Social value was a major talking point at this year’s Procurex England North event. It is becoming more and more important for the public sector to get maximum value out of every pound and penny that it spends.
The Social Value Act was introduced to cause public sector commissioners to think about how to secure wider social, economic and environmental value for their area or stakeholders when undertaking procurement. It has encouraged public sector buyers across the country talk to their local provider market or community to design better services. This communication with suppliers has helped the public sector to find new and innovative solutions.
Find out more about social value below.
What does Social Value mean?
The Sustainable Procurement Task Force definition of social value is:
‘A process whereby organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organisation, but also to society and the economy, whilst minimising damage to the environment.’
The Public Services (Social Value) Act
When the Public Services (Social Value) Act came into force on 31 January 2013 it changed the way in which public sector buyers commission public services to think about how they can also secure wider social, economic and environmental benefits through procurement.
The purpose of social value does not revolve around how much money is saved but about what other benefits the contract can provide.
Former MP Chris White, who introduced the Social Value Act, explains its purpose below:
“We mean ‘value’ not in its narrow [financial] sense but in its true sense – recognising the importance of social, environmental and economic well-being across our communities and in our lives.”
Social value is now considered before procurement processes have even begun. Public sector buyers must think about whether the services/products they are going to buy and how they are going to buy them could benefits their area and the stakeholders within it.
Providing Effective Social Value
Social value is specific and for it to be effective it must align with the specific needs of the local community.
Defining what social value means to the local community is important and there is a simple way your organisation can do this. You can establish social value requirements by looking at the priorities listed in a local authority’s Local Area Plan or Sustainable Community Strategy.
Communication is also key. If your business wants to win public sector contracts and provide social value to a buyer’s local community then you must consult with residents, MPs and local government representatives, social enterprises and other small business owners.
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