Procuring steel in government contracts: the 2023 guidance (PPN 04/23), explained

The key facts

• PPN 04/23, issued in March 2023, replaced PPN 11/16 and applied with immediate effect.
• It applied to central government departments, executive agencies and non-departmental public bodies conducting procurements under the Public Contracts Regulations 2015 (Part 2), the Utilities Contracts Regulations 2016, the Defence and Security Public Contracts Regulations 2011 and the Concessions Contracts Regulations 2016, wherever steel was procured directly or indirectly.
• The manufacturing of basic iron and steel supported around 39,000 jobs in steel production and a further 60,000 in upstream supply chains, on 2021 figures.
• In-scope organisations were already required to provide an annual steel data return: pipeline data on projected steel requirements plus actuals on steel procured in the previous year, covering quantity, product type and origin.
• Actuals reporting applied to projects of £10 million or more, and to smaller projects expected to require more than 500 tonnes of steel.
• Data had to be submitted to the Department for Business and Trade within 10 weeks of the end of the financial year, with origin recorded per the Inspection Certificate (EN10204 Type 3.1) and an indication of where the steel was melted and poured.
• The PPN updated steel procurement to reflect the post-2016 policy landscape: the National Procurement Policy Statement, the Construction Playbook, the Social Value Model, Supply Chain Visibility and the Value Toolkit.
• It followed the Steel Procurement Taskforce, launched in March 2021, whose final report in February 2022 recommended new technologies, better data and greater transparency.

What PPN 04/23 is and who it applied to

Procurement Policy Note 04/23, issued in March 2023, was the government's revised guidance on procuring steel in public contracts. It replaced PPN 11/16 and refreshed the policy to reflect changes in the project appraisal and commercial landscape since 2016, while clarifying the scope of reporting requirements on steel origin data. The context was economic as well as commercial: on 2021 figures, basic iron and steel manufacturing supported around 39,000 well-paid jobs in production and a further 60,000 in upstream supply chains, and the public sector is a significant buyer of steel for railways, roads, buildings, defence equipment, schools and hospitals.

The PPN applied to central government departments, executive agencies and non-departmental public bodies conducting procurements covered by Part 2 of the Public Contracts Regulations 2015, the Utilities Contracts Regulations 2016, the Defence and Security Public Contracts Regulations 2011 and the Concessions Contracts Regulations 2016, wherever steel was being procured directly or indirectly. The note called this relevant steel procurement. Other public sector authorities were encouraged to apply the approach where relevant and proportionate, with local authorities reminded to do so in light of section 17 of the Local Government Act 1988 and their Best Value Duty.

What it asked buyers to do

Rather than inventing new mechanisms, PPN 04/23 pointed buyers at the policy toolkit that had grown up since 2016 and asked them to design steel procurements with it in mind: the Infrastructure and Projects Authority's Project/Programme Outcome Profile, the National Procurement Policy Statement (PPN 05/21), the Construction Playbook (PPN 09/20), the Social Value Model (PPN 06/20), Supply Chain Visibility (PPN 01/18) and the Value Toolkit.

Together, the PPN said, these emphasise a consistent set of disciplines: strong business cases aligned with government policy objectives on social value; driving the business case objectives through all subsequent policy and procurement design; delivering best value over the life of the asset rather than lowest capital cost; adopting commercial best practice and a suitable delivery model; undertaking pre-market engagement involving the whole supply chain, so buyers understand market capability and capacity and suppliers can see future opportunities; taking account of wider social, economic and environmental considerations; ensuring a level playing field for all suppliers; and securing value for money for the taxpayer.

In-scope organisations were expected to have consideration for these policies when designing relevant steel procurements and to apply them in accordance with the instructions in each case, with the accompanying guidance filling in the detail.

The steel reporting requirement

The PPN's hardest edge was data. In-scope organisations were already required to provide an annual steel data return in two parts: pipeline data on projected steel requirements, and actuals data on steel procured in the previous year covering quantity, product type and origin.

For the actuals element, PPN 04/23 applied the requirement to projects and programmes valued at £10 million or more, and to those below £10 million where more than 500 tonnes of steel was anticipated. Returns had to reach the Department for Business and Trade within 10 weeks of the end of the financial year. Steel origin had to be recorded as set out in the Inspection Certificate (EN10204 Type 3.1), with contractors indicating whether the stated origin was also recorded in the certificate as the place where the steel was melted and poured.

The guidance accompanying the PPN set out the full requirement, including which steel product types were in scope, and provided an example clause so that the data obligations could be pushed down to suppliers through contractual terms and conditions. That last point matters in practice: without a flow-down clause, the buyer carries a reporting duty its contractors have no obligation to service.

Why it mattered, and where it sits now

PPN 04/23 grew out of the Steel Procurement Taskforce, launched in March 2021 with the six major UK steel producers, UK Steel, trade unions and the devolved administrations. The Taskforce's final report, published in February 2022, recommended developing new technologies, improving data and promoting greater transparency. The PPN's tightened origin reporting was a direct answer to the data and transparency points, giving government a clearer picture of where the steel in public projects actually comes from.

Readers should note the document's place in the timeline. PPN 04/23 states that it replaces PPN 11/16, and it was written for procurements under the previous procurement regulations. Steel policy has since been carried forward for procurements under the Procurement Act 2023 by a later note, PPN 022, first issued in June 2025, which retains the annual data return and the £10 million or 500 tonne reporting thresholds and adds a transparency measure on the use of UK-produced steel. Organisations working on procurements begun under the old regulations, or reviewing how their steel reporting obligations evolved, will still find PPN 04/23 the relevant reference for that period.

How eSourcing Data helps

Steel reporting is, at heart, a data collection exercise that spans years and many suppliers. eSourcing Data keeps the thread intact: contract records can carry the steel data clauses, supplier submissions can be gathered and stored against each contract, and reporting tools help teams assemble the quantity, product type and origin data their annual return to the Department for Business and Trade requires.

The PPN's design disciplines also map onto the platform. Pre-market engagement can be run and documented through supplier engagement features, so the whole supply chain sees future steel requirements early. Published notices and evaluation records evidence the level playing field the PPN demands, and the audit trail preserves how social value and whole-life value considerations shaped each procurement decision.

For local authorities applying the approach voluntarily, templates make it straightforward to adopt the same clauses and data fields as central government without building the machinery from scratch.

What to do about it

1. 1Identify which of your projects met the reporting thresholds: £10 million or more, or over 500 tonnes of anticipated steel.
2. 2Include the example flow-down clause, or an equivalent, in contracts so contractors are obliged to supply quantity, product type and origin data.
3. 3Collect origin data in the form the PPN specifies: the EN10204 Type 3.1 Inspection Certificate, noting where the steel was melted and poured.
4. 4Diarise the annual return: collated data must reach the Department for Business and Trade within 10 weeks of financial year end.
5. 5Design steel procurements against the referenced policy set, including the Construction Playbook, Social Value Model and National Procurement Policy Statement.
6. 6Run pre-market engagement with the whole steel supply chain and record it, so capability, capacity and future pipeline are understood on both sides.
7. 7For procurements under the Procurement Act 2023, check the current steel PPN in the 022 series for the requirements that now apply.