PPN 026 doesn’t score your SME.It scores who you supply.
Four things worth doing before the autumn guidance lands, whatever size your business is. Published August 2026.
See the Executive Access PartnershipWhat you need to do
Skip the background if you’ve read a PPN before. This is the part that matters.
Check whether you’re actually in scope
Directly, if you bid for £1m+ central government contracts. Indirectly, if you supply a prime who does. In defence and GovTech, that’s most SMEs above a handful of staff.
Document your recruitment and progression process
One page is enough. It has to exist and be pointed to, not described from memory when a prime’s bid team asks.
Get pay and conditions data organised
Ready to hand over on request. Not reconstructed under deadline pressure the week a tender lands.
Name someone accountable for this evidence
So due diligence, yours or a prime’s, has someone to talk to instead of a gap.
You don’t need to win a million pound contract to lose one over PPN 026. You just need to be the supplier a prime can no longer afford to carry.
Three things to have in place before autumn
The detailed guidance isn’t out yet, but the direction is fixed. This is what to sort now, before a prime’s bid team asks for it under deadline pressure.
- A documented recruitment and progression process, one you can point to rather than describe from memory
- Pay and conditions data organised and ready to hand over, not reconstructed against a bid deadline
- A named person accountable for HR practice, so due diligence has someone real to talk to
What PPN 026 actually changed
In August 2026, the Cabinet Office published PPN 026, replacing the old Social Value Model with a version built around two outcomes instead of five, and six Model Award Criteria instead of seventeen. It applies to central government procurements commencing on or after 1 January 2027, with social value weighted at a minimum of 10% for contracts between £1m and £5m, and 20% above that.
That is a genuine narrowing. The old model asked bidders to speak to carbon reduction, community wellbeing, supply chain diversity and modern slavery risk alongside jobs and skills. The new one wants evidence of workforce practice, and not much else.
“Good jobs” is not a slogan under PPN 026. It is a scored criterion, and scoring needs evidence.
The six criteria split evenly across the two outcomes:
Create or retain quality jobs. Recruitment and retention practice that widens access and supports growth in high-potential sectors.
Fair working conditions. Going beyond the statutory floor on flexibility, union access and support for staff facing barriers to staying in work.
Fair pay. Above minimum wage as standard, with progression policies that actually retain people rather than just recruit them.
Training and retraining. Addressing real skills shortages, shaped with the community or cohort it’s meant to reach.
In-work progression. Clear routes into higher paid work through skills development, tied to measurable retention gains.
Talent pipeline. Placements, apprenticeships and outreach aimed at people who face barriers to entering the workforce.
The £1m threshold isn’t an exemption
Here is the detail most SME owners will read past. PPN 026 replaces the dedicated SME and VCSE award criteria that existed under PPN 002 with a proportionality check instead: contracting authorities are directed to research whether SMEs and VCSEs are active in the market before choosing which criteria to apply, so the criteria selected don’t lock smaller suppliers out. That’s a safeguard the buying authority applies when it frames the tender, not a protection that travels down the supply chain to subcontractors.
It’s also worth being precise about who this threshold actually screens out. In defence, GovTech and regulated tech, direct contracts and frameworks at or above £1 million are not the exception for SMEs, they’re routine. The threshold doesn’t function as a blanket exemption for this audience the way it might for a small local services supplier. Plenty of Meliorem’s client base will bid for, or already hold, contracts that sit squarely inside scope.
- SMEs bidding directly for qualifying contracts, common in defence and GovTech where values run high
- SMEs subcontracting to primes bidding on £1m+ central government work
- SMEs with no documented recruitment, pay progression, or training evidence, regardless of which route brings them into scope
A prime chasing a £5m contract carries a mandatory 20% weighting tied to good jobs and skills. If your business can’t hand them recruitment data, pay progression evidence or apprenticeship numbers on request, you become a liability in their bid rather than a line item in their supply chain. And if you’re bidding directly, that same evidence gap costs you the points outright.
What’s still missing, and what isn’t
The Cabinet Office has confirmed that detailed sub-criteria, evaluation methodology and a List of Community Programmes are due in guidance this autumn. That part genuinely isn’t published yet, and anyone telling you otherwise is guessing.
What is already confirmed and won’t move: the six Model Award Criteria, the £1m threshold, the 10% and 20% weightings, and the 1 January 2027 commencement date. Target cohorts likely to feature in the autumn guidance include people not in employment, education or training, people transitioning from education into work, care leavers, and people with long-term health conditions or disabilities.
PPN 026 published. Model Award Criteria, thresholds and weightings confirmed.
Sub-criteria, evaluation methodology and Community Programmes guidance due.
PPN 026 applies to in-scope procurements commencing from this date.
Why this is an HR problem, not a bid-writing one
The four steps above aren’t paperwork for paperwork’s sake. Recruitment practice, pay progression and workforce data are HR functions. Most SMEs under 50 people have never had to produce this evidence because nobody has asked for it. That changes the moment a prime’s bid team does, and it changes faster than the policy’s own January 2027 start date, because primes will be gathering supply chain evidence well before then.
This is precisely the gap fractional HR leadership closes. Not a policy binder nobody reads, but the operational evidence a prime’s procurement team, or your own bid, will actually ask for.
Frequently asked
Does PPN 026 apply to my SME directly?
If you bid directly for central government contracts worth £1 million or more, yes, and in defence and GovTech that’s common rather than rare. If you don’t bid directly, exposure still reaches you through subcontracting to primes bidding at that level, since they’ll need workforce evidence from their supply chain to score well.
When does PPN 026 come into effect?
It applies to procurements commencing on or after 1 January 2027, counted from the date a tender notice is published. Contracts already underway before then may continue under the previous model, PPN 002, during a transition period.
What are the six Model Award Criteria under PPN 026?
They sit under two outcomes, good jobs and skills, replacing the seventeen award criteria and five missions of the previous model. Full sub-criteria detail is due in guidance expected autumn 2026.
Has the autumn 2026 guidance been published yet?
Not as of writing. The Cabinet Office has confirmed sub-criteria, evaluation methodology and a List of Community Programmes are still to come. The core framework, thresholds and weightings are already fixed and won’t change.
What should an SME do now if it isn’t directly in scope?
Treat it as a supply chain readiness issue rather than a compliance deadline. Primes bidding on qualifying contracts will need workforce evidence from their subcontractors well before January 2027, so the practical deadline for SMEs is earlier than the policy’s own start date.
Evidence beats scramble
If your business supplies into defence, GovTech or regulated tech primes, the workforce evidence a bid team asks for in six months should already exist today.