PPN 08/23 on using standard contracts: the original guidance, explained

The key facts

• PPN 08/23 was issued in August 2023 and replaced PPN 04/14 and PPN 06/14.
• It applied to all central government departments, their executive agencies and non-departmental public bodies, with other public sector bodies invited to follow the same approach.
• It introduced the three Standard Contracts published by the Government Commercial Function and the Government Legal Department: the Model Services Contract, the Mid-Tier Contract and the Short Form Contract.
• Under this note, the Short Form Contract should not be used for above threshold procurements.
• Use of the Model Services Contract is encouraged where whole life value is around 20 million pounds or more, or where a contract is rated Gold on the Cabinet Office Contract Tiering Tool.
• The Mid-Tier Contract suits above threshold work below approximately 20 million pounds, and can be used below threshold for more complex or critical contracts.
• In-scope organisations were to apply the note as soon as practicable after publication, with the note acknowledging different levels of organisational maturity.
• PPN 08/23 has since been updated by PPN 013, issued in February 2025 and revised in April 2025.

What this PPN is and who it applied to

PPN 08/23 is the note that established the current standard contract suite in central government. The Government Commercial Function and the Government Legal Department published three standard contracts for use by government departments and many other public sector organisations, and this note directed in-scope bodies to use them instead of writing bespoke terms.

Its contents applied to all central government departments, their executive agencies and non-departmental public bodies. Other public sector bodies were invited to apply the same approach. Organisations were asked to circulate it particularly to those with commercial, procurement or contract management roles.

It also cleared the ground. PPN 08/23 replaced PPN 04/14 and PPN 06/14, consolidating the earlier standard terms position into a single note, and it stated that the suite of Standard Contracts is updated periodically and that the note would cover each future iteration.

On timing, the note was pragmatic. In-scope organisations should apply it as soon as practicable after publication, with explicit acknowledgement that different organisations are at different levels of maturity, may have complex operating environments, and that adoption may take longer for some than others.

What the PPN required

The central instruction is that where in-scope organisations are purchasing bespoke goods or services, or goods or services that cannot be facilitated by a suitable government framework such as a Crown Commercial Service framework, a Dynamic Purchasing System or a Low Value Purchase System, they should adopt one of the Standard Contracts as the basis for all relevant procurements rather than creating bespoke contracts.

The Model Services Contract is the template for complex services procurements that will typically require some form of formal dialogue or negotiation with potential suppliers, for example to clarify the scope of existing arrangements or desired service outcomes, or to ensure an appropriate balance of risk and reward. It is described as particularly suitable for business process outsourcing and ICT delivery services, and its use is encouraged where the likely whole life contract value is around 20 million pounds or more, or where a contract is rated Gold using the Cabinet Office Contract Tiering Tool.

The Mid-Tier Contract is for goods or services procurements which are not particularly complex and do not require formal dialogue or negotiation. It may be used where the likely whole life value is above the relevant procurement thresholds but below approximately 20 million pounds, and may also be used below the thresholds where a contract is more complex or critical.

The Short Form Contract is for low value goods or services procurements, to be used where the likely value is below the relevant procurement thresholds, unless the contract is more complex or critical, in which case another contract such as the Mid-Tier Contract may be used. Under this note it should not be used for above threshold procurements. All three templates are published on GOV.UK.

Why standardisation was the policy

The note gives a clear commercial case. Creating bespoke contracts creates additional expenditure, may increase negotiation and resource time, and risks departments reinventing contracts that already exist or failing to include contractual clauses that support government policies. It also risks inconsistent policy positions, which may confuse suppliers and create inefficiency through additional clarification questions during procurement.

The suite is designed to simplify the procurement process, support businesses, and create a level playing field for small and medium-sized enterprises. By setting out a consistent government approach to terms and conditions and to doing business with government, it aims to reduce administration, resource and legal costs, and negotiation time, and to aid consistency and compliance with relevant legislation and procurement policy.

The note places this within the Sourcing Playbook, which states that common goods and services should be purchased through a government framework and describes the Model Services Contract as a convenient and flexible starting point for a wide range of government services, providing contractual clauses to support Playbook policies.

There are exceptions. The Standard Contracts need not be used where a more suitable form of contract is available, such as departmental terms and conditions attached to purchase orders for very low value procurements, a government framework, or an industry-specific contract like those available for construction. In-scope organisations should always seek appropriate legal advice, since the templates need tailoring to specific procurements and department-specific needs. Bodies not in scope, such as NHS bodies, were asked to have regard to the Standard Contracts when updating their own terms.

How the position has moved on

PPN 08/23 has been updated. PPN 013 was issued in February 2025 and updated PPN 08/23 to reflect the terminology introduced by the Procurement Act 2023 and the Procurement Regulations 2024, which apply to procurements commenced on or after 24 February 2025.

PPN 013 was then revised again in April 2025, and that revision changed something of substance. It expanded the appropriate use of the Short Form Contract, allowing in-scope organisations to use it for the provision of non-complex goods and services above the relevant procurement thresholds, where it is proportionate and appropriate to do so and within limits the organisation puts in place. That directly reverses the position in PPN 08/23, which said the Short Form Contract should not be used for above threshold procurements.

Anyone reading PPN 08/23 today should therefore treat the structure, rationale and template descriptions as still recognisable, and treat the Short Form Contract restriction as superseded for procurements under the current regime. The note is also useful context for contracts awarded during its currency, since it explains the framing under which those terms were selected. It anticipated exactly this situation by stating that the suite is updated periodically and that the note would cover each future iteration.

Applying it in practice

The template selection logic set out here is still the one commercial teams use. Establish the likely whole life contract value, judge whether the requirement is complex enough to need formal dialogue or negotiation, and check the Contract Tiering Tool rating. Those three inputs point at the right contract far more reliably than value alone.

Check the framework route before the contract route. The note only asks for a Standard Contract where the purchase is bespoke or cannot be facilitated by a suitable government framework. If a Crown Commercial Service agreement covers the requirement, that is where the process should start.

Expect to tailor whichever template you choose, and take legal advice in doing so. Guidance notes sit alongside each template and appear throughout the contracts themselves, which makes the intent behind individual clauses easier to interpret when a supplier pushes back.

Feed experience back into the suite. The Standard Contracts are subject to ongoing continuous improvement and in-scope organisations are encouraged to share feedback on their use in practice, originally through the Standard Contracts Policy Team at the Cabinet Office.

How eSourcing Data helps

Standardisation only produces its promised savings if the same template is genuinely used the same way across an organisation. eSourcing Data records the contract type selected against each procurement, along with the value, complexity and tiering inputs behind the choice, so commercial leadership can see actual adoption rather than assumed adoption.

For contracts awarded under PPN 08/23, the platform keeps the relevant record accessible: which template was used, what was amended, and which obligations flowed from it. That matters because the standard terms selected in 2023 and 2024 are still governing live delivery, and the note that explains them is no longer the current one.

Because the templates are consistent, the obligations they create can be tracked systematically rather than contract by contract. eSourcing Data supports that monitoring alongside the notices, reporting and supplier management the wider regime requires, so the consistency achieved at drafting stage carries through into contract management and transparency.

What to do about it

1. 1Check the framework and government commercial tool options before defaulting to a Standard Contract.
2. 2Select the template using whole life value, complexity, likely dialogue or negotiation, and the Contract Tiering Tool rating.
3. 3Note that the restriction on using the Short Form Contract above threshold has since been relaxed by PPN 013, and work to the current note for live procurements.
4. 4For contracts awarded under PPN 08/23, keep a clear record of which template was used and what was amended.
5. 5Seek legal advice to tailor the chosen template to the specific procurement and department-specific requirements.
6. 6Use the guidance notes published alongside and within each template when interpreting clauses during negotiation.
7. 7Share practical feedback on the Standard Contracts so future iterations of the suite improve.