New Procurement Policy Note (PPN) 07/20: how implementing WebContractor can help

The new Procurement Policy Note (PPN) 07/20, sets out the payment approach to take into account, in the procurement of major Government contracts. The PPN was introduced to update and replace the PPN 04/19 from 1st April 2021. 

Commercial, finance, and procurement heads should take action to apply this PPN when acquiring goods, work or services that have an anticipated contract value above £5 million per annum (excluding VAT).

This will cause an impact within the construction industry, with the Construction Playbook introduced to make it simpler. The new playbook provides guidance for public sector procurement in England, and although not legislation, it is likely to be adhered to within central Government, with Local Government also encouraged to follow suit. It will allow contracting authorities to define the level of compliance included in a contract – combining previous policies and focussing on the principles of fairness. KPIs and automation will be key drivers of ensuring this is productive.

Currently, the KPIs do not tackle payment issues but have addressed the Public Contracts Regulations (requiring 30-day payment at tiers one, two, and three) and the Government’s PPN 07/20. The new Procurement Policy Note ensures companies bidding for public projects (worth £5m+) can prove that 85% of their invoices are paid within 60 days – whilst also requiring them to detail how they plan to work towards achieving 95%, showing their commitment to fair payment practices.

At Open ECX, we appreciate the complications of trying to follow new policies and ensuring your business fully abides by the rules – our innovative subcontractor management solution, WebContractor, can help. WebContractor is a digital platform that provides contractors with full visibility of all subcontractor Applications for Payment or Invoices. WebContractor covers the majority of objectives in the Government’s new policy – helping to improve the payment process and taking away the stress. 

Everything is processed in real-time, with notifications and prompts sent to ensure the agreed timeframes are adhered to. WebContractor knows when a subcontractor’s Application for Payment or Invoice was submitted and by whom, who approved it for payment and when, and when it was paid. WebContractor provides all of the background information and KPIs to support a contractor, proving they’re being compliant.

As well as supporting your business through these new processes – WebContractor also increases efficiency within your admin teams, saving time and capital. Implemented with ease and at no extra cost to subcontractors, the software introduces a transparent management process.

Experts in leading, cloud-based eTrading technology, contact the Open ECX team today for further information on how WebContractor can help your construction business.

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