Financial thresholds for UK and Scottish procurement regimes updated from 1 January 2026

New thresholds have been set out for devolved Scottish procurements and for all other UK public procurement exercises, and will apply to procurement exercises which commence on or after 1 January 2026.

Public procurement rules require contracting authorities and utilities to comply with regulated procurement processes where they intend to award any contract that exceeds a given “threshold” value. The relevant threshold value is set out in the relevant procurement regime and is updated every two years in accordance with the UK’s international treaty obligations under the World Trade Organisation’s Agreement on Government Procurement.

As such, the threshold values are the same under the rules applying to those buyers that are subject to the Procurement Act 2023 (i.e. any contracting authority in the UK other than a devolved Scottish authority, other than in particular cases) as they are under the devolved Scottish rules set out in the Public Contracts (Scotland) Regulations 2015, Utilities Contracts (Scotland) Regulations 2016, and/or the Concession Contracts (Scotland) Regulations 2016.

The Procurement Reform (Scotland) Act 2014 applies to lower value procurements in Scotland and the thresholds set out in that Act do not have to be revised every two years in line with the GPA and remain unchanged (£50,000 for goods and services and £2 million for works contracts).

Updated thresholds

All other thresholds (which are all inclusive of VAT as required by GPA rules) are set to either decrease or remain unchanged on 1 January 2026 when compared with the previous period from 1 January 2024 to 31 December 2025 (see our blog on the previous increases here). The changes to the thresholds for public contracts in Scotland under The Public Contracts (Scotland) Regulations 2015 are as follows:

Unusually this threshold review sees the majority of threshold values decreased rather than increased. That is because the GPA thresholds are expressed in “Special Drawing Rights” – a form of international financial instrument the value of which is based on a basket of currencies. In SDRs the thresholds have remained fixed. But as the pound has strengthened against the SDR, each SDR becomes worth less in GBP, and so the GBP figure decreases as the SDR figure stays the same.

The effect of that is that more contracts will be caught by public procurement rules. If the 2024 threshold had kept pace with inflation, the central government supplies and services threshold would be more than £150,000 and the works threshold more than £5.7m. As many authorities will be only too aware, inflation affecting construction works, materials and services has been even higher.

Contracting authorities and utilities who are subject to public procurement rules will therefore need to update their internal procedures (and their instinctive sense of what is and is not regulated) to ensure that contracts are awarded in compliance with procurement law from 1 January 2026.

If you would like to discuss the updated thresholds and how they may affect you and your contracting authority, please contact Jamie Dunne, Charles Livingstone, or your usual Brodies contact.