It is now nearly 3 months since the Procurement Act 2023 came into force. The jury is out whether the Act will bring about significant change and encourage new entrants into public procurement enabling a mixed economy and more social innovation as advocated by the current Minister, Georgina Gould.

Research carried out by Aspire’s BetterforUs campaign shows that since the Act was implemented not one public authority has chosen to make use of a powerful tool that can address labour disadvantage through reserving opportunities to tender for organisations that help to build inclusive economies.

Public money should work for public good. Reserved contracts are a useful tool for making this happen. They enable public authorities to use procurement as a tool to build a fairer and or inclusive economy.

BetterforUs promotes the use of reserved contracts as a mainstream route to good work. Too many disabled and disadvantaged people are locked out of decent employment. Mainstream procurement often favours large providers with little accountability to place or people. Reserved contracts help reverse that dynamic by making space for community-rooted organisations which can provide real pathways into decent work.

Under Section 32 of the Procurement Act 2023, contracting authorities can limit competition for certain contracts to organisations that exist to support disabled or disadvantaged people into work. This offers a practical way to tackle inequality, grow the everyday economy, and widen access to good jobs for people who are often furthest away from it.

A reserved contract is a procurement opportunity that is set aside so only eligible supported employment providers can apply. These providers must:

• operate wholly or partly to employ or support disabled or disadvantaged individuals, and
• ensure that at least 30% of their workforce, or the team delivering the contract, come from these groups.

Under the Act, the approach is flexible and allows for a wide range of service types—cleaning, grounds maintenance, catering, care, digital, training—and various delivery models including partnerships and joint ventures.

The law deliberately keeps the definition of “disadvantaged” broad to reflect changing social policy. It recognises that disadvantage comes in many forms—long-term unemployment, caring responsibilities, single parenthood, mental or physical health conditions, or systemic discrimination.

Contracting authorities must:

• use the “competitive flexible procedure”* and specify the reserved status in all procurement notices.
• check that suppliers meet both criteria: a core purpose of employment or support, and a 30% threshold.
• consider market readiness and undertake early engagement to shape contract size and scope in ways that attract supported employment providers.

Section 32 allows for:

• whole organisations to bid, so long as 30% of their overall staff are disabled or disadvantaged.
• divisions of larger organisations to qualify, as long as the division delivering the work meets the threshold.
• consortia or partnerships, where the combined delivery team across all partners meets the 30% requirement.

We are actively working with local authorities, housing associations, and NHS bodies to:

• raise awareness of Section 32 and how to use it confidently
• encourage the wider use of reservation of contracts in the provision of goods and services
• champion the Real Living Wage, job security, and progression within reserved contracts

When designed well reserved contracts, bring better outcomes, deeper value for money, and more resilient local economies. Section 32 gives public bodies the authority—and the opportunity—to reshape who benefits from public spending. They open a door to those who have been shut out for too long. Let’s use the tools we have. Let’s make change happen.

*The competitive flexible procedure is one of two procedures created by the Act. It enables authorities to design their procurements subject to having regard to issues such as procurement objectives, transparency and time limits laid down by the Act.