A procurement policy note that came into force last month is helpful but it should go further, says F&G’s Peter Masonbrook
With each new year comes change, and 2021 is no different. From the first of the year, Procurement Policy Note 06/20: taking account of social value in the award of central government contracts, came into effect.
Social value is not a new concept. From 2013, when the Social Value Act first came into force, all public sector commissioners were required to consider how they could improve the economic, environmental and social wellbeing of their population through their procurement activities.
The key word here is ‘considered’. This year’s legislation makes one very big distinction – the inclusion of social value in central government procurement is now mandatory.
While not all change is good change, this is a nice exception. We have long been talking about the need for the built environment to move away from lowest cost and to a more well-rounded view of what ‘added value’ means.
Suppliers can commit to big social value promises in their tenders, without being held accountable later down the line
PPN 06/20 forces us all to think about the real impact of what we do and how we can work to increase that social impact for the good of everyone. It also opens the doors wider for opportunities for SMEs and voluntary community and social enterprises as a more qualitive evaluation process for procurement means the most impactful solution will be taken forward, regardless of where it comes from.
But the publication of PPN 06/20 in and of itself is not enough to enact the change we need. In fact, in some ways, I would say the procurement notice does not go far enough.
For one, it only mandates social value in the procurement process and not in the actual delivery of the project. This means that suppliers can commit to big social value promises in their tenders, without being held accountable to delivering those promises later down the line. What we need to ensure is the tracking and measurement of social value impact throughout the lifecycle of the project.
It may also inadvertently give large organisations a leg up in winning work as they have vast experience in responding to central government bids and will be able to make larger commitments to social value than say a SME (particularly if they know they may not be held accountable).
PPN 06/20 also only mandates social value for central government bodies; in some ways, this is an easier, shorter-term fix than amending the Social Value Act, which would affect the whole of the UK public sector. If we want true change, social value should be mandated on all public sector projects.
The inclusion of this statement is also worrying: “Unnecessary burdens should not be placed on commercial teams or suppliers” as it could suggest a ‘get out’ clause for some projects. I also feel the mandates weighting score of 10 or less for social value could have been pushed higher. At Faithful+Gould, we have already seen projects weighting it at 17% to 30%, so know it can play a bigger role with a higher positive social value impact.
Finally, training is still needed. Until training has happened, social value will be poorly administered and have little real impact on project delivery. Without awareness and understanding at every level, we will not see social value’s true potential.
With PPN 06/20 in place, it is now up to us to ensure social value is embedded, and more importantly, actually delivered. I say ‘us’ in the broadest sense as for social value to work it must be promulgated through every element of the client’s organisation and the supply chain. The big issues that are fundamentally changing the world around us – Brexit, Covid-19, the UN Sustainable Development Goals, our commitment to Net Zero – are all key drivers for social value. We can’t leave it to a government mandate to make it happen; we need to take change into our own hands.
Peter Masonbrook is associate director and social value lead at Faithful+Gould