Report urges beefing up of Social Value Act with adoption by councils mixed

The barriers to greater adoption of the Public Services (Social Value) Act by councils will only be overcome by legislative change to strengthen the legislation, Social Enterprise UK has claimed.

Responses to freedom of information requests submitted by the organisation revealed that one in three (33%) councils now routinely consider social value in their procurement and commissioning, and one in four (24%) councils have a social value policy.

In a report, Procuring for Good, Social Enterprise UK divided local authorities into four categories – 'embracers', 'adopters', 'compliers' and 'bystanders' – dependent on the existence of a social value policy, the scope of contracts to which they applied social value, and how social value was implemented.

The report suggested that just one in seven (14%) councils were fully embracing social value, applying it frequently to contracts including those below the threshold (of €209,000) for services – and the majority of these councils had a social value policy (58%).

A further one in five (19%) councils were seen as ‘adopters’ of the Act, applying it conservatively, but had a social value policy, framework or toolkit.

Social Enterprise UK said that almost half (45%) of the councils that responded ‘comply’ with the Social Value Act in that they mentioned social value in their procurement strategy but applied it infrequently.

A further one in five (22%) councils were ‘bystanders’ – “these operate without a social value policy and have little or no mention of social value in their procurement policy”.

The research also found that smaller district councils were less likely to consider social value than larger councils. A third (32%) of districts fell into the ‘bystander’ category, meaning they were making little or no use of the Act.

“Since many district councils are small and rarely tender for services above the Official Journal of the European Union (OJEU) threshold of €209,000, they have not integrated social value into their commissioning and procurement procedures. This is despite guidance from the Department for Communities and Local Government (DCLG) which encourages them to do so,” Social Enterprise UK said.

The report highlighted how there were two ways in which councils scored social value when putting contracts out to tender – some included social value clauses and terms; others included weighting for social value.

“The ‘complier’ councils (45% of those surveyed) give social value a 5% or less weighting; ‘adopters’ (19% of those surveyed) between 5-10% of the overall score; while ‘embracer’ councils (14% of those surveyed) score social value as high as 30%,” Social Enterprise UK said.

Peter Holbrook, its chief executive, said: “This research shows that where the will exists, councils in England are using the Act to embed social value into the way they commission services - in many cases going beyond its obligations to create positive change in their communities. This is a credit to the procurement and commissioning teams driving this agenda, they are unsung heroes.

“Sadly too few councils still see the Act as a duty rather than an opportunity. The Act has been in force for more than three years but is not empowering local authorities in the way it could be, to the detriment of our communities. Legislative change is needed - the Act lacks teeth and simply asking public sector bodies to consider the creation of social value when commissioning services is not enough.”

Chris White MP, who tabled the Public Services (Social Value) Act, said: “Thanks to this research, we have for the first time a clear picture of how embedded social value is within local government. Despite substantial progress, there is still a way to go before all councils are making full use of the changes to commissioning that the Act makes possible.”