Businesses backing local young people to be prioritised for Government contracts

New rules for Government procurement will strengthen the bids of businesses that commit to their local communities and support young people into employment.

Changes will double the importance of creating local benefits when the government buys goods or services, ensuring spending directly creates training, work experience, and jobs in every postcode, with a particular focus on work to tackle local skills shortages and supporting young people in apprenticeships and work placements. For contracts worth £5 million or more, the score for bringing benefits to the local community will be raised from 10% to 20%.

For smaller contracts of less than £1 million, rules have been simplified to make it easier for smaller firms and local social enterprises to access these contracts. Changes will also help smaller, scaling and innovative businesses and civil society organisations who often find themselves locked out of contracts because of layers of red tape and burdensome requirements.

The new rules come part of a major package of reforms to boost local economies, and will apply to central government procurements. The government has committed to using its £90 billion annual purchasing power as a lever for economic growth in partnership with local authorities and regional mayors.

Implementation of updated rules will take effect from 1 January 2027 following detailed technical guidance in Autumn 2026.