Outsourcing by type and sector

Outsourcing is an arrangement under which an organisation contracts with a service provider to perform services that the organisation currently performs in-house or which are performed by an existing third party supplier. The outsourcing provider will instead provide those services using their own personnel and, often, facilities. This subtopic contains precedents and practical guidance for specific types of outsourcing transaction (for example, in relation to financial services or the public sector).

The outsourcing topic is divided into four subtopics, each covering a specific phase of an outsourcing transaction as follows:

  1. Preliminary issues—issues for consideration in the early stages of a transaction, from initial planning through to bidder selection. See: Preliminary issues in outsourcing—overview

  2. Outsourcing agreements—precedents and detailed guidance on the key issues to consider when drafting and negotiating an outsourcing agreement. See: Outsourcing agreements—overview

  3. Contract management in outsourcing—issues arising after the date of signature including governance, change and disputes. See: Contract management in outsourcing—overview

  4. Outsourcing by type and sector—specific guidance on certain types of transaction including public sector, financial services and international (see below)

The Outsourcing transaction toolkit is

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Cabinet Office updates PPNs on data protection and payment spot checks

The Cabinet Office has added two new Procurement Policy Notes (PPNs) to the suite of PPNs republished in conjunction with the Procurement Act 2023 (PA 2023) go-live—PPN 020: Guidance on data protection legislation and PPN 021: Payment Spot Checks in Public Sub-Contracts. PPN 020: Guidance on data protection legislation provides updated guidance on relevant data protection requirements under the UK GDPR and the UK International Data Transfer Agreement (IDTA) governing the export of personal data from the UK. PPN 020 applies with immediate effect. It replaces PPN 03/22 which contained streamlined guidance and updated model clauses to take account of the UK’s exit from the EU. It also includes guidance on international transfers of personal data. PPN 020 does not constitute a change in policy, but in-scope organisations should circulate and adhere to the guidance and use the updated model clauses at Annex A for new contracts. PPN 021: Payment Spot Checks in Public Sub-Contracts provides guidance and templates for contracting authorities to spot check public contract supply chains to ensure suppliers meet the payment terms set out in PA 2023. PPN 021 includes additional guidance on how in-scope organisations should conduct spot checks to ensure the correct payment terms are being included and adhered to by suppliers, plus model terms at Annex A which support spot checks being carried out. PPN 021 applies from 1 October 2025. Both PPNs apply to all central government departments, their executive agencies and non-departmental public bodies.

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