Part 4: Management of public contracts Modifying public contracts Section 74: Modifying a public contract
This section sets out the circumstances under which public contracts may be modified during their term without the need to run a new procurement process under Part 3.
	Subsection (1) sets out that a contracting authority may modify a public contract or a convertible contract (a below-threshold contract that as a result of the modification will become a public contract), when a) the modification is expressly permitted under the grounds set out in Schedule 8; b) the modification is not a substantial modification; or c) the modification is a below-threshold modification.
	Subsection (2) sets out that a contracting authority may modify a public contract or a convertible contract if the contract is a light touch contract.
	Subsection (3) explains that a substantial modification is one that would increase or decrease the term of the contract by more than 10 per cent, materially change the scope of the contract, or materially change the economic balance of the contract in favour of the supplier.
	Subsection (4) explains that a modification is a below-threshold modification where it meets all of the following conditions: a) the modification would not increase or decrease the value of a goods or services contract by greater than 10 per cent, or a works contract by greater than 15 per cent; b) the aggregated value of below-threshold modifications would be less than the threshold applicable to that type of contract (Schedule 1 sets out the threshold amounts); c) the modification would not materially change the scope of the contract and d) the modification is outside the scope of subsection 1(a) (permitted under schedule 8) or 1(b) (non-substantial).
	Subsection (5) sets out that a reference to a modification materially changing the scope of the contract means making a modification that provides for the supply of goods, services or works of a kind that are not already provided for in the contract.
	Subsection (6) explains "the aggregated value of below-threshold modifications" referenced in subsection (4) is the estimated value of all contract modifications previously made that were deemed below threshold.
	Subsection (7) and (8) set out that if modifications could reasonably have been made together and that combined modification would not be permitted under subsection (1), the individual modifications (that could be combined) are also not permitted.
	Subsection (9) sets out that a contracting authority may not modify a public contract so as to change the supplier except as provided for by paragraph 9 of Schedule 8 (transfer on corporate restructuring).
	Subsection (10) makes it clear that Part 3 does not apply in relation to the modification of a contract under this section, meaning contracting authorities do not have to run a new procurement procedure if they are modifying a contract in accordance with this section.