Provider Selection Regime frequently asked questions

The Provider Selection Regime (PSR) is a new set of rules for procuring health care services in England. It is set out in the Health Care Services (Provider Selection Regime) Regulations 2023 (the regulations). The regulations are accompanied by statutory guidance (the guidance) to which relevant authorities must have regard.

The Provider Selection Regime came into effect on Monday 1 January 2024.

NHS colleagues involved in the arranging of health care services have asked for further support to help them understand the new requirements of the PSR. These frequently asked questions are intended as an introductory guide to assist organisations when applying the PSR and have been written for that purpose only. They describe a number of scenarios, alongside NHS England’s view of the legal framework and the likely steps required to discharge legal duties.

Each provider selection process will be different. Therefore, this document does not set out an exhaustive list of requirements or offer guidance on how individual processes should be run. It does not replace the need for local consideration when applying the PSR. Those following the PSR should refer to the PSR regulations and the PSR statutory guidance and seek appropriate specialist legal input where necessary.

For the purposes of these frequently asked questions, ‘health care services’ means ‘relevant health care services’ in scope of the regulations, and the ‘arranging of health care services’ refers to when a relevant authority procures relevant health care services under the PSR.

The PSR applies only to ‘relevant authorities’ when arranging health care services – these are:

  • NHS England
  • integrated care boards (ICBs)
  • NHS trusts and NHS foundation trusts
  • local or combined authorities

Scope of the Provider Selection Regime

The PSR applies only to the organisations listed as relevant authorities. These relevant authorities are based in England. If a relevant authority wishes to arrange health care services with a provider that is based outside of England, then they must apply the PSR.

If an organisation based outside England wishes to arrange health care services from a relevant authority (for example an NHS trust) based in England, then the PSR does not apply.

NHS trusts and foundation trusts are relevant authorities, so must use the PSR when arranging health care services. This includes when subcontracting health care services.

Yes. Relevant authorities must apply the PSR when arranging health care services in scope of the PSR, whether they are selecting an NHS provider (NHS trust or foundation trust) to deliver the health care services or otherwise.

Yes. Relevant authorities must use the PSR when arranging health care services in scope of the PSR.

This means relevant authorities must use the PSR when procuring health care services from other relevant authorities or from organisations not classed as relevant authorities, such as those from the independent, voluntary, community, or social enterprise sectors.

No, non-NHS providers, for example independent, voluntary, community, or social enterprise sector providers are not considered relevant authorities under the PSR, so do not need to apply the PSR.

Preventative public health services are in scope of the PSR. All forms of health care services designed to secure improvement in the physical and mental health of the people in England, and in the prevention, diagnosis and treatment of physical and mental illness are in scope of the PSR.

However, the service must be provided to an individual. This means that public health interventions provided directly to an individual such as helping people to quit smoking or drinking are in scope, but mass communication campaigns to raise awareness of a particular health issue are out of scope of the PSR.

For a process starting on or after 1 January 2024, relevant authorities must use the PSR when arranging health care services in scope of the PSR.

For the procurement of goods or services not in scope of the PSR, the PCR may apply.

If the subject matter of the procurement is a mixture of health care services and non-health care services or other goods, then the relevant authority must apply the test for mixed procurements to determine whether the procurement should go under the PSR or the PCR – see Regulation 3 and the guidance for further information.

The PSR applies only when relevant authorities arrange health care services in England. When in force, the Procurement Act will replace the PCR. The Procurement Act will not apply to the arranging of health care services by these relevant authorities.

For example, the Procurement Act will apply to the procurement of goods (i.e., medicines or medical equipment) and services delivered by relevant authorities that are out of scope for the PSR (i.e., cleaning, catering, consultancy, estates etc.) – unless these services are part of a mixed procurement that is covered by the PSR. The Procurement Act will also apply to the procurement of health care services when procured by public bodies and organisations that are not relevant authorities under the PSR.

Yes. The Provider Selection Regime (PSR) provides flexibility so that each relevant authority can take local decisions to arrange health care services in a way that best suit the needs of their patients and service users at that specific time.

For the avoidance of doubt, if a relevant authority has used a specific provider selection process to award a contract for a health care service previously, it is not bound to use that same provider selection process for that service when selecting a provider next time (unless a specific provider selection process must be used based on the circumstances).

Further, different relevant authorities may use different provider selection processes to arrange similar health care services (unless a specific provider selection process must be used based on the circumstances). In all scenarios, the health care services must be arranged in accordance with the requirements set out in the PSR.

SEND health care services are in scope of the PSR. But education and social care services are not in scope of the PSR, so if these are arranged alone the PSR must not be used.

If the services being arranged involve health care services and other goods or services, it may be considered a ‘mixed procurement’ if it meets the requirements for mixed procurement.

Patient transport services delivering a regulated activity (for example, those that require Care Quality Commission (CQC) registration) are in scope of the PSR. Patient transport services delivering an activity that does not require CQC registration are out of scope of the PSR. Where both regulated and unregulated activity is commissioned, the relevant authority must consider whether the mixed procurement provisions apply.

Yes, however, there may be times where CPV codes are not available for a specific health care service. In these cases, when publishing a transparency notice, the CPV code which is most relevant to the health care service being arranged must be used. It may be that the overarching ‘health service’ CPV code is the only suitable one.

Relevant authorities must note that if a specific CPV code is available and has not been listed in the regulations, then it is not in scope of the PSR. For example, there is a CPV code specifically for chiropractor services, but this is not included in the list of CPV codes under Schedule 1 of the regulations. Therefore, the procurement of chiropractor services does not come under the PSR, and relevant authorities must follow the Public Contracts Regulations 2015 (PCR) for the procurement of these services.

Please see a list of all available CPV codes.

Relevant authorities under the PSR will need to ensure they are prescribed under the NHS Bodies and Local Authorities Partnership Arrangements Regulations 2000 before making arrangements under those powers.

An agreement made under section 75 of the National Health Services Act 2006 for partnership arrangements between NHS bodies and local authorities can include arrangements for pooling resources and making arrangements for the exercise of certain NHS and local authority health-related functions (including certain commissioning functions) by the other partner(s). These arrangements are often used to integrate health and social care services. Where services are commissioned under these partnership arrangements, they must be arranged under the PSR if the services arranged are health care services, or if they meet the PSR requirements for mixed procurements.

For financial years 2023/24 and 2024/25, the Cabinet Office Spend Controls apply only to NHS trusts and NHS foundation trusts when arranging health care services with providers outside of the NHS – please see the Cabinet Office Spend Controls for more detail.

The organisation that is controlling the procurement and developing the business case is responsible for working with NHS England to ensure Cabinet Office approval is obtained – i.e., the responsibility would sit with a shared procurement service where it is manging the procurement of £10 million or more, for multiple organisations.

Making decisions about provider selection processes

Relevant authorities must carefully consider all relevant circumstances when making decisions. If the criteria are met to follow direct award process A or B, then these processes must be followed to award the contract. A competitive process must be used for awarding a framework agreement.

In all other circumstances, each relevant authority must decide which provider selection process is appropriate for a particular situation, and to ensure best outcomes are achieved for their patients.

A flow chart has been produced to help relevant authorities identify which is the most appropriate route to take to achieve the best outcomes for patients and service users.

No, direct award process B is not replacing the requirement to establish and apply qualification criteria for assessing providers as a choice for patients.

Direct award process B in the Provider Selection Regime (PSR) sets out how to award a contract for health care services where patients are offered a choice of provider and where the number of providers is not restricted by the relevant authority, after the provider has met all requirements in relation to the provision of the health care service to patients.

The NHS Standing Rules will set out the qualification criteria against which providers should be assessed to become a ‘qualified’ provider for services where patients’ legal rights to choose a provider and team apply, and other services where the relevant body has decided not to restrict the number of providers patients can choose from.

Example A (threshold not met):

The relevant authority initially awarded a contract worth £3,000,000 to their chosen provider.

The contract was for three years (without any associated extensions). At the end of the three

Years, the relevant authority wishes to award a new contract to the same provider for the same services. The new contract is estimated to be worth £3,650,000 because there have been some minor changes made to it (but none that would render the contract materially different in character). 

In this scenario, the change in value of the proposed new contract is £650,000 and thus over the £500,000 threshold. However, this change in value of the proposed new contract represents only 21.6% of the lifetime value of the original contract when that contract was entered into, thus is below the 25% threshold.

In this scenario, the considerable change threshold is not met, and the relevant authority would be able to progress with direct award process C.

Example B (threshold met):

The relevant authority initially awarded a contract worth £1,500,000 to their chosen provider. The contract was for the duration of five years. At the end of the five years the relevant authority wishes to award a new contract to the same provider for the same services. The new contract is estimated to be worth £2,050,000 because there have been some minor changes made to it (but none that would render the contract materially different in character).

 In this scenario, the change in value of the proposed new contract is £550,000 and thus over the £500,000 threshold. This change in value of the proposed new contract represents 36.7% of the lifetime value of the original contract when that contract was entered into, thus is above the 25% threshold. The increase in value was not introduced in response to external factors beyond the control of the relevant authority.

In this scenario, the considerable change threshold is met, and the relevant authority would not be able to progress with direct award process C. The relevant authority would need to use either the most suitable provider process or the competitive process to award the new contract.

Example C (threshold not met):

The relevant authority initially awarded a contract worth £1,500,000 to their chosen provider. The contract was for the duration of five years. At the end of the five years the relevant authority wishes to award a new contract to the same provider for the same services. The new contract is estimated to be worth £2,500,000. The change in value of the proposed new contract is £1,000,000 and thus over the £500,000 threshold.

This change in value of the proposed new contract represents 40% of the lifetime value of the original contract when that contract was entered into, thus is above the 25% threshold. However, this change in value is due to an increase in patient volumes, beyond the control of the relevant authority and the provider.

In this scenario, the considerable change threshold is not be met, because whilst there are changes to the proposed contracting arrangements, the relevant authority had to make these in response to external factors. Therefore, the relevant authority would be able to progress with direct award process C.

Relevant authorities must consider the key criteria and the basic selection criteria, and should consider any key performance indicators that they have set out in the original contract, to determine whether the existing provider has satisfied the existing contract to a sufficient standard.

Relevant authorities may wish to consider whether regular performance reviews or contract management meetings, and the evidencing of these, could help with their assessment (and decision).

Relevant authorities may consider organising market engagement events, roundtables, or meet the buyer days as part of their pre-market engagement exercises. The types of activities might depend on the size and complexity of the services/contracts in question.

Relevant authorities are expected to understand the provider landscape, and when following the most suitable provider process are advised to consider undertaking a pre-market engagement exercise to help them identify suitable providers.

Relevant authorities must also publish a notice setting out their intention to follow the most suitable provider process. Following the publication of this notice, the relevant authority must wait fourteen calendar days before beginning their assessment of providers. If providers contact the relevant authority in this period, asking to be considered for the contract award, then the relevant authority must consider whether these providers might be potential providers.

Relevant authorities may design and run the competitive process any way they choose, so long as the process complies with the procurement principles of the Provider Selection Regime (PSR) and with the steps outlined in the competitive process. This means that relevant authorities may run the competitive process in stages (e.g., assessing the different award criteria at different points in the process).

We expect timescales applied to be reasonable.

Relevant authorities wishing to switch processes for provider selection (for example from the most suitable provider process to the competitive process because they realise that they cannot identify the most suitable provider without running a competitive process) must formally abandon the current selection process before starting a new one.

After deciding to abandon a provider selection process, relevant authorities must publish a notice of that decision on the Find a Tender Service (FTS) website as a corrigendum notice to the most recently published notice. Relevant authorities are also expected to notify, in advance of the notification being published, providers that were aware they were being considered for the award of a contract (e.g., in response to a tender under the competitive process).

Relevant authorities must keep a record of their reasoning for abandoning a provider selection process.

Relevant authorities may have their decisions challenged under the Provider Selection Regime (PSR). This includes the record keeping, publication and transparency requirements set out in the regulations and guidance. They must be able to produce these records if challenged either during the standstill period (including through the PSR review panel) or outside of the regime (for example, through a judicial review).

There may be occasions under the regime where decisions could be subject to a judicial review.

Where appropriate to keep all services under a single contract, relevant authorities are advised to consider which single provider selection process is the most appropriate for the entire contract. For example, that the contract should be awarded using one of the direct award processes or the most suitable provider process or the competitive process in accordance with the procurement principles, and where appropriate the key criteria and the basic selection criteria.

Relevant authorities must keep internal records of their decisions and their decision-making processes and must publish notices confirming their decision to award a contract.

Key criteria

The relative importance of the key criteria is not pre-determined and there is no prescribed hierarchy or weighting for each criterion.

Where direct award process C, the most suitable provider process, or the competitive process is followed, relevant authorities must decide on the relative importance of the key criteria under the Provider Selection Regime (PSR) based on what they are seeking to achieve from the service.

Relevant authorities can decide the key criteria are of equal importance if they wish, but they are advised to carefully consider the relative importance of the value criterion when following the most suitable provider process or the competitive process.

Where applicable, relevant authorities must also comply with their other duties, for example NHS England, ICBs, NHS trusts and NHS foundations trusts are expected to assign a minimum of 10% to social value.

All criteria must be considered, and none is expected to be discounted when following a provider selection process. Some examples are provided below:

Example 1: Equal weighting
Quality and innovation 20%
Value 20%
Integration, collaboration, and service sustainability 20%
Improving access, reducing health inequalities and facilitating choice 20%
Social value 20%

 

Example 2: Unequal weighting
Quality and innovation 25%
Value 25%
Integration, collaboration, and service sustainability 20%
Improving access, reducing health inequalities and facilitating choice 15%
Social value 15%

 

Example 3: Pass/fail
Quality and innovation Must meet minimum standard
Value Must meet minimum standard
Integration, collaboration, and service sustainability 40%
Improving access, reducing health inequalities and facilitating choice 30%
Social value 30%

Yes. Relevant authorities can consider whether setting some of the key criteria as pass/fail is the most appropriate way of evaluating providers.

No. The key criteria can be balanced differently depending on the services, objectives, and priorities under consideration.

Relevant authorities may consider other factors, relevant to their local area, as part of their decision-making when selecting a provider. However, relevant authorities are expected to integrate all considerations under the five key criteria.

No. Once a decision has been taken about the weighting of the key criteria, relevant authorities must record these and where required publish these. All assessments of providers must be made against the stated weighting of the key criteria. If relevant authorities wish to change the weighting of the key criteria, they must abandon the provider selection process (in accordance with the regulations and the guidance) and must start a new provider selection process.

However, where relevant authorities are following the competitive process and decide to run the process in multiple stages, they may decide to weigh the key criteria differently in the different stages of the process (i.e., change the relative importance throughout the process), provided that the relevant authority makes this clear upfront and continues with what it has published at the outset of the process. For example, relevant authorities may decide that in the first round of selection they wish for some of the key criteria to be pass/fail (such as value) then in the next round for all key criteria to be weighted equally.

The relevant authority must assess providers fairly and transparently against the key criteria. Any assessments must be recorded, and the information kept, in accordance with the regulations. The transparency requirements mean that the considerations or assessments made against the key criteria must be published.

The Provider Selection Regime (PSR) sets out the basic selection criteria that providers should meet. This includes financial stability. The PSR also includes a list of exclusion criteria, which align with those in the Public Contracts Regulations 2015 (PCR), and means that providers can be excluded from selection processes based on their financial standing, such as bankruptcy or because they are undergoing insolvency proceedings.

The Provider Selection Regime (PSR) requires relevant authorities to consider five key criteria when making decisions; one of these is value. This does not just refer to the cheapest service, instead relevant authorities are advised to consider the wider meaning of value for money – for example, how the service might add value across an integrated health care system, how the service quality might improve outcomes beyond the immediate service and thus reduce overall spending.

We advise that for provider selection processes with higher contract values, greater focus is given to value for money and the quality and efficiency of the services to be provided, unless this means the service does not best meet the needs of the population it is serving.

NHS England published its Net Zero Roadmap, which includes a commitment to reach net zero by 2045 for emissions from goods and services procured by the NHS. NHS organisations should place a minimum 10% weighting on net zero and social value in NHS procurement. Furthermore, since 1 April 2023 there is a requirement for suppliers to provide a carbon reduction plan, which applies to the purchasing of good and services – including health care services – by NHS organisations and organisations acting on their behalf.

Therefore, when NHS organisations are using the PSR (and following direct award process C, the most suitable provider process, or the competitive process) to arrange health care services they must ensure that the social value key criterion is weighted to be a minimum of 10%. When local authorities are arranging health care services jointly with NHS organisations or on behalf of NHS organisations then they must also comply with this requirement.

Contract modifications (variations)

Contract modifications are changes made to a contract during the term of that contract.

Provider selection, using one of the provider selection processes, is intended to be applied when a:

  • contract is coming to an end and a new contract needs to be awarded
  • new service needs to be established (and so a new contract needs to be awarded for the delivery of those services)
  • modification to a contract is desirable mid-term but would lead to a modification that’s not permitted, resulting in a new contract needing to be awarded via one of the provider selection processes (the relevant authority would have to carefully check contract terms).

From the 1 January 2024, the PSR must be used for the modifications of contracts that relate to health care services. This is irrespective of whether the original contract was awarded under the PCR or the PSR. See more in transitional arrangements.

Yes. Under the PSR a modification is permitted if the modification, conditions for triggering the modification and the impacts of the modification, are clearly and unambiguously provided for in the contract or framework agreement documents.

If the modification that’s provided for in the contract or framework agreement is over £500,000, and it is attributable to a decision of the relevant authority, then a transparency notice must be published to highlight the contract modification.

Requirements for transparency

All transparency notices under the PSR are published on the Cabinet Office’s FTS portal. Information about where each notice must go is provided in the additional FTS guide.

No. The FTS guide provides information about which notices should be used and the wording to be used when applying the Provider Selection Regime (PSR).

No, transparency requirements are not the same for all provider selection processes. Annex B of the guidance details the requirements for each provider selection process.

Relevant authorities must keep internal records of their decisions and their decision-making processes and must publish notices confirming their decision to award a contract. Information about the record keeping requirements is set out in the guidance.

When following the most suitable provide process, relevant authorities must allow 14 calendar days between the publication of the intention to follow the most suitable provider process notice and beginning to assess the potential providers.

For other processes, there is not a specified period that must elapse between the publication of notices on FTS. Relevant authorities should decide what is a reasonable and proportionate period in a particular market.

Relevant authorities must ensure that the governance arrangements they have in place for making provider selection decisions can manage conflicts that arise, ensuring that decisions are made transparently and in the interest of patients and taxpayers. Relevant authorities may wish to give a role to board committees or non-executive directors (or other senior persons independent of the decision-making process) in minimising, managing, and resolving conflicts of interest relating to provider selection decisions.

Governance arrangements put in place to manage conflicts of interest should also consider the vision of collaboration and joint working set out in the NHS Long Term Plan and the intent of the Health and Care Act 2022 in bringing system stakeholders together to jointly make decisions about care provision. However, these arrangements must align to the requirements of the PSR.

For example, ICBs must ensure that they comply with their statutory obligations on the management of conflicts of interest, as set out in section 14Z30 of the NHS Act 2006.

Yes. When the confirmation of the decision to select a provider is published, any conflicts of interest and how these were managed must be published.

No. This is not required. However, robust internal records should be kept justifying decisions (see the guidance), including detail on the information required for transparency notices published on FTS.

Relevant authorities must publish a summary of their application of the Provider Selection Regime (PSR) annually online (e.g., via the relevant authority’s annual reports or annual governance statement). We expect the first annual summary to relate to contracts awarded using the PSR between 1 January 2024 – 31 March 2025, and we expect this to be published no later than six months following the end of 2024/2025 financial year.

Following the first annual summary, all other annual summaries must be published no later than six months following the end of the financial year they relate to.

Reviewing decisions during the standstill period

No. The standstill period only applies to provider selection decisions made under direct award process C, the most suitable provider process, and the competitive process. This includes concluding a framework agreement or awarding a contract based on a framework agreement following a mini competition.

Relevant authorities are required to be transparent about their decision making under the PSR. This is to ensure that the system is fully informed about the decisions that are being taken.

Providers may make representations during the standstill period if they believe that the PSR has not been correctly applied. If the provider remains unsatisfied with the response of the relevant authority to its representation and remains of the view that the PSR has not been applied correctly, the provider may submit a representation to the PSR Review Panel (see the guidance for further information).

Any decision made by a relevant authority under the PSR may potentially be challenged via an application for judicial review.

Providers may make representations to the relevant authority during the standstill period when following direct award process C, the most suitable provider process, or the competitive process (including when concluding a framework agreement).

There is not a mechanism under the PSR to challenge contract award decisions made under direct award process A or B. When awarding a contract based on a framework agreement, only providers party to the framework agreement can make representations.

Further, there may be occasions under the PSR where decisions could be subject to a judicial review – this includes the decision to award a contract under direct award process A or B.

A decision can be challenged during the standstill period on the grounds that the regulations were not applied correctly. For example, because the relevant authority was not following the transparency requirements, used an incorrect provider selection process, or failed to manage conflicts of interest appropriately.

In the competitive process, a decision could be challenged on the grounds that the assessment process was not carried out as described in the procurement documents.

Further, there may be occasions where decisions taken under the Provider Selection Regime (PSR) could be subject to a judicial review, which may include challenge on other grounds (i.e., that the relevant authority did not act reasonably).

Yes. For example, where an ICB arranges for the exercise of its commissioning functions by a local authority or places this function into a joint committee using section 75 powers, the ICB would remain liable for the decisions of the local authority exercising those functions – this is set out in s.75(5) of the 2006 Act.

Relevant authorities therefore are advised to set out, in advance of entering into section 75 arrangements, how decisions made by the body exercising the functions would be overseen.

This may for example include situations where a provider brings a representation against the local authority that is exercising the commissioning functions of an ICB, and where this representation goes to the PSR review panel for advice. The ICB arranging for the exercise of its functions by the local authority would be advised to consider how they might ensure the local authority considers the advice of the PSR review panel.

Framework agreements

Framework agreements must be concluded using the competitive process (see the guidance for further information).

Relevant authorities may award contracts under a framework agreement using the following approaches:

  • competitive process; or
  • without competition, so long as this is provided for in the terms and conditions of the framework agreement.

Yes, but only in circumstances where the terms and conditions of the framework agreement allow for this.

The length of a framework agreement must not exceed four years, other than in exceptional circumstances where the relevant authority is satisfied that the subject-matter of the framework agreement justifies the longer term.

Therefore, once the framework agreement has reached the end of its term, relevant authorities must establish a new framework agreement using the competitive process, if they wish to keep using a framework agreement. Relevant authorities may decide to set out the same requirements, the same terms and conditions, and apply the key criteria in the same way. However, different providers may apply to be party to the new framework agreement.

Transitional arrangements

Up-to-date information can be found on the NHS Provider Selection Regime website. NHS England will be hosting a series of webinars, aimed at relevant authorities who must comply with the PSR.

The confirmed dates for the webinars are published and interested individuals can now register for these. Policy webinars will give a high-level overview of the new regime (suitable for senior leaders and commissioners) whilst the practitioner webinars will provide more detail on how to comply with the PSR (suitable for those who will have to apply the PSR day-to-day).

Relevant authorities can read and familiarise themselves with the regulations and the guidance. The guidance provides detailed information about how to comply with the new regime.

Relevant authorities can also access the PSR toolkit implementation products, which provide further support about the application of the PSR.

In addition, relevant authorities are advised to consider whether:

  • current contract expiry dates are fully understood, so that planning for contract renewals can be carried out well in advance;
  • conflicts of interests are effectively identified and managed in advance of the PSR coming into force;
  • plans for record keeping requirements are in place;
  • the new requirements for the publication of transparency notices on the FTS website are understood – the FTS guide can help with this;
  • the key criteria are understood, including the types of evidence that may be used; and
  • their market knowledge of the provider landscape is up to date and how they will continue to maintain this.

Contracts must be in place for the delivery of services to patients and service users. If existing contracts are approaching expiry and/or new services need to be commissioned, relevant authorities should begin their processes leading to the award of new contracts in good time to ensure service continuity/availability.

Those processes are governed by the law applicable at the point that the process began, i.e., the Public Contracts Regulations 2015 (PCR) and the Procurement, Patient Choice and Competition Regulations 2013 (PPCCR).

Relevant authorities should not delay starting procurement processes to wait for the PSR to come into force, if doing so might risk jeopardising service continuity/availability.

Each procurement process must be run, and award decisions must be made, under the law as applicable at the point at which that process began. Until the PSR comes into force – 1 January 2024 – the current rules (the Public Contracts Regulations 2015 (PCR) and the Procurement, Patient Choice and Competition Regulations 2013 (PPCCR)) continue to apply.

Therefore, if a procurement exercise is commenced under the current rules (the PCR and the PPCCR), then it must be completed under those rules. This applies even if the process is ongoing and completed after the PSR has taken effect.

Relevant authorities that have commenced a procurement process under the PCR but wish to re-start that procurement process using the PSR should first formally abandon the procurement process in accordance with the current rules (the PCR and the PPCCR). The relevant authority must then re-start the procurement process from the beginning under the PSR rules. We recommend that any relevant authorities considering this should take legal advice before doing so – so that they may consider the risks of such an action, and whether they can lawfully abandon their original process under the PCR.

Contracts called off from a framework agreement established before the PSR comes into force must be called off using the process described in the framework agreement (which would have been based on the PCR and/or PPCCR).

Contracts awarded under the PCR/PPCCR and modified before the PSR has come into force, must be modified in accordance with the PCR/PPCCR.

Contracts awarded under the PPCCR/PCR and modified on or following 1 January 2024 must be modified in accordance with the PSR.

Once the PSR comes into force, health care services procured by relevant authorities (under the PSR) will be removed from the scope of the PCR. Relevant authorities must continue to procure goods and non-health care services in compliance with the PCR unless these are part of a mixed procurement (or unless other laws apply).

In addition, the PPCCR will be revoked as set out in section 80 of the Health and Care Act 2022 and the choice provisions contained within will be replaced by the updated NHS Standing Rules.

DPSs continue to exist under the Public Contracts Regulations 2015 (PCR) rules, and relevant authorities can utilise those DPSs until they expire. However, the PSR does not provide a means to establish new DPSs.

Contracting

The NHS Standard Contract must continue to be used by NHS England and ICBs when awarding contracts for relevant health care services other than primary care services.

No. The Provider Selection Regime (PSR) does not set limitations on contract lengths, nor (where it is the form of contract being used) does the NHS Standard Contract.

However, relevant authorities are advised to consider carefully the risks and benefits of offering a longer contract, in the context of their own standing rules and, for example where applicable, NHS England’s Contract Technical Guidance and Standing Financial Instructions.

The Provider Selection Regime (PSR) does not specify how many times a contract can be extended using contract modifications. However, relevant authorities must ensure that they comply with the provisions for contract modifications in the PSR, as well as the terms of the specific contract.

The Provider Selection Regime (PSR) does not place any value limits on the contracts that can be awarded under the direct award processes or the most suitable provider process. Relevant authorities are advised to consider the most appropriate process to follow based on their unique circumstances.

Some minor clarificatory changes reflecting the Provider Selection Regime (PSR) will be proposed for the 2024/25 version of the NHS Standard Contract, and – subject to the outcome of consultation on those proposals – will become effective from 1 April 2024. We do not consider it necessary to make any changes to the NHS Standard Contract before then.

Once the PSR comes into force, relevant authorities must make any contract modifications, including contract extensions, under the PSR.