The government has announced that organisations seeking to secure public sector work must set out how they will also deliver social value priorities. The new measure was announced on 24 September 2020, and comes into effect on 1 January 2021.
What does the new social value model entail?
Information from the latest procurement policy note advises that the social value model will assess contracts (or bidders) on the following:
- Supporting COVID-19 recovery, including helping local communities manage and recover from the impact of COVID
- Tackling economic inequality, including creating new businesses, jobs and skills, as well as increasing supply chain resilience
- Fighting climate change and reducing waste
- Driving equal opportunity, including reducing the disability employment gap and tackling workforce inequality, improving health and wellbeing and community integration
This supports recent government initiatives to develop the concept of social value in an aim to unite and ‘level up’ the country. From a bidder or supplier point of view, it focuses around not only on how you can deliver a contract, but how you can generate social value and added value directly from your undertakings. It is something that organisations must take seriously in order to secure government contracts.
On announcement of the new approach, Parliamentary Secretary at the Cabinet Office, Julia Lopez said:
‘Government has tremendous buying power, spending £49bn each year on contracts for vital public services. Value to the taxpayer should lie at the heart of our procurement decisions.’
Social value responses in tender submissions
If you currently tender for work within the public sector you will probably have encountered a number of quality questions surrounding the topic of social value and the Public Services (Social Value) Act 2012 in bid submissions.
In recent months it has been suggested that the weighting of social value in a tender response would increase, especially for central government procurement. The new model states that a ‘minimum weighting of 10% of the total score for social value should be applied in the procurement to ensure that it carries a heavy enough score to be a differentiating factor in bid evaluation’. All bidders will be tested, and bidders must demonstrate the full extent of the social value they will generate.
Teams who evaluate tender submissions, and commercial teams, will undertake training courses in the new model, and the Cabinet Office have also provided further aids and e-learning.
From a bidder’s point of view, this should provide further clarity and direction surrounding social value questions and scoring in this area. In our experience, the typical criticisms at the moment are to do with vagueness of the social value measures tenderers put forward, applicability and general understanding and guidance around the subject.
Support in social value
Executive Compass has had a strong interest in social value for many years now, with our team undertaking relevant training to support clients in considering their own social value offerings and drafting many social value tender responses.
As a result of this we have launched a sister company, The Social Value Practice, for dedicated support in this area. The Social Value Practice can provide training, policy guidance and consultancy to help you meet the new requirements and maintain your contract win rate.