Citation, commencement and extent

1.—(1) These Regulations may be cited as the Single Source Contract (Amendment) Regulations 2026 and come into force on 5th June 2026.

(2) These Regulations extend to England and Wales, Scotland and Northern Ireland.

Amendment to regulation 11 of the Single Source Contract Regulations 2014

2.—(1) Regulation 11 (steps in determining contract profit rate) of the Single Source Contract Regulations 2014(2) is amended as follows.

(2) In paragraph (6)—

(a)after “component specified by the Secretary of State”, insert “(the relevant provisions)”;

(b)for “two percentage points”, substitute “ten percentage points”.

(3) After paragraph (6), insert—

“(6A) In specifying the relevant provisions, the Secretary of State must also specify an outcome that must be achieved in order for the incentive adjustment to be payable, and that outcome must—

(a)be capable of objective verification; and

(b)relate to the performance of the relevant provisions.

(6B) If assessing the outcome or the performance of the relevant provisions includes any element of judgement by one or both of the contracting parties, or any person associated with the primary contractor(3), that element must be capable of being determined by a suitably qualified independent person.

(6C) In determining the amount of the incentive adjustment, the Secretary of State must be satisfied that it is reasonable in the circumstances, having regard to the potential public benefit arising from its use.”.

Amendment to regulation 51 of the Single Source Contract Regulations 2014

3.—(1) Regulation 51 (matters on which the SSRO must give an opinion) is amended as follows.

(2) In paragraph (1)(a)(i), for “step 2 or 4” substitute “step 2, 3 or 4”.

Amendment to regulation 65 of the Single Source Contract Regulations 2014

4.—(1) Regulation 65 (modifications of these Regulations) is amended as follows.

(2) For paragraph (4)(a) substitute—

“(a)in paragraph (6)—

(i)for each “Secretary of State” there were substituted “contracting authority”;

(ii)for “ten percentage points” there were substituted “two percentage points”;

(aa)paragraph (6A), (6B), and (6C) were omitted;”.