Background: Social Partnership and Public Procurement (Wales) Act 2023

The Act, which received Royal Assent in 2023, sets out a new statutory framework to embed social partnership principles into public sector decision-making and procurement activity across Wales. It requires contracting authorities to take all reasonable steps to achieve socially responsible procurement objectives, ensuring that public spending supports not just economic but also social and environmental outcomes.

The Act applies to a defined group of contracting authorities listed in Schedule 1, encompassing a wide range of public sector bodies in Wales. While not extending directly to private sector entities, the Act actively encourages wider adoption of its principles by all organisations engaging in or benefiting from public procurement.

Consultation Overview: What’s Being Proposed?

The consultation document provides draft secondary legislation that aims to give legal effect to key provisions under the Act. The proposals address definitions, reporting requirements, and criteria for contract categorisation.

Definition of “Prescribed Contracts”

The consultation expands the scope of prescribed contracts, building on the existing definition of “major construction contracts” and outsourcing agreements. Under the proposed Regulations, any contract for works, goods, or services, including framework agreements, will be considered a prescribed contract if it

• Exceeds the financial thresholds defined in Schedule 1 of the Procurement Act 2023; and
• Is not exempt under that Act.

Contracting authorities will be required to take all reasonable steps to advance their socially responsible procurement objectives when procuring under such contracts.

Contract Registers

Section 40 of the Act introduces the requirement for contracting authorities to maintain a publicly accessible contract register. The draft Regulations define “registerable contracts” as those meeting the following criteria:

• They are public contracts for works, goods, or services (including framework agreements);
• They exceed the threshold for a “notifiable below-threshold contract” – typically £30,000 or, in some cases, £12,000;
• They are not exempt under the Procurement Act 2023.

Importantly, the draft Regulations clarify that concession contracts and utilities contracts are excluded.

Annual Reporting Requirements

Section 39 of the Act mandates an annual report from contracting authorities. The draft Regulations supplement this requirement by listing the types of information that must be disclosed, including:

·           The proportion of contracts awarded to suppliers who:

–  Are based in Wales,

–  Are SMEs or value-driven non-governmental organisations,

–  Are Accredited Living Wage Employers,

–  Recognise trade unions and/or negotiate terms with them,

–  Have no zero-hours workers or actively review such arrangements,

–  Provide opportunities for Welsh language development,

–  Have carbon reduction plans and environmental policies,

–  Have an Equality, Diversity and Inclusion policy with staff training,

–  Are signatories to the Code of Practice on Ethical Employment in Supply Chains.

These data points aim to promote greater transparency and accountability across the public sector supply chain.

Draft Model Clauses: Geldards’ Role in Legislative Development

As part of the implementation of the Act, the Welsh Ministers instruted Geldards to draft model clauses for public procurement contracts that will help contracting authorities comply with their new statutory duties under Part 3, Chapter 2 of the Act.

The draft clauses cover a wide range of areas aligned with the Act’s core themes of fair work, sustainability, transparency, and social justice. These clauses may form the basis of official guidance or legal instruments issued by the Welsh Government.

The model clauses we have drafted are structured, in accordance with the requirements of the Act, as follows:

• Schedule 1 – Payment
• Schedule 2 – Employment
• Schedule 3 – Compliance
• Schedule 4 – Training
• Schedule 5 – Sub-contracting
• Schedule 6 – Environment
• Schedule 7 – Transparency

These draft clauses are being considered alongside the wider consultation and are designed to help contracting authorities embed socially responsible practices in major construction and outsourcing contracts, as well as more broadly across the procurement lifecycle.

Looking Ahead

Still to come from the Welsh Government are:

• Draft Social Public Works Clauses applicable to major construction contracts, and
• Draft Workforce Clauses tailored to outsourced service contracts.

These will further clarify how contracting authorities can implement the Act’s principles operationally through specific procurement categories.

The current consultation marks an important step in the realisation of a more ethical, inclusive, and sustainable public procurement regime in Wales. It offers stakeholders across the public, private, and third sectors an opportunity to contribute to shaping legislation that aligns economic activity with social progress.

Have Your Say

Stakeholders are encouraged to read and respond to the consultation, which is available at:

https://www.gov.wales/socially-responsible-public-procurement

Responses can be submitted until the deadline stated on the consultation page. Geldards will continue to monitor developments and publish further updates as the secondary legislation and guidance evolve.