Upcoming school uniform changes - Part 2 - Calculating procurement spend

In this blog, we look at how schools should work out the value of spend to determine the procurement route they should follow. We also suggest this is an area where further clarification of the rules would be welcomed and are seeking further guidance from Department for Education (DfE).

As mentioned in our earlier blog, if the estimated value of your school uniform contract is above the procurement threshold, currently £207,720 (including VAT), then a compliant regulated procurement process will need to be followed. If the estimated contract value is below threshold, then a minimum of three quotes should be requested.

The Procurement Act 2023 (PA 23) is clear that in estimating the value of a contract for goods, a contracting authority should take into account the maximum amount that it could expect to pay under the contract. For a school uniform contract this should include:

• The combined spend of all schools eligible to buy under the contract (and the potential impact of changes to the number of eligible schools)

• The value of any extensions or options

• The value of any price increases built into the contract over the term

• Expected spend on unsold stock when the contract ends

• Value added tax, where applicable.

Schools may have various sourcing strategies for school uniform. Traditionally schools may not have purchased their own stock of school uniform, instead relying on parents or guardians buying directly from the supplier or from volunteer organisations such as Friends or parent-teacher associations.

This could well change under the new DfE branded uniform rules. In order to meet the legal limit on the number of branded items of school uniform and PE kit that schools can require, schools may decide to purchase more uniform themselves, for example branded sports kit for sports teams rather than requiring all pupils to buy them.

One of the frequently asked questions is whether schools have to take into account spend by parents or guardians or volunteer organisations as well as their own spend.

There is a suggestion in the Procurement Act 2023 Guidance on Valuation of Contracts and the DfE recent Procuring school uniform supplies - GOV.UK that where a supplier receives additional amounts as a result of, or in connection with, the contract in addition to amounts the contracting authority expects to pay (in this context the monies payable to the supplier directly by parents or guardians) that this should also be taken into account in valuing the maximum amount payable under the contract. This approach is taken from the rules on valuing concessions contracts - where a supplier is given the right to exploit works or services and the rules on valuation are different. However, goods contracts cannot be concession contracts.

Unlike the Costs of school uniforms Guidance which is statutory and therefore binding on schools, the PA 2023 guidance and DfE guidance on Procuring school uniform supplies are recommended but not binding. In our view the approach represents a cautious approach to the PA 2023.

Conclusion

In practice, where the cost of school spend is anticipated to be just below the threshold spend, the value of any third party spend may be an additional factor to take into account.

However, our interpretation of the PA 2023 is that schools are not mandated to take into account parent, guardian or voluntary organisation spend which is outside the scope of a school supply contract in assessing if the value of a supply contract is likely to be over the procurement thresholds. It should be recognised that the current DfE guidance recommends a different approach, and we have asked for clarification on this.

The PA 2023 includes a duty to keep records and therefore schools should ensure that as part of their procurement strategy, they record how they have estimated spend to support their chosen sourcing route.

Notes: Schools should be aware that DfE Guidance also refers to outdated threshold levels, as from 1 January 2026 the threshold was reduced from £214,904 (including VAT) to £207,720 (including VAT).

How we can help you?

If you have any questions or need support with procurement issues, please get in touch. Our team can:

• Advise on procurement strategy, including direct awards

• Assist with preparing tender documents for complex procurements

• Advise on the approach to evaluation, the evaluation process and award of contracts under the PA 2023

• Assist with managing and defending procurement complaints and challenges

• Provide procurement compliance training.

For more information please contact Stephanie Rickard, Head of Procurement, or Matthew Wolton, Commercial Partner in our Academies team.