Putting social value at the heart of procurement

The Social Value Act places a duty on contracting authorities such as schools and academies to consider how to improve the social, economic and/or environmental wellbeing on the community when procuring service contracts that exceed the procurement regulations threshold. CPL Group provides practical tips to get your institution started with social value

Step 1 – Identify the social values of your institution

Social value is built into many educational institution’s mission statements or in policies and procedures such as environmental policies. Some institutions have key stakeholders such as community engagement officers who are a great source of knowledge on the key social value agendas in institution’s local communities, schools and charities. Your local authority is also a key stakeholder who will have a stake in social value agendas in your region.

Step 2 – Translate these values into verifiable requirements

Consider if it is possible to translate your social values into verifiable requirements in your tender specification. Consult with both the supply market, your institution’s key stakeholders and your local community prior to starting a procurement procedure.
 
It is important that any social value requirements are relevant to the contract subject-matter (do not impose unnecessary burdens that will deter suppliers from bidding or that will have serious negative impacts on costs or disadvantage non-local bidders). Engage with the market before the procurement commences about your social value objectives as it will help identify and mitigate risks. You can set out specific social, economic or environmental requirements that you want delivered or you can define your service using desired outcomes.
    
Some examples of requirements that you could adapt and use in your own service design specifications are as follows.
    
Regarding community, you could specify in your outsourced catering contract tender that a supplier is to engage with a local foodbank to ascertain what produce left over from the delivery of the contract could be donated from your institution to a local foodbank.
    
For skills, training and recruitment, you could require that when a contract involves a supplier’s employees working onsite at your institution, the supplier is to provide additional social value through its recruitment to positions associated with the service. This leaves it open to the bidder to identify how they can add value to the community. Should you be situated in an area with a large armed forces presence you could require the supplier to employ a diverse workforce including the employment of veterans and service spouses, see www.armedforcescovenant.gov.uk.
    
An alternative approach is to require the supplier to generate employment and training opportunities for targeted groups you may have identified through work with your local authority through the delivery of this contract.
Regarding the supply chain,  should you have any contracts that involve sub-contracting by the main contractor, such as a works contract for buildings, you could encourage suppliers to publish supply chain opportunities associated with the contract on Contracts Finder to remove or reduce participation barriers for VCSEs and SMEs.
    
Regarding environmental management, you could require the supplier to work with you to identify opportunities to introduce innovation, reduce cost, reduce waste and ensure sustainable development is at the heart of their operation. Working with third sector organisations is a good way to identify these opportunities.

Step 3 – Choose your route to market to maximise social value

Evaluate your procurement options and whether this can have a positive impact on your institution’s social value objectives before starting a procurement. An example of this would be if one of your institution’s social objectives is to reduce its impact on the environment in terms of carbon reduction and greenhouse gas emissions.     
    
You could look at the way you procure goods that are delivered regularly to your premises such as paper, stationery, janitorial goods, PPE and teaching supplies. After reviewing this you could consider ways to reduce delivery frequency such as procuring goods collaboratively with other local organisations and appointing a single supplier with co-ordinated delivery schedules.
    
It is advisable to consider if there is an existing framework agreement in place you could call off from. Many frameworks will have already considered social value in relation to the subject matter of the specification. It could also provide you with an additional opportunity to determine if you want to know more from bidders at the call off stage. Most suppliers have social value offerings, you now need to encourage them to tailor this for the benefit of your community.

Step 4 – Evaluation of a supplier’s ability to meet your social value objectives

It is mandatory to use the Cabinet Office Standard Selection Questionnaire which includes an evaluation of a bidder’s social value obligations in terms of breaches of relevant legislation when conducting procurements above The Public Contracts Regulation threshold. You could consider setting similar minimum standards in lower value procurements which need to be achieved before evaluating a bidder’s tender.
    
You can include social considerations when deciding on your award criteria to determine which bidder will win the tender. The procurement regulations explicitly allow social considerations to be included in award criteria provided they meet certain principles that all criteria must adhere to:  best price-quality ratio, being related to the contract’s subject matter and conforming to the principles of procurement; proportionality, non-discrimination and transparency.

Step 5 - Ensure the social benefits are fulfilled through contractual performance

Contract performance clauses set out how the contract should be performed. It is possible to include social, employment-related and/or environmental conditions where appropriate, providing they are linked to the subject-matter of the contract and had been previously indicated in the procurement documents.
    
These obligations must be accepted by the successful tenderer and relate to the performance of the contract. They should not play a role in determining which tenderer gets the contract (provided the successful supplier has met the conditions).
    
Contract performance clauses are generally the most appropriate stage of the procedure to include social considerations relating to employment and labour conditions of the workers involved in the performance of the contract. They may be intended to favour on-site vocational training, the employment of people experiencing particular difficulty in achieving integration, the fight against unemployment, to recruit long-term jobseekers or to implement training measures for the unemployed or young persons.
It is important to verify that contractors are complying with any social obligations and legislation through effective contract management procedures.  

Conclusion

We trust this article has given you some food for thought in terms of how you might be able to embed social value in your procurements and not just for high value service contracts where the Social Value Act requires you to consider what could be achieved.

CPL Group

Crescent Purchasing Consortium and Tenet Education Services are not-for-profit organisations which are part of CPL Group, an education owned charity that gives back to the sector through funding and support. CPC provides frameworks designed for education covering a variety of products and services with many recommended by the DfE. CPC membership is free of charge to all education institutions. Tenet provides procurement consultancy support.