Minister unveils details of ‘social value’ measures for government procurements

Central government procurements will be required by summer 2019 to take social and economic benefits into account in certain priority areas, Cabinet Office Minister David Lidington has announced.

These priorities are to include:

  • helping access for small businesses
  • helping access for businesses owned by under-represented groups
  • increased representation of disabled people in the workforce
  • reduced environmental impact

In a speech to the Business Services Association, the minister also said that a proposed ‘playbook’ would apply to all government outsourcing, with a particular focus on complex and first generation projects.

“This will include a new presumption in favour of running a pilot where government is outsourcing a service for the first time to understand risks and implementation challenges and a new requirement for government to produce an assessment of how much a service ‘should cost’ to deliver when deciding whether to utilise the private sector,” he said.

This playbook, which is being developed together with the industry, will be launched early next year. It will link to the Treasury’s ‘Managing Public Money’ guidance which will be used alongside new Financial Distress Guidance that explains how to assess the financial health of firms and details the steps to take in the event of company failure, Lidington said.

Key government suppliers have been drawing up plans, so-called ‘living wills’, in the event of business failure where another company may need to step in, the minister added.

Capita, Serco and Sopra Steria had volunteered for this initiative and their ‘living wills’ will be ready within weeks, he revealed. Other key suppliers are set to follow.

Further measures announced by the minister include:

  • central government shortly publishing new data, “not seen before”, about the performance of critical contracts, such as response rates and if they are delivering on time
  • the government’s Supplier Code of Conduct being reviewed and enhanced
  • the GovTech catalyst programme being scaled up to ensure the best ideas and technologies are assessed quickly - with plans to be published in Spring 2019

David Lidington said: “We are determined to build a society where people from all parts of our country have access to the best public services.

“Public services should be delivered with values at their heart… it is right that we use government’s purchasing power to benefit society.”

On the creation of ‘living wills’ for key suppliers, he said: “Carillion was a complex business and when it failed it was left to government to step in - and it did. But we did not have the benefit of key organisational information that could have smoothed the management of the liquidation.

“By ensuring contingency plans can be quickly put in place in the very rare event of supplier failure, we will be better prepared to maintain continuity of critical public services.”