UK to score ‘social value’ in awarding contracts
The UK government has announced new measures to deliver social value through public procurement.
The model, announced by the Cabinet Office last month, will require government departments to assess and score suppliers on the social value they’d generate if awarded a contract. Such benefits include supporting COVID-19 recovery; tackling economic inequality; combating climate change; and driving equal opportunities.
The government also hopes the social value model will enable more SMEs and social enterprises to win government contracts and help to build a more diverse and resilient supplier base. “The new approach will apply tests that all bidders, irrespective of their size and type, will be capable of meeting, and therefore further levels the playing field for the UK’s small businesses, start-ups and voluntary and community sector organisations and social enterprises,” the Cabinet Office said.
However, value for money will still be paramount. When the government first floated the idea of a social value score in March 2019, it proposed that it would be given a 10% weighting when calculating how to award contracts. It does not confirm in the latest announcement whether this will be the case, saying only that “a bidder’s social value score will be incorporated into assessment of contracts”.
‘Value to the taxpayer should lie at the heart’
“Government has tremendous buying power, spending £49bn [US$63bn] each year on contracts for vital public services,” said Cabinet Office parliamentary secretary Julia Lopez. “Value to the taxpayer should lie at the heart of our procurement decisions. Too often, however, ‘value’ has been narrowly defined by price without taking into account other important factors such as the number of local jobs or apprenticeships a contractor will provide, the care they show the environment in their business practices or the number of SMEs involved in their wider supply chain.
“We want to see a greater variety of companies deliver government contracts, from every corner of our country – not just because that benefits local economies and communities but because it helps diversify our risk, create a more resilient supplier base and deliver some of our critical priorities.”
Arnab Dutt, the chair of the Social Value Policy Unit at the Federation of Small Businesses, added: “Social value has the potential to be transformational in bringing opportunity to all parts of our country and to the many small businesses that are the lifeblood of our communities.”
The new measures – which build on the Public Service (Social Value) Act 2012 by ensuring that all major procurements explicitly evaluate social value, rather than just consider it – will come into effect on 1 January 2021.
Commercial teams in all government departments will be expected to complete training courses in implementing the new model and ensuring the maximum social value is derived from each contract.
About Mia Hunt
Mia is a journalist and editor with a background in covering commercial property, having been market reports and supplements editor at trade title Property Week and deputy editor of Shopping Centre magazine, now known as Retail Destination. She has also undertaken freelance work for several publications including the preview magazine of international trade show, MAPIC, and TES Global (formerly the Times Educational Supplement) and has produced a white paper on energy efficiency in business for E.ON. Between 2014 and 2016, she was a member of the Revo Customer Experience Committee and an ACE Awards judge. Mia graduated from Kingston University with a first-class degree in journalism and was part of the team that produced The River newspaper, which won Publication of the Year at the Guardian Student Media Awards in 2010.
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