PPN 017: Improving transparency of AI use in procurement · first published 17 February 2025
PPN 017 is an Information Note from the Cabinet Office that gives central government buyers optional questions to ask suppliers about their use of Artificial Intelligence (AI) — both in writing bids and in delivering the contracted service. It was originally issued in November 2023 and updated in February 2025 to align with the new Procurement Act 2023 terminology. Using AI to write a tender is explicitly not prohibited; the policy simply requires transparency about it. If a buyer believes AI was used in a bid, they may ask clarification questions, request supporting evidence, or carry out site visits to satisfy themselves the supplier can genuinely deliver. Small businesses using AI tools to help write bids should be ready to say so honestly and confirm their responses have been checked for accuracy.
WHO THIS APPLIES TO
THE ENKII VIEW
For SMEs, the explicit statement that AI use in bid-writing is permitted — treated similarly to using a professional bid writer — removes any worry about being penalised for using these tools. The real opportunity is to use AI to bid for more contracts while being prepared to stand behind every word: buyers are likely to ask disclosure questions and may probe capability more deeply if AI use is declared. SMEs whose actual service delivery involves AI (e.g. software products, transcription tools) should also be ready to describe that use, as buyers will increasingly ask about it under Disclosure Question 3.
1. If you use AI tools (e.g. ChatGPT, Copilot) to help write any part of your tender, be ready to answer a disclosure question honestly — say yes, describe the tools used, and confirm you have checked everything for accuracy.
All SMEs bidding on central government contracts from 24 February 2025 — The PPN explicitly permits AI use in bid-writing but expects transparency; buyers can add Annex B disclosure questions to any Invitation to Tender and may probe further if the answer is unclear.
2. Before submitting, review every AI-generated section of your bid carefully for factual errors, hallucinations or unsupported claims — then document that you did this review.
All SMEs using AI in bid-writing — The PPN warns that LLMs produce 'statistically plausible' text that may contain inaccurate or misleading statements; buyers are told to carry out extra due diligence on AI-assisted bids, and your documented review will help you pass that scrutiny.
3. Prepare a clear, plain-English description of how AI is integrated into what you deliver — what data it uses, how outputs are checked, and how customer data is protected — so you can answer Disclosure Question 3 confidently.
SMEs whose products or services use AI or machine learning in their delivery — Buyers are specifically advised to ask suppliers whether AI is part of service delivery and to consider contractual amendments if it is; a ready answer builds trust and avoids delays.
4. Never feed confidential government tender documents, unpublished specifications or other non-public buyer information into an AI or LLM tool — not even to help draft a response.
All SMEs bidding on central government contracts — The PPN explicitly requires buyers to put controls in place to prevent this; doing so could be treated as a serious breach of procurement rules and could disqualify your bid.
5. If your bid or service involves sensitive or classified areas, check with the contracting authority early whether additional AI-related risk mitigations apply before you commit to a bid approach.
SMEs bidding on contracts with national security elements — The PPN states that national-security procurements 'may require additional considerations and risk mitigations' around AI use, which could affect what tools you can deploy.
6. Review your standard terms and conditions to ensure they do not allow you to use government meeting data, documents or user data to train AI models without explicit written client approval.
SMEs offering software, data or technology services to central government — The PPN's video-conferencing example signals buyers will look for contractual clauses preventing data being used for AI training 'unless specifically agreed and approved in writing by the client.'
Every rule below quotes the official document verbatim.
This PPN applies to all central government departments, their executive agencies and non-departmental public bodies (NDPBs); other public sector contracting authorities are encouraged but not required to follow it. (All central government departments, executive agencies and NDPBs)
“This Procurement Policy Note (PPN) applies to all central government departments, their executive agencies and non-departmental public bodies. Such bodies are referred to as 'in-scope organisation'.”
In-scope organisations must note the provisions of this PPN from 24 February 2025. (All in-scope organisations)
“In-scope organisation should note the provisions of this PPN from 24 February 2025.”
The updated PPN (aligned to Procurement Act 2023 terminology) applies to procurements commenced on or after 24 February 2025; procurements commenced before that date fall under PPN 02/24. (All in-scope organisations; procurements from 24 February 2025)
“The Procurement Act 2023 and the Procurement Regulations 2024 apply to procurements commenced on or after 24 February 2025.”
Suppliers' use of AI in bid-writing is not prohibited during the commercial process. (All suppliers bidding on in-scope procurements)
“suppliers' use of AI is not prohibited during the commercial process but steps should be taken to understand the risks associated with the use of AI tools in this context”
Disclosure questions about AI use must not be scored or used to assess a tender; they are for information only. (All in-scope procurements using Annex B disclosure questions)
“The questions included in this annex should not be scored or taken into account when assessing a tender and should be used for information only.”
Buyers may ask suppliers to disclose AI use in bid creation and to confirm that AI-generated responses have been checked and verified for accuracy. (All in-scope procurements)
“Asking suppliers to disclose their use of AI in the creation of their tender (See Annex B for an example of text that can be added to procurement documentation).”
If AI tools were used to create tender responses, buyers may require additional due diligence — including site visits, clarification questions or supplier presentations — to verify the supplier's capacity and capability. (All in-scope procurements where AI use in bidding is disclosed or suspected)
“If suppliers use AI tools to create tender responses, additional due diligence may be required to ensure suppliers have the appropriate capacity and capability to fulfil the requirements of the contract.”
Suppliers must not use confidential government tender documents or non-public information as training data for AI or Large Language Models (LLMs). (All suppliers bidding on in-scope procurements)
“Putting in place proportionate controls to ensure suppliers do not use confidential contracting authority information, or information not already in the public domain as training data for AI systems e.g. using confidential Government tender documents to train AI or Large Language Models (LLMs) to create future tender responses.”
Buyers may ask suppliers whether AI or machine learning is used as part of the products or services to be delivered under the contract (not just in bid-writing). (In-scope procurements where the delivered service may involve AI)
“Where AI is likely to be used in the delivery of a service, commercial teams may wish to require suppliers to declare this, and provide further details (see Example Disclosure Question 3).”
Contracting authorities should not discriminate against suppliers on the basis of their use of AI when interpreting disclosure question responses. (All in-scope procurements using Annex B disclosure questions)
“It is important that contracting authorities do not discriminate against particular suppliers in the use of these questions or in the interpretation of supplier responses.”
Buyers should plan for a general increase in bid volumes and clarification questions as AI enables more suppliers to bid more easily. (All in-scope buyers)
“Planning for a general increase in activity as suppliers may use AI to streamline or automate their processes and improve their bid writing capability and capacity leading to an increase in clarification questions and tender responses.”
This briefing is enkii's interpretation of the official document — the official text always governs.
Source document © Crown copyright, reused under the Open Government Licence v3.0 via the GOV.UK Content API. enkii tracks every Procurement Policy Note and briefs changes the day they land — see all briefings.