Delivering social value requires involvement of the whole supply chain — it is our collective responsibility
If your firm works on public-sector projects, you are probably aware the government recently announced a new social value policy framework which stipulates that the public sector must procure social value from each contract. This is a fundamental shift from the current legislation, and something we all need to understand.
The question I hear most from the companies we work with is: “How do we implement social value and ensure it happens throughout our projects?”.
It seems the government may not understand that planning is utterly at the behest of local politics
The first thing to remember is that social value targets need to be realistic, as well as bespoke to local communities, so that they maximise social, economic and environmental outcomes in a local area. For example: is there a need for local jobs and apprenticeships? What is the availability of local supply chains to deliver any specialist works? Will off-site manufacturing be used for construction delivery?
The second thing is to look at social value throughout the project lifecycle. This helps us to create clearer roadmaps for implementing and measuring social value.
Before the new legislation came into force, most projects addressed social value at the construction phase (the RIBA plan of work stage 5) only, placing the onus on construction companies to deliver social value from RIBA stage 0 through to stage 7, recognising that opportunities lie at each stage of the project. The problem with focusing on a single stage is that if a local supply chain, or opportunities, don’t exist for that element of the work, you lose huge potential for social value.
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A good example of this is a recent project to develop a leisure centre in the North-west, where the client’s aspiration was to retain the majority of the project spend in the local area on local suppliers, as well as creating local employment and apprenticeships. However, at the RIBA plan of work stage 0-1, a scoping exercise of the local supply chain revealed there wasn’t actually sufficient capacity locally to deliver the project. Rather than dropping their aspirations for the project overall, the client shifted their focus to RIBA plan of work stage 2-4, where it identified alternative ways of delivering social value: upskilling residents, delivering work placements and traineeships for disadvantaged residents, using local suppliers for materials, and supporting local voluntary and community groups.
Starting the social value process at the RIBA stage 0, as this client did, means we can get a better understanding of how, and indeed if, the project can be delivered locally, and if it can’t, what alternative methods of social value we can bring in.
This enables us to set realistic targets which are then carried through into procurement documents, ensuring suppliers fully grasp what is required. With targets set at the outset, we can monitor social value at the design and construction stages, collecting real-time data that shows if we’re hitting our social value targets. This data could include the actual number of construction jobs, apprectices and local spend created from the project or the amount of voluntary time the project team has given to community groups. The most important thing is that by reviewing the data regularly we can quickly identify any shortfalls in social value and adjust our activity accordingly.
The earlier you embed social value, the greater your returns will be. For example, integrating social value at stage 0 will give you an estimated 10-20% social value net gain than it would if you were embedding social value at stage 5.
So when clients ask me how to implement it I say to start at the beginning. There is no standard approach you can take. Social value must be rooted in the local area, with a deep understanding of local needs, skills and capacity. Delivering it requires involvement of the whole supply chain — from the developers through to the consultants, construction companies and facilities management services.
It is our collective responsibility.
Mark Bolger is chief executive of Social Profit Calculator