Government response to the social value in procurement consultation
- Between March and June 2019, the government consulted on how social value should be taken into account in the award of central government contracts. The Public Services (Social Value) Act 2012 already places some requirements on relevant contracting authorities to take social value into consideration during procurement for services, but the consultation paper went further: it provided an evaluation model (at Annex A) and suggested that social impact also be considered as part of the award criteria.
- The government has now considered the consultation responses and published its own response, Social Value in Government Procurement: Consultation Response Paper (24 September 2020). The government confirms its commitment to "using its purchasing power to help communities and businesses recover from COVID-19". In addition, better account will be taken of the additional social benefits achievable in the delivery of its contracts, levelling the playing field for all types of businesses, including small and medium-sized enterprises (SMEs), voluntary and community sector organisations, and social enterprises (VCSE) as well as "encouraging employment opportunities, developing skills, tackling inequality and improving supply chain resilience". The government's findings include:
- the proposed metrics in the evaluation model were broadly supported and have been further developed, in particular, to reflect the government's priorities following the COVID-19 outbreak. Further guidance will be provided on the methodology's operation, each metric and on how to differentiate between inherent and added social value. Training on how to apply the methodology will be critical;
- the consultation's proposed minimum 10% weighting for evaluating social value in bids will be adopted with clarification to be issued through further guidance;
- the potential risk of creating barriers to engagement for SMEs and VCSEs was acknowledged. The government will encourage more diverse supply chains by providing training and guidance;
- good quality pre-procurement engagement and planning will lead to more effective alignment and delivery of policy priorities. This will be made clear in the guidance and training programme; and
- achieving the best commercial outcome will remain a key government objective but it is right to apply the government's commissioning power to supporting key social outcomes. "The public sector must maximise social value effectively and comprehensively through its procurement. It cannot afford not to; a missed opportunity to deliver social value is a cost that has to be absorbed elsewhere in public services." …"The new model will apply tests that all bidders, irrespective of their size and type, should be capable of meeting."
For details of PPN 06/20 published at the same time as the government response, see the commentary.