procurement processes.

When you plan a procurement, think at an early stage about the wider benefits your contract could deliver. This includes economic, environmental and social outcomes.

Consider these impacts at the planning stage. This will help your trust take a consistent, structured approach to meeting your obligations under the Social Value Act.

A useful way to do this is to draw on the social value model. The model sets out:

themes
suggested award criteria
reporting measures

You can build these into your procurement strategy and individual procurements.

If you are buying through a framework, social value requirements may already have been evaluated when the framework was set up. It can still be worthwhile to think about any specific, local benefits your trust might want to achieve.

You may choose to reevaluate social value as part of a further competition, to get outcomes that better reflect your community’s needs.

Keep a clear record of how you considered economic, environmental and social benefits during planning. This will support transparency and show how social value has informed your procurement decisions. Do this for any approach you take.

Question 3

Define phase

Accepted Answer

Conflicts of interest

You must be able to identify and manage both actual and perceived conflicts of interest when you conduct procurement activity using public funds.

This is a requirement in the academy trust handbook and under the Procurement Act. The act places specific duties on contracting authorities during procurement activities.

Keep an up to date register of interests, for everyone involved in procurement activity.

This includes:

preparing an assessment of conflicts of interest before you publish a tender
updating the assessment throughout the procurement process

The procurement pathway includes a template for assessments. You can adapt this to meet your trust’s needs.

When to conduct conflict assessments

You must conduct conflict assessments before publishing a tender notice and should:

conduct them at the very start of the procurement, before you start engaging with the market
review them when you have opened tender submissions and you know who tenderers are
continue to review them throughout the procurement

What to include in assessments

Conflict assessments must cover anyone who may influence decisions related to the procurement. This includes:

trust employees
trustees or governance participants involved in decision making
third parties, such as consultants or advisory partners who may influence procurement decisions

A conflict assessment is legally required for every procurement covered by the Procurement Act. The principles are likely to be relevant and applicable to below threshold procurements too.

An annual declaration of interests is not enough on its own because conflicts:

can arise at any stage
may relate to specific procurement requirements
may involve individuals who are not required to complete your trust’s annual declaration

Data protection implications

Consider the data protection implications of collecting, storing and reviewing this information. This is because conflict assessments normally contain personal data.

This may mean you need to review your trust’s:

privacy notices
records of processing activities
local data protection policies
secure storage locations

You must ensure that personal data processed for conflict assessment purposes is handled lawfully and transparently.

Aggregation to estimate contract value

Your trust must not act in a way that could be seen to avoid the application of the Procurement Act. This includes how you assess the value of your trust’s spending against the relevant thresholds.

When you consider if a procurement meets the relevant threshold, identify when goods, services or works supplied under two or more contracts could reasonably be supplied under a single contract.

When you assess if aggregation applies:

be aware of the Procurement Act’s anti‑avoidance rules
review repeated or recurring spend on similar goods or services across the whole trust
recognise the trust as the contracting authority for the purposes of assessing contract spend on behalf of its schools, even where a scheme of delegation applies

The Government Commercial Function has published guidance on valuing contracts.

When you do not need to aggregate your spend

You should aggregate your spend unless you have a good reason not to.

When you decide if there is a good reason not to aggregate, you may take account of relevant factors such as:

predictability of demand
perishability or shelf life
storage or logistical constraints
the nature of the market
timing or operational constraints
the length of the contract

Buying through public sector buying organisations

Public sector buying organisations are companies or organisations owned and controlled by public bodies that are set up to help you with your procurement needs.

They achieve this by both:

providing frameworks or dynamic markets for you to use
buying day to day goods wholesale with the intent of selling it to you through a catalogue at a competitive price

Buying products or services through a catalogue provided by a public sector buying organisation will not automatically satisfy your trust’s compliance obligations under the Procurement Act.

Every time your trust or a school in your trust orders the same or a similar product from a catalogue, this is a separate contract. Consider it for aggregation where appropriate, and take account of the relevant factors for the category of spend.

Collaborating with others

Beyond compliance, you may also use aggregation to consider the potential for collaboration with other trusts or schools to procure your common items and services. Collaboration may help to:

reduce administration
improve procurement outcomes
achieve better value for money through economies of scale

Also be aware of central aggregation opportunities available from the Government Commercial Agency, to support collaborative procurements. Other networking groups open to trusts may offer similar opportunities to collaborate.

Routes to market

If you are required to procure a contract in accordance with the Procurement Act, the routes to market are set out in the legislation.

You may award contracts:

using the open procedure
using the competitive flexible procedure, including access to dynamic markets
by calling off from a framework
through a direct award, where lawful

Deciding the route

When you decide which route to use, consider:

Record the reasoning for your chosen route to market in the planning documentation. This is to show transparency and good governance.

There is no correct route for choosing between the open procedure and the competitive flexible procedure. Both are valid. You can select either based on your requirements.

You should refer to the Government Commercial Agency detailed guidance on each route to market to support your decision making.

Competitive flexible procedure

You may find it helpful to use the competitive flexible procedure:

for complex procurements
where there is a large number of potential suppliers

The competitive flexible procedure is a new process introduced under the Procurement Act. It offers considerable flexibility in the shape and process you choose to use for your procurement.

This gives you a chance to be innovative on:

how many stages or steps your process could have
what you do in each stage

The procurement pathway has a template and separate guidance to help you build a competitive flexible procedure if this is your chosen route to market.

Direct awards

Do not use direct awards for procurements covered by the Procurement Act unless you have confirmed that a lawful justification applies. Direct awards are only allowed in a limited number of cases set out in Chapter 3 of the Procurement Act. You must be able to show evidence that you have met the criteria.

Where you use a direct award, document:

the justification that applies
why the justification is relevant to the specific procurement
any public interest test that has been carried out
the reasons why awarding the contract to a specific supplier is necessary and proportionate
whether the supplier is an excluded or excludable supplier
the notices or their reference numbers published on the central digital portal
any evidence you have relied on to justify the direct award

Framework assurance

Using a framework can be an efficient way for academy trusts to buy goods and services, and they can streamline procurement. But they do not remove the trust’s responsibilities as the contracting authority.

Always complete proportionate checks before using any framework. These checks help to make sure any call‑off contract you award through a framework:

is lawful
is appropriate
complies with the Procurement Act

If you use a framework, always consider using a DfE approved buying option first if one is available. This:

means proportionate checks have already been completed on your behalf
will help you save time and buy compliantly
should achieve good value for money

If there is no suitable DfE approved buying option available, consider these points before using another framework.

Framework creation and expiry

Confirm with the framework provider when the framework was established and when it will expire. This will help determine:

whether the trust has enough time to complete a call‑off before expiry
which procurement legislation applies

If the procurement establishing the framework contract started before 24 February 2025, then Public Contract Regulations 2015 will apply. If it was after, the Procurement Act will apply.

For open frameworks, also check whether the framework provider intends to extend the term.

Status of the framework provider

Ensure the framework provider is a contracting authority. Under the Procurement Act, only contracting authorities may establish frameworks for procurement.

Publication of notices

Check that the required notices were correctly published when the framework was created. For frameworks established under the Procurement Act, this:

must include a UK 4 tender notice
may also include a UK 1 pipeline notice, UK 2 preliminary market engagement notice or UK 3 planned procurement notice

Trust’s eligibility to use the framework

Confirm that the UK 4 tender notice identifies that academy trusts are entitled to use the framework. Framework providers interpret this requirement differently. You must be satisfied that it is sufficiently referenced for transparency and compliance.

Use without further competition

If you intend to award a contract through a framework without running a further competition, this can be permitted in some cases.

If there is only one supplier on the framework, you should be satisfied that the provider carried out a robust evaluation to select the most advantageous tender.

If there are multiple suppliers, the trust must confirm the framework includes an objective method for selecting a supplier without further competition.

If neither of these conditions apply for the framework you are assessing, do not award a contract without running a further competition first.

Framework value

Check with the provider if the aggregated value of call‑off contracts awarded through the framework is more than the advertised framework value.

Exceeding the value may affect compliance. It could risk the lawfulness of subsequent awards.

Modifications to the framework

Confirm with the provider that the framework has not been modified in ways that the Procurement Act does not permit.

This includes checking if:

any extensions beyond the originally published term are lawful
the contract terms match those published when the framework was awarded

Suitability of terms and conditions

Ensure the framework’s contract terms and conditions are appropriate for the trust’s needs.

Unsuitable terms may:

create avoidable risks during contract management
expose the trust to obligations that are not appropriate

Framework ownership

If you consider establishing a framework for other contracting authorities to use, you should first assess the potential risks and requirements.

Novel, contentious or repercussive transactions

It is possible that a framework for use by other contracting authorities will be a novel, contentious or repercussive transaction if it is established in markets where your trust either:

has no experience
is outside its range of normal business

You must seek DfE approval for any novel, contentious or repercussive transactions before they occur.

Other considerations

You should explore if a DfE approved framework already exists that will satisfy your requirements. If so, use this instead.

If a DfE approved framework already exists but it does not satisfy your requirements, you can use your own. If so, you need to:

identify how your framework will offer the best value for other contracting authorities
share your findings with DfE

As a minimum, you should also:

make sure you have the necessary resources and expertise needed to procure and manage a framework
review your articles of association and charitable objects to determine if the activity is permitted by your object and powers
seek independent legal advice
contact your insurer to check you have the right level of insurance to cover your liability

Working with third parties

If you collaborate with a third party to create a framework, establish the relationship with the third party through competitive procurement and a formal contract. This is to protect the interests of the trust.

The contract may include provisions relating to:

decision‑making rights, and oversight of evaluation, award and management of the framework
control over:
- third party framework access
- duration of call-off contracts
- any fees charged to calling-off authorities and suppliers
- how any income is distributed
rights to terminate the agreement and framework if the route to market is found to breach legislation or statutory guidance

All the other considerations for creating a framework will still apply.

Market engagement

Early engagement with the market can help you shape a more effective procurement.

Market engagement can help you:

understand potential solutions and innovations that could meet your trust’s needs
explore the most suitable routes to market, including procurement tools and whether an open or competitive flexible process is appropriate
encourage competition by increasing supplier interest in upcoming opportunities

Maintaining fairness

When you carry out pre‑market engagement, it’s important to maintain fairness.

Take care not to give any supplier an advantage that could distort competition, including your incumbent. This may mean you have to exclude the supplier from the procurement process.

To reduce this risk, you can:

use a standard set of questions with all suppliers you engage, to avoid the risk of undue influence
publish a summary of your market engagement alongside the tender
separate the people involved in developing the specification from those scoring tenders
take any other steps to protect fairness and independence

Preliminary market engagement notices

If you use any form of market engagement, you must consider whether you need to publish a preliminary market engagement notice. If engagement has taken place, publish this notice before issuing the tender.

If you decide not to publish one, you must explain your reasons in the tender notice.

Developing a specification

When you run a procurement, prepare a clear specification to publish with your tender documents.

A good specification sets out what your trust wants to achieve with the procurement . For contracts that need to be delivered over a longer period of time, it sets out what you are likely to need during the contract’s life.

Do not repeat a previous specification without review. This may be tempting to save time, but it can:

limit opportunities for innovation
overlook advances in the market
fail to reflect how your trust’s needs may have changed

DfE has provided guidance for schools on writing a specification.

Key performance indicators and rules on technical specifications

When you write your specification, you:

should consider which key performance indicators (KPIs) you can use to measure successful delivery of the requirement in the specification
must consider the rules on technical specifications set out in section 56 of the Procurement Act

The section 56 rules:

make sure competition remains open, fair and transparent
prevent specifications being written in a way that unintentionally favours certain suppliers

The procurement pathway includes detailed guidance on technical specifications.

Cabinet Office guidance on the define phase

The Cabinet Office has published guidance on how to meet your obligations during the define phase.

Question 4

Procure phase

Accepted Answer

Contract notices

For any procurement, you will need to publish several notices on the Find a Tender service as you move through the process. These notices are required for transparency. They help suppliers understand:

what you intend to buy
how the procurement will run
who you have awarded contracts to

There is detailed guidance on the different types of notices and when you need each one on Find a Tender.

Academy trusts do not need to publish some types of notices. The section on legal exceptions has more detail.

How to publish notices

To publish notices, your trust must register as a buyer on Find a Tender, using your One Login account. If you already use gov.uk for other services, you may already have an account set up.

Registering gives you direct access to publish notices, or allow your chosen e-procurement system to submit notices on your behalf.

If a third party is helping you set up the account, it’s a good idea to link the One Login details to an administration email in your trust to avoid access issues later.

When registering for the first time, make sure the contracting authority is listed as the academy trust as the legal entity, not each individual school that the trust represents.

Even if you use a third party or system provider to publish notices for you, your trust is responsible for making sure the information submitted is accurate.

Always check the content before publication. Keep a copy of the notice, or the notice reference number, with your procurement documentation.

Tendering

The Procurement Act has given contracting authorities more flexibility in their approach to tenders.

This means the information you need for your tender will vary considerably depending on the procurement procedure and requirements, but will typically include:

an introduction to the trust
details of any premarket engagement and findings
a description of the intended procurement process
a specification document setting out the trust’s requirements including all relevant technical details
the award criteria
the methodology to explain how you will evaluate or score tender responses
the procurement specific questionnaire, to assess the tenderer’s capability and suitability
a set of questions linked to the award criteria, to assess how the tenderer meets the requirements
if applicable, terms and conditions that the supplier will have to accept

Prefilling sections of the contract

If you publish terms and conditions, it can also be helpful to complete any sections of the contract that you can prefill. This can avoid delays later when you come to award and sign the contract.

Future proofing your procurement

You could also future proof your procurement by highlighting any substantial changes in the tender documents that you may need during the contract’s life – for example:

reserving the right to add new schools to the trust
potential mergers
setting out how you will manage pricing reviews and when you will allow them

How to send your tender to bidders

If you can, run your tender:

electronically
in a way that makes it accessible and free of charge for bidders to access

You should usually use an e-tendering system. This is software specifically designed for managing electronic tendering processes.

If you use a framework, the framework provider may allow or require you to use their own e-tendering system to run your competition or award your contract.

Avoiding unfair advantage

When your tender is published, it is important that you do not accidentally provide any unfair advantage to any potential bidder. This could happen if you give additional or clarifying information about the tender outside the process.

This is a particular risk with incumbent suppliers, who you may often communicate with already.

We recommend that you:

provide a clear route for all bidders to ask questions and clarify your requirements
make sure all potential bidders get the same information when you respond to questions

Evaluation

When you evaluate and award a procurement, you need to take account of the legal requirements that apply to competitive tendering. This includes your duties under the sections on:

The procurement pathway includes detailed guidance on assessing competitive tenders.

Your trust can face legal challenges if evaluation is not fair, transparent or consistently applied.

It is also important to consider whether your evaluation panel has conflicts of interest.

It is good practice to:

have at least 2 evaluators for each question or criterion
include a moderation stage led by someone separate from the evaluators

This helps ensure a consistent approach.

Making sure your panel is prepared

You should make sure your panel do some training or reading to make sure they understand their role and responsibilities before you start the evaluation.

Make sure all evaluators at least understand the evaluation methodology and how to apply it.

Do this before you share the tenders with them, to avoid misinterpretation and the need to remark submissions later.

Dividing the panel’s duties

In some cases, each evaluator will evaluate every question for every supplier. But you may need or want to divide the evaluation up among the evaluators.

If so, try to avoid dividing the evaluation by supplier. This can lead to unintended inconsistencies in scoring. Instead provide each evaluator with a question, or set of questions, to evaluate for all bidders.

Each evaluator should complete their evaluation independently of the others, to avoid any unintended influencing between them.

Keeping records

Keep clear records throughout the evaluation. Each evaluator should note the reasons for the scores they award, so these can be referred to during moderation.

Moderation

During moderation, the evaluators discuss their scores and the reasons for them.

They aim to reach a consensus score for each question evaluated.

A moderator normally oversees this. The moderator is a third party who has not been involved in the evaluation.

You are not legally required to have a moderation stage in a tender. But it will help to show that your evaluation decisions were consistent, fair and transparent.

What to do at a moderation meeting

At a moderation meeting, the evaluators should compare scores.

Record discussion around any variances.

Collectively, the group should:

agree a score for each question
record why they agreed the final moderated score

Good record keeping supports a fair and transparent process. It will help you prepare assessment summaries for bidders more efficiently.

Awarding a contract

You can take final steps, and award your contract, after you have completed your evaluation.

For procurements in scope of the Procurement Act, you must issue an assessment summary to each supplier that submitted an assessed tender, before you can complete the award.

The procurement pathway includes assessment summary templates. You can adapt these to suit your trust.

Publishing the award notice

You must publish the award notice on Find a Tender:

after sending the assessment summaries
before entering into a contract

You must not enter into the contract before the end of the mandatory standstill period. At least 8 working days must pass beginning from the day you publish the contract award notice.

This is a requirement under the Procurement Act. It allows unsuccessful bidders time to consider if they believe the Procurement Act has not been followed, which may lead to a challenge.

A challenge is more than a complaint about the outcome of the procurement. It is a legal claim where civil proceedings are brought against the contracting authority.

A challenge could:

delay the award or entry into a contract
potentially lead to the court awarding remedies, including damages or orders affecting the procurement process

Question 5

Manage phase

Accepted Answer

Contract terms

On the award of a contract, make sure the final agreement is set out in a written contract that is properly signed according to your governance procedures. A clear, well‑executed contract:

helps to protect both the trust and the supplier
provides an agreed basis for managing performance

Do not negotiate the contract terms with your chosen supplier after the award of the contract. This will:

undermine the transparency of your tender process
create a risk of challenge from unsuccessful bidders

Using standard contracts

Many trusts choose to develop a standard set of contracts for their schools to use. This can:

create a consistent approach to contracting
help to reduce legal risks across the organisation

Using a template or standard contract will not be appropriate in some cases because it is too complex or risky. Always check that the contract used is appropriate for the service or product being procured.

The trust will be the legal entity responsible for delivering the contract, not the school. This is true whatever format your contracts take. You could agree a standard naming convention for your contracts that makes this clear to your chosen supplier, to avoid confusion later.

Seek appropriate legal advice before creating or adapting templates for regular use.

Automatic terms from the Procurement Act

For above‑threshold procurements, your contract terms automatically include certain implied terms from the Procurement Act. These include the requirement for electronic invoicing and termination rights.

These terms are automatically implied, but you should include suitable references to them in your written contract to avoid disputes later.

There are other implied terms in the Procurement Act 2023, but these do not apply to academy trusts.

Key performance indicators

KPIs are an important part of effective contract management. They help you check whether a supplier is delivering the outcomes you expect.

For public contracts with an estimated value over £5 million, you must include at least 3 KPIs and publish them on Find a Tender, unless you consider that you could not appropriately assess the supplier’s performance using KPIs.

To make KPIs meaningful:

develop them alongside your specification
test ideas through market engagement if you can

This will help you choose measures that are clear, relevant and achievable.

Publish your proposed KPIs in the tender documents. If you are using a competitive flexible procedure and have allowed for such refinement in the tender, you may refine the KPIs later in the process.

There is no maximum number of KPIs you could use. The right number will depend on the contract.

KPIs should directly reflect the outcomes or benefits you expect the contract to deliver.

Each KPI should set out:

the performance objective
how it will be measured
the data source or method
how performance will be evaluated

Reviewing KPI performance

Review KPI performance with the supplier at least once every 12 months. It may be appropriate to review it more often.

For contracts over £5 million, you must also publish an assessment of the KPIs:

at least annually
again when the contract ends

Section 71 of the Procurement Act requires this.

You must use the rating system set out in regulation 39(5) of the Procurement Regulations 2024 to measure KPIs for public contracts over £5 million.

Consider using the rating system in other contracts too. Using these ratings promotes consistency across the public sector.

To make sure you can assess performance properly, include a requirement in your contract for the supplier to provide any KPI data which you cannot reasonably gather.

Keeping KPIs relevant

KPIs should stay relevant throughout the life of the contract.

You may update them or change their targets over time, as permitted by legislation, but this may be limited by the terms of your contract.

To support this, you may want to include a mechanism that allows periodic review and adjustment of KPIs.

The Cabinet Office has published examples of KPIs used for the government’s most important contracts.

Modifying and novating public contracts

You must be satisfied that a modification is allowed under the Procurement Act before you modify a public contract. This applies whether you are:

changing its value
altering its scope
transferring it to another supplier
making any other change

Keep a clear record of your assessment and the reasons for your decision, in case it is challenged later.

If you are asked to novate a public contract to a new supplier, you must check if the incoming supplier is excluded or excludable.

You should consider getting legal advice before carrying out a novation or making any substantial modification.

Before you novate or modify a public contract, you may have to publish a contract change notice on Find a Tender, as section 75 of the Procurement Act requires.

To protect the interests of the trust, we recommend all novations and modifications are:

recorded in writing
signed by all parties
kept with your contract records

Strategic relationship management

Some suppliers will deliver services that are critical to your trust’s long‑term objectives or where failure would create significant disruption.

For these suppliers, it can help to adopt a strategic supplier relationship management approach. This means:

managing the relationship at a senior level
maintaining regular oversight
working collaboratively to monitor performance, resolve issues and support continuous improvement

A structured approach can help you:

build stronger, more resilient partnerships
identify risks earlier and respond more effectively
drive value and innovation throughout the life of the contract
ensure that strategically important services continue to meet the trust’s needs

There are several sources of guidance that can help you design an approach that suits your trust. Useful references include:

These resources can support you in developing a proportionate and consistent framework for managing your most important supplier relationships.

Exit management

You must manage the exit from a contract, to make sure:

services transition between suppliers successfully
you reduce risks and extra costs or pressures at the end of a contract

Consider exit management throughout the contract lifecycle – not just at the end of the relationship.

When you appoint a new supplier or start a new contract, agree an exit plan that will set out the obligations of both parties on termination or expiry of the contract. This is to avoid disputes or unexpected costs.

This plan will vary depending on your needs, but it might include:

what both parties are obliged or expected to do
what or how information or assets may transfer and when
details on how personal information will be securely transferred and handled
how the parties will communicate during the transition process
the impact on continuity of other services which the supplier provides
how you will handle disputes or issues during or after contract termination
details of applicable fees or charges for services not included in the contract delivery
any help, cooperation or transition support the supplier must provide
how you will transfer and access systems, licences, records or intellectual property needed for service continuity

Revisit the exit plan with the supplier over time, to make sure it still adequately reflects the relationship and processes between the parties.

Take care to make sure the exit plan covers how personal data will be managed. Take particular care where employees may transfer at the end of a contract under the Transfer of Undertakings (Protection of Employment) Regulations.

If applicable, a clear plan can help to make sure this information will be:

made available in adequate time to support any retendering activity
used only in accordance with relevant data protection legislation to protect the data subjects

Also consider adding the risks of contract termination or expiry to your risk register.

There are further details on exit management:

Cabinet Office guidance for the manage phase

The Cabinet Office has published guidance on how to meet your obligations during the manage phase.

Question 6

Points to consider throughout the process

Accepted Answer

Value for money

Academy trusts are responsible for spending public money and must ensure that every procurement delivers the best possible value. This means assessing how value for money is achieved throughout the life of a contract, not just at the point of award.

Value for money includes more than just the price you pay. Financial benefits may come from:

cost savings
cost avoidance
improved processes
income generation, in some cases

Consider the costs you expect to incur over the full contract period, and any potential changes in circumstances that may affect the cost to deliver the service.

Value for money can also include wider social benefits. These might include:

jobs created or sustained
training opportunities
spend in the local economy
supply chain diversity

Consider these broader benefits as part of your overall assessment of value.

Identify opportunities to secure value for money during the planning stage of your procurement. Build these opportunities into the specification, evaluation criteria and contract performance measures.

Showing evidence of value for money

When the contract is live, you can show evidence of value for money through:

supplier reports
KPIs
impact measures
other forms of monitoring

More support

The Chartered Institute of Procurement and Supply has more support to identify and measure benefits from your procurement.

Legal exceptions

The Procurement Act sets out the minimum expected commercial standards for public bodies, including academy trusts.

Several parts of the act do not apply to academy trusts. Be aware of these exceptions.

Note these significant exceptions:

academy trusts do not have to submit payment compliance notices to Find a Tender (section 69)
academy trusts do not have to publish information on Find a Tender about payments over £30,000 made under a public contract (section 70)
academy trusts are not subject to any of the requirements for regulated below‑threshold procurements under Part 6 of the act (sections 84 to 88)
30‑day payment terms are not automatically implied into academy trust contracts or their sub‑contracts (sections 68 and 73)

Thirty day payment terms are not mandatory for schools, but they may still apply in practice. This is particularly true when you use a framework or dynamic market where the terms have already been set in the contract itself.

Understanding these exceptions can help you to:

make sure you apply the parts of the legislation that apply to you
recognise where you have flexibility to tailor your own procurement processes

Record keeping

Good record keeping is an essential part of running a fair and transparent procurement.

Keep clear and complete records for your procurement activity:

before each process begins
throughout the competition
after the contract has been awarded

Strong records will:

help to show compliance with the law
enable you to respond quickly and effectively if a procurement is challenged

You must keep:

all communications between the trust and suppliers that relate to the award of a contract
any document that explains a material decision taken during the procurement

This includes decisions made when:

developing the approach
designing the process
assessing suppliers
awarding the contract

Records may include, but are not limited to:

planning documents, including how national government priorities were considered
any market engagement activity and findings
conflict of interest assessments
assessments of supplier exclusions
evaluation notes and moderation records
assessment summaries
the final contract
any correspondence relating to these documents

You must keep records for as long as your own retention policy requires. That must be no less than the minimum period required by the Procurement Act.

Clear and consistent record keeping:

supports good governance
strengthens audit trails
gives confidence that procurement decisions have been made fairly and transparently

Question 7

Acknowledgements

Accepted Answer

We are grateful for the support, advice and materials offered by a range of colleagues to help us produce this guide, including from:

the Association of School and College Leaders
the Chartered Institute of Procurement and Supply
the Confederation of School Trusts
Institute of School Business Leadership
In2 the Bargain Limited
Lift Schools
the National Governance Association
Peterborough Diocese Education Trust
Reach2 Academy Trust
Stone King
Value Match

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