PPN 08/23: Using Standard Contracts · first published 1 August 2023
PPN 08/23 instructs all central government departments, their executive agencies, and non-departmental public bodies (NDPBs) to use one of three government-published standard contract templates when buying bespoke goods or services outside a framework. The three templates are: the Short Form Contract (below-threshold, low-value work), the Mid-Tier Contract (above-threshold up to roughly £20m), and the Model Services Contract or MSC (complex or high-value services, typically £20m+). The policy replaces two older notes (PPN 04/14 and PPN 06/14) and applies as soon as practicable after August 2023. For small businesses, this means the contract terms you receive from central government buyers should become more consistent and predictable — reducing the legal review burden each time you bid.
WHO THIS APPLIES TO
THE ENKII VIEW
This is quietly good news for small businesses. Bespoke government contracts have historically been a barrier — they are costly and time-consuming to review and negotiate. Standardised templates mean a small firm that wins one central government contract will encounter broadly the same terms on the next, cutting repeat legal costs. The explicit goal of creating "a level playing field for small and medium sized enterprises" is stated in the document, suggesting the templates have been designed with supplier fairness in mind, not just buyer convenience.
1. Download and read all three Standard Contract templates (Short Form, Mid-Tier, and MSC) from GOV.UK before your next bid so you know the terms in advance — saving you legal review time mid-procurement.
All SMEs bidding for central government contracts — The document states the Standard Contracts are designed to 'reduce administration, resource (including legal) costs and negotiation time' — familiarity upfront means you can price and plan accurately.
2. Familiarise yourself with the Model Services Contract (MSC), including its risk and reward clauses, so you can respond confidently during any formal dialogue or negotiation stage.
SMEs bidding for central government services contracts likely to be valued at £20m+ over their full term — The MSC 'is designed as a template for complex services procurements which will typically require some form of formal dialogue or negotiation with potential suppliers' and is the expected vehicle for contracts rated Gold or £20m+.
3. Review the Mid-Tier Contract template before submitting proposals so your pricing and delivery model reflect its terms without surprises at contract award.
SMEs bidding for above-threshold but lower-value central government contracts (below ~£20m) — The Mid-Tier Contract is the expected template for contracts 'above the relevant procurement thresholds, but falls below approximately £20m' — the sweet spot for many SME opportunities.
4. Check whether the buyer is using the Short Form Contract; if so, note it cannot lawfully be used for above-threshold work — if your contract grows, expect a switch to Mid-Tier terms.
SMEs doing low-value, below-threshold central government work — The document states the Short Form Contract 'should not be used for above-threshold procurements', so a contract that grows in value may need to be re-let or renegotiated under different terms.
5. If a buyer issues you a Standard Contract template for work that would normally use an industry-standard form (e.g. JCT or NEC in construction), flag this to the buyer — the PPN explicitly exempts 'industry-specific contracts, such as those available for construction'.
SMEs in construction or other industries with established standard contract suites — The document confirms Standard Contracts 'need not be used where a more suitable form of contract is available... such as those available for construction', giving you a legitimate basis to request the appropriate form.
6. Send any practical feedback on the Standard Contracts to modelservicescontract@cabinetoffice.gov.uk — this is your channel to influence future iterations of the templates.
SMEs that repeatedly bid for central government work — The document states 'The Standard Contracts will be subject to ongoing continuous improvement and we value feedback on their use in practice', and provides this contact email for that purpose.
Every rule below quotes the official document verbatim.
The rules bind all central government departments, their executive agencies, and NDPBs; other public sector bodies (e.g. NHS) are encouraged but not required to follow. (All in-scope organisations (central government departments, executive agencies, NDPBs))
“The contents of this Procurement Policy Note (PPN) apply to all Central Government Departments, their Executive Agencies and Non-Departmental Public Bodies and are referred to in this PPN as 'In-scope organisations'.”
In-scope organisations must use a Standard Contract as the basis for procurements of bespoke goods or services not covered by a suitable government framework. (In-scope organisations, all values, all sectors (where no framework applies))
“Where In-Scope Organisations are purchasing bespoke goods or services, or goods or services that cannot be facilitated by a suitable government framework, such as a Crown Commercial Service Framework, Dynamic Purchasing System, or Low Value Purchase System, they should adopt one of the Standard Contracts as the basis for all relevant procurements, rather than creating bespoke contracts.”
The Model Services Contract (MSC) is encouraged where the contract value over its full term is £20m or more, or where the contract is rated 'Gold' using the Cabinet Office Contract Tiering Tool. (In-scope organisations; complex/high-value services contracts £20m+)
“Use of the MSC is encouraged where the likely contract value (over the whole of the intended contract term) is £20m or more, or where a contract is rated 'Gold' using the Cabinet Office Contract Tiering Tool.”
The Mid-Tier Contract is for goods and/or services procurements above the relevant procurement thresholds but below approximately £20m, or for more complex/critical contracts below those thresholds. (In-scope organisations; contracts above procurement thresholds and below ~£20m)
“The Mid-Tier Contract may be used where the likely contract value (over the whole of the intended contract term) is above the relevant procurement thresholds, but falls below approximately £20m. It may also be used if a contract is more complex or critical, but below the relevant procurement thresholds.”
The Short Form Contract is for low-value goods and/or services below the relevant procurement thresholds and must not be used for above-threshold procurements. (In-scope organisations; below-threshold, low-value contracts)
“The Short Form Contract should be used where the likely contract value is below the relevant procurement thresholds, unless the contract is more complex or critical, in which case, another contract, such as the Mid-Tier Contract may be used. It should not be used for above-threshold procurements.”
Standard Contracts need not be used where a more suitable contract form already exists, such as departmental purchase-order terms for very low-value work, a government framework, or an industry-specific contract (e.g. construction). (In-scope organisations, all values)
“The Standard Contracts need not be used where a more suitable form of contract is available - for example, Departmental terms and conditions attached to purchase orders for very low value procurements, a government framework, or an industry-specific contract, such as those available for construction.”
The stated policy intent is to create a level playing field for small and medium-sized enterprises (SMEs) by providing consistent terms and reducing administration, legal, and negotiation costs. (All suppliers including SMEs bidding for central government contracts)
“The suite of Standard Contracts is designed to simplify the procurement process, support businesses, and create a level playing field for small and medium sized enterprises.”
In-scope organisations should apply the PPN as soon as practicable after its publication date of August 2023; adoption timelines may vary by organisation. (In-scope organisations; from August 2023)
“In-scope Organisations should apply this PPN as soon as practicable after its publication date. It is understood that different In-Scope Organisations are at different levels of maturity and may have complex operating environments in terms of adopting the Standard Contracts, and adoption may take longer for some organisations than others.”
This PPN replaces PPN 04/14 and PPN 06/14. (In-scope organisations)
“This PPN replaces PPN 04/14 and PPN 06/14.”
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.