How Promoting Social Value in Public Contracts Should be the Icing on the Procurement Cake

Bake-off-picture

First published on Procurious 5 January

Well, what a task! I’ve just finished commenting on the draft statutory guidance to implement the Procurement Reform (Scotland) Act, perhaps, one of the most ambitious pieces of public procurement legislation that the world has ever seen!

Worryingly, in amongst the feedback from colleagues, is the concern that including social value considerations in contracts would push up the contract price (Here, in Scotland we call them Community Benefit Clauses).

This view was echoed at the 2015 CIPS conference where lawyer David Hansen cautioned against going overboard when applying social value provisions.

But does including an element relating to social value really have to cost much more? Isn’t it something where the public sector can rightly use to take action to put the icing on the cake of great procurement?

Absolutely I say! And while I may not come close to Mary Berry’s cake making, here’s my recipe for success when it comes to Social Value Clauses.

Helen’s Recipe for the Perfect Social Value Clause

  1. Sift the social value clause into a bowl.

Social Value clauses (aka community benefit clauses) are really in vogue in Scotland just now. They’ve been included in all sorts of construction projects to generate thousands of opportunities for apprentices in the building industry, working on things like the facilities for the Glasgow Commonwealth Games or the new Forth Road Crossing.

I actually don’t know of many local authorities this side of Hadrian’s Wall who haven’t managed to get an apprenticeship or student placement into one of their major works contracts.

But it’s not just works contracts where social value can be included.

We’ve managed to secure community benefit clauses in our services contracts for things like sponsored places for the third sector at conferences and additional contact time for people receiving care at home from the supplier who delivers pre-prepared meals.

The key is, as David Hansen rightly advised CIPS colleagues, to keep things proportionate to the contract and sift out the irrelevant that will add cost.

I mean, you only need a bit of innovative thought. Just what social value can a Peterborough based IT system supplier to your Benefits Service provide when you’re based in the Outer Hebrides? IT prizes for schools? Maybe a couple of tablet PCs for people most in need?

  1. Mix in the Third Sector when it starts to boil

Keeping third sector organizations hot, engaged and ready to tender for public contracts can give a real extra dimension to the value you can achieve.

Not only will you have secured savings and benefits arising from a fabulously crafted specification and procurement strategy, but you’ll also be able to award the contract to a third sector organisation whose sole purpose is to give something back.

Awarding a contract to a third sector provider will mean your social value can really start to rise.

Awarding a community transport contract to the third sector means the outreach work they do with vulnerable people is safeguarded as they can now spread their overheads, admin and fleet costs, across more than one income stream.

What about a car maintenance contract, which, if awarded to a garage run by the third sector, can provide work placement opportunities to men who’ve been unemployed for a considerable length of time and who perhaps need a bit more support due to addiction problems or mental health issues?

You see, you can never add too much of the third sector to your recipe; the key is to make sure they’re hot and ready to bid.

  1. Finally, add the secret ingredient

Just when you think you’ve created the best social value cake you can, you need to add the pivotal secret ingredient that’s going to win you the procurement bake off prize;

User engagement and participation in the process.

Delivering real social value must be about putting service users and the community at the heart of what procurement does. Where our contracts affect people’s lives we should be out there asking them what outcomes they want to see delivered and getting them to make the choices about which supplier is used.

We’ve being pushing the boundaries up here in the Outer Hebrides through our participatory budgeting bus services project in Uist and Barra (check out @YourBus for details). But we’re not alone, Orkney have done a great job by engaging with users and carers to commission services and there’s been innovative engagement with deaf service users as part of procurement processes in Nottingham.

Putting the people who matter at the heart of the process not only means better contracts and potential reductions in cost but also, and perhaps most importantly, the legacy of a group of people whose confidence has grown.

Social Value must be at the Heart of every Procurement Recipe

Social Value does not need to be expensive, nor does it need to be ‘an optional extra’. When you view it as part of the recipe for public contracts, it’s that extra ingredient that takes the cake from average to amazing.

And suddenly, you’ll be delivering more than just contracts, you’ll be making a difference to the people your organisation is there to serve.

So why not try my recipe for social value and maybe you can win first price in the Great Procurement Bake Off!