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GOVERNMENT SET TO PUT SOCIAL VALUE ‘AT THE HEART’ OF FUTURE SERVICE PROCUREMENT

The government is set to put social value ' at the heart' of future service procurement, writes Herpreet Kaur Grewal.

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01 April 2019 Herpreet Kaur Grewal


Businesses that want to secure future government contracts are being urged to show that they can help to improve society by tackling issues such as modern slavery and climate change.


In a speech last month, Minister for the Cabinet Office, David Lidington, announced that government contracts are to be awarded based on a consideration of their social impact, including such issues as employment of disabled people, use of small businesses, prevention of modern slavery and protection of the environment.


The move will help to deliver the government’s target of a third of contracts going to small and medium-sized businesses by 2022. 


Another intention is to identify modern slavery risks in the government supply chain and ensure government service procurement works towards its priorities of protecting the environment and guaranteeing that everyone has the opportunity to make the most of their talents.


Lidington’s speech, at an event held by Social Enterprise UK, outlined the new approach to an audience of leaders from business, education and the social sector.


“Every year, the government spends £49 billion with external organisations and it is morally right that we make sure none of that money goes to any organisations who profit from the evil practices of modern slavery,” the minister said.


“Similarly, it is right that we demand that the organisations we work with meet the high standards we need to protect our environment and employ workforces which represent our diverse society, including people with disabilities and those from ethnic minorities.


“By making sure that these social values are reflected not just across the government, but through all the companies we work with, we will take a major step towards our goal of creating an economy that works for everyone.” 


Government sees this new way of drawing up government contracts as one of the biggest changes in public procurement in recent years, adding to its commitment to bar suppliers who cannot demonstrate that they are paying their supply chains on time.


The move comes at a time in which the facilities services sector is involved in its own process to develop a measurement methodology that will allow social value components in FM contracts to be assessed against commonly accepted criteria. (See Facilitate, March 2019 and online.) The Crown Commercial Service has joined membership organisations, service providers and others working on the methdology, which is due to go live later this year.


Government says its approach will open up opportunities for social enterprises and other organisations where they are best placed to deliver social outcomes and promote good work by businesses.


The Cabinet Office also expects the move to create a ‘significant cultural shift’ for both the public sector and industry, but ‘without adding extra cost or complexity to the procurement process’.


Organisations that already put social values at the centre of their work have welcomed the move. On such, Future Biogas, operates in the anaerobic digestion industry. Managing director, Philipp Lukas, said: “We deliver social value in many ways, such as providing employment opportunities for skilled local young people in rural communities, generating green electricity and gas, enabling biodiversity in the rural environment, improving soil health and capturing carbon into the soils.


“The government’s commitment to ensuring social values are at the heart of its contracts will ensure that the contributions we make to society are recognised in full.”


Lord Victor Adebowale, chair of Social Enterprise UK, welcomed the opportunity for social enterprises to work more with government.


“People expect modern government and business to ensure that all spending considers the needs of our society and environment,” commented Adebowale. “Social enterprises have been pioneers, but it is important that every sector follows. This announcement will support the more than 100,000 social enterprises working in the UK. The social enterprise sector has been a great British business success story and it is right that the government does more to support it.”


A 12-week public consultation on the proposals will now be held with suppliers, public bodies and members of the public. 


 


A SOCIAL SHIFT IN EMPHASIS


Issues that will now be weighed when assessing government contract work include:

  •  Use of firms of all sizes, including those owned by under-represented groups.
  •  Assurance that the wider supply chain involved reduces risks from modern slavery or cybersecurity.
  •  The employment of people from all forms of diverse backgrounds
  •  Sufficient focus on environmental sustainability to reduce the impacts of climate change.
  •  The prioritising of staff training to boost employees’ long-term employability.

 


 Our March 2019 edition was themed to the growing momentum around social value. You can access this content at: tinyurl.com/FacMag0319-SocialValue

 


Emma Potter