In the world of public procurement, success has traditionally been measured by two key factors: price and quality. For decades, suppliers have competed to offer the best possible service at the most competitive cost. But the landscape is changing. Today, a third, equally powerful element has entered the evaluation process: social value. The procurement process has evolved to include social value as a key criterion, ensuring that public sector procurement delivers broader benefits. The public procurement process now plays a crucial role in embedding social value, influencing how tenders are assessed and awarded to maximise social, economic, and environmental outcomes. For many small and medium-sized enterprises (SMEs), this term can feel vague or intimidating, but understanding its role is no longer optional—it’s a critical component of winning public sector contracts.
This guide is designed to demystify social value, breaking down exactly what it means for your business. We’ll explore the official policies that drive it, deconstruct the models used to measure it, and provide practical, real-world examples to help you craft a compelling social value offer. Public sector organisations are increasingly prioritising social value in their procurement activities, recognising its importance in achieving strategic and community goals. By the end, you’ll see that social value isn’t just a box-ticking exercise; it’s your opportunity to stand out, demonstrate a deeper alignment with public sector goals, and secure a powerful competitive edge.
Public sector contracts now require suppliers to consider not just price and quality, but also the wider impact of their work. Public sector procurement now requires a broader view, considering social, economic, and environmental factors to ensure value for money and compliance with legal frameworks.
What is Social Value? A Definition for Bidders
So, what is social value in the context of public procurement? In simple terms, it refers to the wider economic, social, and environmental benefits that a supplier brings to a community through a public contract, going far beyond the core goods or services being delivered. It’s the positive ripple effect your business creates. Public sector buyers are tasked with maximising the impact of every pound of taxpayer money, so they actively seek suppliers who can deliver this “added value” alongside fulfilling the primary requirements of the contract. Social value outcomes are the specific positive changes that public sector buyers seek to achieve through procurement, ensuring that contracts deliver tangible benefits beyond their immediate purpose.
Think of it this way: a construction company hired to build a new community centre delivers the building—that’s the core service. But if that same company also commits to hiring local apprentices, sourcing materials from nearby SMEs, and running safety workshops at a local school, they are delivering social value. These actions align with the social value objectives set by the buyer, ensuring that the contract supports broader policy goals. Similarly, an IT provider could fulfil its contract while also offering free digital literacy training for residents in a nearby housing association.
Crucially, this isn’t the same as corporate social responsibility (CSR) or general charitable donations. Social value commitments must be specific, measurable, and directly relevant to the contract being delivered. It stems from the principle that public spending should achieve “value for money” in its broadest sense, leaving a lasting positive legacy in the communities it serves. Delivering measurable benefits to the local community is essential for demonstrating the real impact of social value initiatives. For SMEs, this presents a unique opportunity to level the playing field, showcasing a deep-rooted community connection that larger, national corporations often can’t match.
To stand out in public sector procurement, bidders should develop a clear social value strategy to consistently address social value objectives and demonstrate meaningful social value outcomes in their bids.
The Driving Force: Understanding the UK’s Social Value Policy
The shift towards embedding social value in public procurement wasn’t accidental; it was a deliberate policy evolution. The landmark piece of legislation that kickstarted this change was the Public Services (Social Value) Act 2012. This Act requires public authorities to consider how the services they commission and procure might improve the economic, social, and environmental well-being of the local area.
Social value policy is now closely aligned with the government’s missions and the government’s strategic priorities, ensuring that public contracts deliver outcomes that support broader national objectives.
Initially, the Act only mandated that buyers consider social value. However, its influence has been progressively strengthened over the years. A key development was the introduction of Procurement Policy Note 06/20 (PPN 06/20) in 2020, which made it mandatory for central government departments to explicitly evaluate social value in their tenders, rather than just thinking about it. The National Procurement Policy Statement further guides contracting authorities in aligning public contracts with these strategic priorities and legal reforms.
This policy note introduced a new Social Value Model and, most importantly, mandated a minimum weighting of 10% for social value criteria in all central government contracts. This was a game-changer. Award criteria are now set to include social value objectives, directly influencing how tenders are evaluated and how contract award decisions are made. Suddenly, social value was no longer a ‘nice-to-have’ but a scored, contractual component that could make or break a bid. This standard has since been adopted by the NHS in England and embraced by countless local authorities, many of whom apply even higher weightings—sometimes as much as 30% of the total score. For bidders, the message is clear: a strong, well-evidenced social value offer is essential for success in today’s public procurement market.
For further guidance on implementing these policies and understanding evaluation and award criteria in public contracts, consult the latest government resources and documentation.
Deconstructing the Official Social Value Model
To ensure consistency, the government introduced a central Social Value Model. This framework provides public bodies with a clear structure for evaluating bids and gives suppliers a practical guide to what buyers are looking for. The model is built around five core themes, or policy outcomes, that reflect key government priorities:
- COVID-19 Recovery: Focused on helping communities recover from the pandemic’s impact, for instance, by supporting people who lost their jobs or addressing new health and social challenges.
- Tackling Economic Inequality: Creating new businesses, jobs, and skills to support economic growth, particularly in disadvantaged areas. This includes promoting supply chain resilience by using local SMEs.
- Fighting Climate Change: Delivering effective stewardship of the environment by contributing to net-zero targets, reducing waste, and promoting sustainable practices in the delivery of the contract.
- Equal Opportunity: Reducing the disability employment gap and tackling wider workforce inequality. This theme encourages suppliers to create fair and accessible opportunities for all.
- Wellbeing: Improving the health and wellbeing of individuals and communities. This can include initiatives that support mental health, community integration, and safe environments.
Key performance indicators are used to track progress on social value targets, ensuring that commitments are monitored and outcomes are achieved throughout the contract lifecycle.
When a central government body issues a tender, it will typically specify which of these themes are most relevant to the contract. Bidders are then asked to propose specific, measurable, and time-bound commitments that align with those chosen themes. Vague promises are no longer enough; buyers expect concrete plans that detail what you will do, who will benefit, and how you will track and report on your progress. Measuring social value is essential, and methods such as the Social Value Model and TOM System are used to measure social outcomes, often employing both quantitative and qualitative metrics.
Specific commitments are required, and the character limit in tender responses means suppliers must be concise and clear in describing how they will deliver and measure social value.
Find tender opportunities where your company’s social value can make all the difference. Explore live contracts with Supply2Gov Tenders.
For more details on the Social Value Model, evaluation frameworks, and associated guidance, refer to the official government resources.
Practical Examples of Social Value in Procurement
Understanding the theory is one thing, but seeing it in practice makes it tangible. These examples demonstrate practical ways to create social value in procurement. For an SME trying to figure out how to apply these principles, real-world examples are invaluable. Here’s how you might translate the themes of the Social Value Model into concrete actions within your bids.
Creating Economic Value: Local Jobs and Supply Chains
Public buyers are always keen to see their spending boost the local economy. This is an area where SMEs can truly excel. For example, a small engineering firm bidding on a local infrastructure project could pledge to hire two apprentices directly from a nearby college, providing them with certified training and a clear career path. This directly addresses skills gaps and local unemployment.
In scope organisations are required to report on local employment and supply chain outcomes.
Another powerful commitment is to dedicate a percentage of your contract spend to the local supply chain. You might commit that 30% of your subcontracting budget will be spent with other SMEs or social enterprises within a 20-mile radius. Framework agreements can be used to structure these commitments, setting out the terms and conditions for how local spend and subcontracting will be managed throughout the contract period. This keeps public money circulating within the community, fostering a resilient and diverse local economy. Other impactful examples include hosting career workshops for school leavers or offering work experience placements, all of which demonstrate a tangible investment in local economic growth.
When planning and delivering these initiatives, it is important to consider the commercial lifecycle and life cycle of the contract to ensure that benefits are sustained throughout all stages, from initial planning to contract management.
Delivering Social Benefits: Community and Wellbeing
This category is about making a positive, direct impact on people’s lives. A highly effective approach is to partner with existing community organisations. For instance, a catering company could commit a certain number of staff volunteer days per month to a local food bank, helping sort donations or deliver meals. This leverages your existing resources to amplify the work of established charities.
Supporting social inclusion is another key area. A marketing agency could offer pro-bono mentoring sessions to a local start-up social enterprise, helping them develop their brand and reach. These social value commitments should be tracked, reported, and evaluated during contract management and throughout the contract management phases to ensure objectives are met and documented. A facilities management company could commit to a recruitment strategy that specifically targets disadvantaged groups, such as the long-term unemployed or ex-offenders, thereby promoting equal opportunity. It is essential to ensure equal treatment in all hiring and inclusion practices, so that all candidates are assessed fairly and without discrimination. Don’t forget internal initiatives either; implementing a comprehensive mental health support program for your own employees is a valid contribution to workforce wellbeing that buyers value.
It is important to note that equality duties apply regardless of financial threshold, and social value commitments are considered both at contract award and throughout contract delivery.
Promoting Environmental Sustainability
With the UK’s commitment to achieving Net Zero, environmental sustainability has become a top priority in public procurement. Even small businesses can make a significant impact. A local courier service, for example, could commit to using electric vehicles for all deliveries related to the contract, measurably reducing carbon emissions.
Setting specific, green targets is crucial. Instead of a vague promise to “be more green,” you could pledge to “reduce waste to landfill by 75% over the contract’s lifetime by implementing a new recycling and composting programme.” Other examples include adopting a zero-waste-to-landfill policy for your operations, using only biodegradable cleaning products, or sourcing a percentage of your materials from certified sustainable or recycled sources. The key is to make your commitments measurable—for example, by pledging a specific carbon reduction target in tonnes and explaining exactly how you will track and report it.
A Procurement Guide: How to Demonstrate Social Value in Your Bids
Knowing what social value initiatives to offer is only half the battle; presenting them effectively in your tender response is what wins you the marks. This section acts as a procurement guide for the social value element, providing actionable advice to turn your good intentions into a high-scoring bid. Each procurement activity and step in the procurement processes should be aligned with social value objectives to ensure compliance and maximise impact.
- Be Specific and Measurable: Avoid vague platitudes like “we are committed to our community.” Instead, frame your offers as SMART targets (Specific, Measurable, Achievable, Relevant, Time-bound). Don’t just say you’ll hire locally; state that “we will create two new full-time roles for residents from the XYZ postcode within the first six months of the contract.” This clarity gives the evaluator confidence that you have a credible plan.
- Align with the Buyer’s Priorities: Research is vital. Read the tender documents carefully to identify the specific social value themes the buyer cares about. Go further by reviewing the contracting authority’s website for their corporate strategy or social value policy. Contracting authorities play a key role in setting social value targets for public contracts, ensuring that these objectives are embedded in the procurement process. If a council’s strategic plan highlights tackling youth unemployment, tailor your offer to focus on apprenticeships and work experience for young people. A generic, copied-and-pasted response will score poorly.
- Provide Evidence and Credibility: How can you prove you’ll deliver on your promises? Reference past achievements. If you’ve successfully run a similar initiative before, describe the outcomes. For example, “On a previous contract, we mentored three local college students, one of whom has now joined us as a full-time employee.” If you’re new to this, demonstrate your preparedness by mentioning relevant policies, partnerships with local charities, or staff training you have in place. Use key performance indicators to track progress against your social value targets and demonstrate better outcomes for the community and stakeholders.
- Don’t Overpromise (Be Authentic): It can be tempting to make grand promises to win a bid, but remember that your social value commitments will become legally binding contractual obligations. It is far better to propose a modest, credible initiative that you can deliver flawlessly than to overpromise and fail. Authenticity is key. A social value offer that naturally aligns with your business—like a graphic design firm offering free branding workshops to charities—feels more genuine and credible than a disconnected pledge.
When submitting bids for public contracts, use the central digital platform to ensure your procurement activity is visible and compliant with current regulations. Securing support from leadership and key stakeholders is essential to deliver on your social value commitments and achieve the best possible results.
Our platform is the perfect guide to public procurement opportunities. Let Supply2Gov Tenders help you find your next contract.
Why Authentic Social Value is Your Competitive Edge
In a crowded tender process where bidders are often closely matched on price and technical ability, a strong and authentic social value offer can be the decisive factor. It acts as the ultimate tie-breaker. When an evaluator is faced with two otherwise equal bids, the one that promises greater community benefit will almost always pull ahead. This is particularly true now that scoring for social value is a formal, mandatory requirement. Authentic social value offers also demonstrate responsible stewardship of public funds, ensuring that government spending delivers transparent, efficient outcomes aligned with strategic policy objectives.
For SMEs, this is a “great leveller.” A large corporation might have the resources to offer a lower price, but an SME often has deeper local roots and greater agility. You are better positioned to understand the specific needs of the community and propose tailored, meaningful initiatives that a national firm might overlook. Evaluators recognise this. They know that a small business committing to one or two high-impact local projects can deliver more genuine value than a corporate giant with a generic, nationwide programme.
A compelling social value proposal also builds an emotional connection. It shows the evaluator that you share the public sector’s values and are committed to being a true partner, not just a transactional vendor. This builds trust and can positively influence how your entire bid is perceived. Under the Procurement Act 2023, contracts are awarded based on the “Most Advantageous Tender,” which considers overall benefit, not just the lowest cost. A bid that combines excellent service with genuine social impact is, by definition, the most advantageous.
Integrating Social Value into Your Business Strategy
To consistently win tenders on the strength of your social value, it’s best to embed it into your company’s DNA rather than treating it as a last-minute addition to a bid. When social value becomes a core part of your business strategy, writing compelling tender responses becomes infinitely easier, because you’ll have a library of real examples, data, and success stories at your fingertips.
Start by making it a company-wide priority. Ensure your team understands why it matters and encourage them to contribute ideas for community engagement or environmental improvements. You could formalise this by allocating paid volunteer days, establishing an official apprenticeship scheme, or creating an environmental policy with clear targets. These initiatives are not just costs; they are investments in your company’s long-term success in the public sector market.
It’s also crucial to track and measure your activities. If you run a volunteering scheme, keep a record of the hours contributed and gather feedback from the partner charity. If you’re reducing your carbon footprint, track the energy saved. This data provides the hard evidence you need to back up your claims in future bids. Measuring social value is essential—use frameworks like the Social Value Model or TOM System to measure social outcomes, quantify impact, and demonstrate results using both qualitative and monetary metrics.
When keeping records and gathering feedback, make sure to document your social value deliverables for contract management purposes. This will help you monitor performance against key performance indicators (KPIs) throughout the contract lifecycle and provide robust evidence for future bids.
By baking social value into your daily operations and business development process, you’ll always be one step ahead, ready to translate your positive impact into a winning proposal. Developing a clear social value strategy will further strengthen your approach, ensuring ongoing improvement and long-term success.
Your Next Steps to Winning with Social Value
Social value is no longer a fringe concept in public procurement; it is a central pillar of the evaluation process and its importance is only set to grow. For SMEs, this represents a golden opportunity. By putting genuine thought and effort into your social value offer, you can compete with and win against larger rivals on the strength of your community impact.
To succeed, focus on the fundamentals: understand the official Social Value Model, be proactive in developing your initiatives, and always tailor your bid to the buyer’s specific priorities. Above all, be authentic. Choose activities that align with your company’s skills and values, and then measure and document your impact to build a powerful evidence base.
Finding the right opportunities is the final piece of the puzzle. You need to identify contracts where your unique social value strengths will be most appreciated. Supply2Gov Tenders is the indispensable tool for this, providing tailored alerts that help you focus on the tenders where you can truly make a difference. By embracing social value as a core business principle, you’ll not only strengthen your bids—you’ll build a more resilient business and a better community.