This week, the CBI published its new report, Valued Partnerships, which explores the use of social value in contracts between the public sector and private suppliers across the UK. The report argues that the piecemeal approach to social value so far has resulted in a confusing landscape for businesses and contracting authorities, and that clarity is needed to ensure the positive impacts of social value for communities and local economies are not lost because of this confusion.
It lays out a number of key recommendations to strengthen the role of social value in procurements and delivery, and make it more efficient and effective for businesses and public sector commissioners to work together to deliver billions of pounds worth of social impact each year.
Social value can be most simply described as the activities carried out by a business, charity, or social enterprise that helps support the long-term wellbeing of an individual, a community, or the whole nation. Whether focused on improving local employment or stimulating local economies, driving environmental protection, or contributing to the health and wellbeing of individuals, amongst other things, social value can generate significant benefits .
Government has already indicated their ambitions to see social value become an even more integral part of public spending, by creating a new social value model and introducing a minimum mandatory weighting of 10% social value for the selection of all central government contracts. The Cabinet Office is also providing training for 4000 procurement and contract management officials to ensure that departments are able to use social value effectively.
Business has an equally vital role to play in ensuring that social value is embedded more consistently throughout public-private partnerships and many firms are keen to demonstrate the good examples of social value they have already delivered. Construction, for instance, has been leading the way in designing, delivering, and measuring social value for years. As one of the largest infrastructure projects currently underway, HS2 has already shown the benefits of strong collaboration between suppliers and clients and the positive outcomes possible for local communities.
Calls for business and government to act
Yet there is still room for improvement. As well as calling for an updated definition of social value as laid out in the Public Services (Social Value) Act 2012, this new report highlights significant opportunities for making social value a key part of public procurement. These include five key steps government could take now to see immediate improvements:
- Providing an updated definition of social value for public contracts
- Changing procurement policies to ensure social value is central to how government purchases goods and services will benefit the whole of the UK
- Giving officials buying goods and services for the public sector the skills and training needed to use social value effectively
- Sharing the best examples of social value to help drive good practice across the UK
- Balancing local and national priorities to improve the chances of social value delivering the best outcomes for communities and the UK as a whole.
Taken together, these new recommendations look to build on the recent updated version of the government’s Outsourcing Playbook, and are aimed at ensuring public-private partnerships continue to deliver the high quality public services and infrastructure the country needs.
If you have any questions about this work, please contact Dr Joshua Pritchard, Senior Policy Adviser for public sector markets.