UK procurement: performance and KPIs Q&A

Question 1

When does the Act generally require at least three contract KPIs?

Accepted Answer

Before entering into a public contract with an estimated value above £5 million, the authority generally must set at least three key performance indicators.

The Act provides exceptions, including where performance cannot appropriately be assessed by KPIs and for certain contract types.

This is not a rule that every small contract needs exactly three measures.

Read the contract and governing regime, because the buyer can also impose useful performance measures beyond the statutory minimum.

Question 2

Does a contract over £5 million always need statutory KPIs?

Accepted Answer

No. The guidance identifies exceptions, including frameworks themselves, certain private-utility contracts, concessions and light touch contracts, as well as cases where KPI assessment would not be appropriate.

A qualifying call-off under a framework can still be subject to the requirement.

The threshold is therefore only one part of the analysis.

A bidder should establish the contract category and the proposed performance obligations rather than assuming that the headline value settles the position.

Question 3

Are the three published KPIs necessarily all the contract’s performance measures?

Accepted Answer

No. A contract can contain more than three KPIs, and the Act’s publication and assessment requirements distinguish the full set from the three regarded as most material for relevant notices.

Suppliers must understand the complete contractual performance regime, including measures not highlighted in a short notice.

Build the reporting plan from the signed agreement and schedules.

Treat the published snapshot as useful information rather than a substitute for reading the actual delivery obligations.

Question 4

How often is KPI performance information generally published?

Accepted Answer

Where the relevant statutory KPI provisions apply, performance is assessed and specified information published at least once in each twelve-month period during the contract and on termination.

The authority can assess performance more frequently, and the contract may require monthly or quarterly operational reports.

A supplier should align its internal evidence collection with those actual requirements.

Waiting for the annual public notice is too late to build reliable data about how the service performed during the year.

Question 5

What ratings are used in Procurement Act contract performance notices?

Accepted Answer

The published guidance lists Good, Approaching target, Requires improvement, Inadequate and Other, with defined descriptions.

These are the notice ratings; an authority may also use an internal performance scheme.

Suppliers should agree the underlying data, measures and reporting periods in contract management so the published assessment has a clear evidential basis.

A narrative claim of excellent service is weaker than contemporaneous records showing whether the agreed targets were met.

Question 6

Can the three KPIs reported in a notice change during a contract?

Accepted Answer

The notice should report the KPIs the authority regards as most material at that point, which may differ as a contract moves from mobilisation to steady-state delivery.

That is distinct from freely changing the contractual obligations themselves.

Amending a KPI may need to comply with the contract and procurement modification rules.

Maintain a versioned performance schedule so everyone can identify which measure, target and period support each assessment.

Question 7

Can poor performance on one contract affect later public tendering?

Accepted Answer

Potentially. The guidance connects certain breaches and poor performance with discretionary exclusion grounds and increased transparency through performance notices.

It does not mean any minor service issue creates an automatic ban.

Maintain accurate records, investigate failures, implement improvement actions and respond carefully to relevant tender declarations.

Good contract management supports future bidding because the supplier can explain both its delivery record and the evidence that any significant problem was addressed.

Question 8

How should a bidder design a credible KPI commitment?

Accepted Answer

Use a clear measure, defined baseline, target, data source, reporting period and accountable owner, then test whether the promised performance is operationally achievable.

Distinguish a service outcome from an activity count and identify dependencies outside the supplier’s control.

The Act defines a KPI as a measure for assessing contract performance, but the precise contract requirements determine what must be delivered.

A bid commitment should survive transfer to the delivery team without needing a new interpretation.

Question 9

Why should bid promises be included in the mobilisation handover?

Accepted Answer

The delivery team needs to know what was offered, how it will be measured and which commitments form part of the contract.

Public performance reporting increases the importance of a reliable record.

Provide the final response, agreed clarifications, contractual measures and evidence owners as a coherent handover.

Otherwise an attractive proposal can create obligations that operations did not resource.

This is practical implementation advice, not a claim that the Act prescribes one universal handover template.

Question 10

What should a supplier do before a public performance rating is finalised?

Accepted Answer

Reconcile the proposed assessment with the agreed measures, reporting period and underlying data, and raise factual errors through the contract’s governance process.

Keep evidence of service delivery, accepted dependencies and remedial action.

The authority has its own publication responsibilities, so the supplier should not assume it can veto an accurate notice.

The useful goal is a fair, evidence-based assessment and a clear improvement record where performance has fallen short.

UK procurement: performance and KPIs Q&A

When does the Act generally require at least three contract KPIs?＋

Does a contract over £5 million always need statutory KPIs?＋

Are the three published KPIs necessarily all the contract’s performance measures?＋

How often is KPI performance information generally published?＋

What ratings are used in Procurement Act contract performance notices?＋

Can the three KPIs reported in a notice change during a contract?＋

Can poor performance on one contract affect later public tendering?＋

How should a bidder design a credible KPI commitment?＋

Why should bid promises be included in the mobilisation handover?＋

What should a supplier do before a public performance rating is finalised?＋