What is changing?
Subject to Scottish Parliament approval, the Procurement Reform (Scotland) Act 2014 (Thresholds) Amendment Order 2027 would increase contract value thresholds as follows from 1 April 2027:
Goods and services: increasing from £50,000 to £100,000 excluding VAT
Works: increasing from £2,000,000 to £4,000,000 excluding VAT
The Order changes the contract value thresholds under the 2014 Act. The higher thresholds for engaging the Public Contracts (Scotland) Regulations 2015 are unchanged.
Why now?
The thresholds have remained unchanged since 2014, when the 2014 Act received Royal Assent. Inflation has reduced the threshold contract values in real terms, bringing more lower-value contracts within the scope of the Act. This change aims to reduce that regulatory burden while retaining controls for regulated and higher-value procurement.
What does this mean for your organisation?
For contracting authorities, the change means greater flexibility and less administration when purchasing goods, services and works up to these raised thresholds.
For suppliers, particularly SMEs and third sector organisations, the changes extend the potential to compete for contracts up to the raised thresholds, saving time and compliance costs.
Support for a lighter-touch approach
The proposals follow a public consultation held between October 2025 and January 2026. Respondents generally supported increasing both the goods and services threshold and the works threshold, highlighting the cost of running and participating in regulated procurement exercises for lower-value contracts.
Already underway? The existing thresholds still apply
The draft Order does not impact regulated procurements which commence before 1 April 2027. The threshold increases would not apply to the award of contracts that are already in procurement on that date.
Community benefits: no change to the threshold
Although the consultation also explored reducing the community-benefit threshold, the draft Order leaves it unchanged at £4 million. The policy note records that community benefits can still be included below that value, so a lower-value contract need not mean leaving out a community benefit component.
What should you do now?
With the changes still subject to Parliamentary approval, contracting authorities should consider which internal processes and guidance may need updating. For exercises that may start around 1 April 2027, check when the procurement commenced before deciding which thresholds apply.
Suppliers should consider how the changes could affect their approach to lower-value opportunities.
To discuss what the proposals could mean for your organisation, contact our procurement team.
This article was co-authored by Trainee Solicitor at MFMac Antonia MacColl.
