5x trends driving the public sector market in 2025

The public sector market is shifting, and suppliers that don't adapt are being left behind.

From English Devolution to Social Value, this article, powered by Tussell's market intelligence platform, unpacks the 5 biggest shifts transforming public sector sales in 2025, and offers practical steps you can take right now to stay ahead.

Whether you're planning for the next quarter or the next five years, these insights will help you future-proof your strategy for 2025, 2026, and beyond. Because in a fast-changing market, only the best data can keep you ahead of the curve.

Skip ahead to read about:

• #1 - The Procurement Act has landed
• #2 - English Devolution is ramping up
• #3 - Spending with SMEs is stalling
• #4 - Social Value is back
• #5 - Frameworks are more important than ever
• Conclusion

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📜 Trend #1: The Procurement Act has landed

The biggest shake-up to UK procurement in decades is now live.

Since 24th February 2025, buyers have had access to new tools like the Competitive Flexible Procedure (CFP) - which is already being used in 23% of above-threshold tenders (according to early Tussell data).

Plus: Open Frameworks and Dynamic Markets now let suppliers join partway through - no more “wait 4 years” to get on a key agreement.

Watch Tussell, the Cabinet Office, and the CMA's Procurement Act Webinar

🔍 What suppliers need to know:

• If you're not already, get familiar with the Procurement Act. 

  Why not read our guidebook to get started?

• CFPs aren't one-size-fits-all – always scrutinise the tender documents.

  • Stages, scoring and negotiation levers vary by buyer – there’s no universal playbook.

• Dynamic Markets and open frameworks are here – Tussell can help you identify which ones open doors in your market.

🔍 What buyers need to know:

• The CFP is a powerful commercial tool – if you're not using it, you're leaving value on the table.

• Dynamic Markets stay open, making them far more SME-friendly than traditional frameworks. They’re a great lever to boost your direct spend with smaller suppliers.

Learn all about the Procurement Act at Tussell's PA2023 Hub

🌹  Trend #1: English Devolution is ramping up

Devolution will reshape who buys what, and where.

With more powers shifting to regional Mayors and Combined Authorities, procurement is consolidating across transport, housing, and skills.

The English Devolution project won’t be completed in 2025, but significant progress has already been made.

Tussell’s 2025 English Devolution Report reveals that Local Government already accounts for 36% of public sector spending in England - a figure set to rise as local authorities take on more responsibilities from Central Government.

Learn how English Devolution is set to change public procurement

As devolution continues, the number of local authorities could halve. For suppliers, this means fewer procurement opportunities - but each one will be larger in value and broader in regional scope.

🔍 What suppliers need to know:

• Expect fewer, but larger, local contracts.

• New buyers like Greater Manchester and West Midlands Combined Authorities are becoming key accounts.

• As responsibilities shift, your go-to frameworks may change — stay on top of which frameworks your new buyers are using.
  
  

🔍 What buyers need to know:

• Strategic Authorities will inherit major procurement responsibilities from Central Government - now is the time to invest in the skills, teams and tools to manage them effectively.

• District Councils have deep local knowledge. As some are phased out, consider how to maintain service delivery tailored to highly localised needs.

• As local authorities and contracts consolidate, SMEs and VCSEs may struggle to compete. Build in accessibility and inclusivity to ensure these firms aren’t left behind.
  
  

💼  Trend #3: Spending with SMEs is stalling

Despite years of ambition, public spending with SMEs has stalled.

According to Tussell, the British Chambers of Commerce, and Autogen AI’s 2025 SME Procurement Tracker, public sector procurement with SMEs has flatlined at around 20% of total direct spend since 2019.

This has largely been the result of NHS and Central Government bodies failing to tangibly increase the proportion of their procurement going to SMEs. Local Government, by contrast, has consisitently increased this value year-on-year.

Discover which public sector buyers are actually spending with SMEs

🔍 What suppliers need to know:

• Central Government remains a difficult for SMEs to crack, but Local Government are still fertile territory for SME contracts.

• PPN 001 introduced new SME procurement targets - but real change depends on enforcement. Stay alert to how different buyers respond.
  
  

🔍 What buyers need to know:

• Driving up SME spend requires sustained focus and intent.

• Explore Tussell’s guide to increasing SME access in public procurement for practical steps to make your processes more SME-friendly.
  
  

🌱  Trend #4: Social Value is back

Social value is back at the heart of public procurement.

After being omitted from the final text of the Procurement Act, social value made a strong return in early 2025.

The February National Procurement Policy Statement (NPPS) and PPN 002 reintroduced an updated Central Government Social Value Model - and reinforced a significant shift from MEAT (Most Economically Advantageous Tender) to MAT (Most Advantageous Tender).

This change means that price alone is no longer the primary determinant of contract awards. Instead, suppliers must demonstrate how they offer the best all-around value, including their environmental, social, and community contributions.

Learn how the public sector is thinking about Social Value

In the June 2025 Spending Review, the Government further reinforced this direction, tying procurement to sustainable growth, with particular focus on green construction and engineering.

🔍 What suppliers need to know:

• Social value models vary by buyer - take time to understand the priorities of your target accounts.

• Regional approaches differ - Scotland, Wales, and Northern Ireland each have unique social value frameworks. Tailor your bids accordingly.

• Partnering with local SMEs can strengthen your offer - many local authorities value community-based delivery and will reward locally rooted supply chains.
  
  

🔍 What buyers need to know:

• Transparency is key - being as clear and upfront as possible about your social value requirements helps level the playing field, particularly for SMEs.

• Smaller suppliers often feel disadvantaged - clear guidance and proportionate expectations can support a more diverse, competitive supplier base.
  
  

📈  Trend #5: Frameworks are more important than ever

Frameworks continue to dominate UK public procurement, and their use is on the rise.

Tussell’s research shows that framework agreements are a defining feature of high-performing suppliers’ success.

In FY23/24, 48% of Strategic Suppliers’ contracts were awarded via frameworks - nearly double the market average.

Download Tussell's 2025 Public Sector Frameworks Report

Among the Tech Titans - the 150 top public sector tech suppliers - 56% of contracts are secured through frameworks, compared to just 35% among the rest of the tech supply base.

Frameworks are now the primary route to market in sectors like IT, facilities management, cyber security and recruitment.

🔍 What suppliers need to know:

• Different buyers use different frameworks - if you want to break into a new account, start by understanding which frameworks they rely on.

• Success increasingly depends on navigating the framework landscape strategically.
  
  

🔍 What buyers need to know:

• Frameworks can speed up delivery and reduce costs - but some experts claim they limit SME access and restrict market competition.

• Fed up of spending ages researching the right live frameworks for your procurements? Save time - and energy - with Tussell's Frameworks Finder.

Speak to the Tussell team about Frameworks Finder

🌄 Don’t just react to change - stay ahead of it.

2025 is a turning point for public sector sales.

From the arrival of the Procurement Act to the revival of social value, the pace and scale of change is unprecedented. For suppliers and buyers alike, old habits will no longer cut it.

Whether you’re trying to navigate new frameworks, respond to devolution, or hit SME targets, one thing is clear: you can’t afford to make decisions based on guesswork.

In a market this fast-moving, only high-quality data can show you where to focus, which doors are opening, and how to get ahead of your competitors.

📊 Tussell arms you with the data you need to adapt with confidence.

👉 Book a chat with our team to start using hard data to power your public sector strategy. Don’t get left behind.