New legislation requires public bodies to consider wider social value
when awarding contracts. The author of the Public Services (Social
Value) Bill, comments on its implications
It is nearly two years
since I introduced a Private Members’ Bill on public services to the
House of Commons, as a newly elected Member of Parliament.
was simple: to change the way that we design public sector contracts so
that they include consideration not just of financial cost but also the
economic, social and environmental value they could create. This is
what I meant by ‘social value’. I also hoped my bill would open up more
contracts to smaller businesses, social enterprises and voluntary
organisations. I was inspired in part to do this following my experience
as a district councillor in Warwick, where I saw firsthand how
charities and voluntary organisations were losing out on contracts that
they might have had won if the submissions and the contracts themselves
had been better designed with social value in mind.
The bill has
now become the Public Services (Social Value) Act on the back of
unanimous support from both Houses of Parliament, and will be
implemented through public service contracts across public bodies.
believe that this has happened for a number of reasons. First, all
sides recognise that we need to consider more than just finances when
delivering public services. Public services can generate considerable
social, economic and environmental benefits for their communities. In
order to get the most from our public services, therefore, we need to
ensure that we design contracts that take these things into account and
build them into delivery.
Second, as we face stringent economic
times, we need to ensure that we achieve maximum value for money. By
using public service contracts to deliver benefits besides the services
themselves, we can reduce long-term costs and create stronger
Third, we need to diversify the types of
organisations that provide public services. Social enterprises,
voluntary organisations and small, socially responsible businesses have
the potential to deliver higher quality public services in the long term
and increase productivity – something that is in all our interests.
Engaging commissioners and communities
is an approach that has already been adopted by a variety of public
bodies, such as Durham County Council and NHS North West, and is
generally considered to be best practice. My Act will ensure that this
becomes standard practice when designing contracts. It seeks to instil
social value into the procurement process at the pre-procurement stage.
This means that when public bodies consider tendering out public
services, they ask themselves: “Can we use this contract to generate
additional social, economic and environmental benefits?”
answer is yes, public bodies should then consult with the community,
social enterprises, voluntary organisations and businesses to find out
the best way to deliver social value. This will ensure that this is not
just a ‘box-ticking’ exercise but one that allows commissioners and
communities to be as innovative as possible.
An example of social
value commissioning could be an adult social care service delivered by
an organisation that employs local residents and uses volunteers to
deliver the service. This would create social value through people
having a job where they may otherwise have been unemployed. It would
encourage active citizenship, and create better-designed services by
including local voices.
No one wants to put additional burdens on
public bodies or public service providers, and by consulting widely, I
hope that we can develop social value in a way that is flexible and
creates the best outcomes for communities.
Once this has been
done, contracts can be put out for tender and it will be up to
organisations – big and small – to show how they can deliver both
high-quality public services and social value. I believe that this will
level the playing field for a range of organisations that perhaps cannot
compete with larger businesses on cost alone, but can provide unique
benefits and excellent results.
The next stage for the Act is its
implementation. It is up to the government to decide when it will put
the legislation into practice, but I hope this will take place by the
end of the year. However, it will be up to organisations on the ground
to police implementation and ensure that public bodies place social
value at the heart of public service delivery – something that presents
both an opportunity and a challenge.
I believe this Act will make
a big difference to communities and has the potential to change the way
that we deliver public services for generations to come.
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