One in three councils consider social value in procurement, finds study

A third of councils now consider social value when commissioning but more legislative change is needed to strengthen the Social Value Act, according to research.

A report by Social Enterprise UK (SEUK) said that one in three councils in England routinely considers social value in their procurement and commissioning, with one in four having a social value policy.

Social value was embraced by every tier of local government and from across political divides, but smaller district councils were less likely to consider social value than larger councils, the study found.

The Procuring for Good report added that despite progress, asking public sector bodies to consider social value when commissioning services was not enough. Legislative change was needed to strengthen the Act, SEUK said.

The study used the findings from Freedom of Information requests sent to all local authorities in England to get at picture of how they are using the Public Services (Social Value) Act.

The report puts local authorities into four categories: embracers, adopters, compliers and bystanders, based on the existence of a social value policy, the scope of contracts to which they apply social value, and how social value is implemented.

According to the study, one in seven councils are fully embracing social value, applying it frequently to contracts, and most have a social value policy (58%).

One in five councils are classed as “adopters” of the Act, applying it conservatively, but they have a social value policy, framework or toolkit.

Almost half (45%) of the councils that responded “comply” with the Act, mentioning social value in their procurement strategy but applying it infrequently, while 1 in 5 (22%) councils are “bystanders”, operating without a social value policy and with little or no mention of social value in their procurement policy.

At a district council level, a third are categorised as bystander. SEUK said that as many district councils were small and rarely tendered for services above the Official Journal of the European Union threshold of €209,000 (£159,000), they had not integrated social value into their commissioning and procurement procedures.

It noted that this was despite guidance from the Department for Communities and Local Government encouraging them to do so.

The study concluded that medium and larger sized local authorities, which tender for services much more frequently, were significantly more likely to have, and use, a social value policy.

The report also outlined how councils scored social value when putting contracts out to tender, with some including social value clauses and terms, and others including weighting for social value.

The “complier” councils (45%) gave social value a 5% or less weighting, adopters (19%) between 5-10% of the overall score, while embracer councils (14%) scored social value as high as 30%.

Peter Holbrook, CEO at SEUK, said many councils were “unsung heroes”, going beyond the Act’s obligations to creative positive change in their communities, but he said more needed to be done.

“Sadly too many councils still see the Act as a duty rather than an opportunity,” he said. “The Act has been in force for more than three years but is not empowering local authorities in the way it could be, to the detriment of our communities. Legislative change is needed. The Act lacks teeth and simply asking public sector bodies to consider the creation of social value when commissioning services is not enough.”

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