Social value in the public sector

Social value in the public sector
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Adam Crampsie, Managing Director, Bloom Procurement Services, directs our attention to social value in the public sector

As the country builds back from the COVID-19 pandemic, there is increasing pressure on the public sector to better manage their social value efforts and deliver positive outcomes to the people, communities and economies that need it the most.

Social value has climbed up the agenda for public sector organisations in recent years. What was once a tick-box exercise is now considered a commercial imperative. A key driver for this shift was the introduction of the Social Value Act 2012, which urges public bodies to consider how procured services can improve the economic, social and environmental wellbeing of the area that falls within their remit. The Act underpins the government’s commitment to social value, as opposed to pricing when procuring services.

While the Act has been successful in its mission to place more focus on the social and economic benefits of how the public sector spends money, there are still many barriers to making this happen in practice. As the nation moves through the recovery phase of the pandemic, how can public sector bodies ensure they are creating a sustainable local supply chain to deliver their services while stimulating much-needed local economic growth?

Progressive procurement & economic challenges

The answer lies in progressive procurement. Progressive procurement strategies enable organisations to utilise local suppliers and ensure that public wealth is reinvested back into the local community. By investing in local suppliers, public sector bodies have an opportunity to spend public money in a smarter way. A way that maximises the reach of every single pound spent and delivers more value for the public purse, whether it’s by supporting small businesses, creating employment opportunities, promoting social integration or delivering better access to training and education. All of this results in a thriving local economy that can clearly demonstrate sustainable growth.

But the social and economic challenges of COVID-19 have only made the need for such outcomes more pertinent. In today’s climate, every single pound spent by the public sector will have a direct impact on the livelihoods of people within local communities. With employment rates at a low and the economy slipping into the deepest slump since quarterly records began, progressive procurement practices must now be scaled-up.

The economic fallout from the crisis has led to the government taking significant steps to deliver economic support through increased public spending. The Cabinet Office has unveiled a Procurement Policy Note (06/20), introducing measures that place social value at the centre of all future central government procurement activity. As of 1st January 2021, all central government buyers must go above and beyond the guidelines set out by the Social Value Act 2012, ensuring that all major procurements explicitly evaluate social value, rather than just consider it.

The ‘Build Back Better’ initiative has also put a heavy focus on social value as we recover from the pandemic, aiming to redirect public spend to ensure that vital public services are properly resourced and to create secure, well-paid jobs for all who want them, particularly young people.

However, there are several core barriers that face public sector bodies in the achievement of local economic benefit through progressive procurement. One of these barriers is the dependency on SMEs and VCSEs to meet the relevant eligibility criteria and have both the capacity and expertise to compete with larger providers in the procurement process. SMEs and VCSEs also often cite a lack of awareness and poor promotion of contract opportunities as a barrier, as well as a tendency for authorities to ‘stick with what they know’ by using larger national suppliers.

Furthermore, a survey by the Federation of Small Businesses (FSB) found that the time and cost involved with the public sector tendering process remains a major barrier to participation, as does the difficulty in finding and accessing public sector contracts.

Delivering assurance for public sector buyers

At Bloom, we deliver a comprehensive solution to these challenges through our fully compliant open-access marketplace. With social value deeply embedded in our DNA, we have a proven track record in empowering the public sector to deliver on their social value goals, build a sustainable supply chain and deliver real, measurable impact to local economies. Our recently published annual Social Value Report revealed that Bloom successfully embedded over £28.2 million in social value activity within just 12 months.

We provide an OJEU-compliant managed procurement service, covering specification development, supplier identification and onboarding, full contract management and lessons learned upon successful delivery of outcomes. This is delivered through the innovative NEPRO³ framework, the new and improved solution for the procurement of professional services. The solution allows buyers to move quickly and at the lowest possible cost, saving public sector buyers on average between 11% and 19% against budget.

The only solution of its kind within the UK public sector marketplace, NEPRO³ places a greater focus on creating a public sector buyer and supplier community, removing barriers to entry for local suppliers.​ Each supplier onboarded goes through a robust and detailed accreditation process to verify their capability to deliver in the chosen category, giving public sector buyers the cast-iron assurance that’s at the heart of our service. To date, 88.9% of our accredited suppliers are of SME status (with 9.19% of VCSE status), enabling public sector buyers to drive significant growth back into the local economies that need it most.

Buyers can also select local suppliers to bid on contracts for large projects that exceed OJEU limits, ensuring the local economy benefits from the authority’s spend. Such contracts would typically go out to tender at a national level, where competition from national supply chains often excludes local SMEs and VCSEs.

 A step in the right direction

The COVID-19 pandemic has undoubtedly presented an opportunity to shift mindsets around progressive procurement and put a much-needed emphasis on the importance of social value and local economies. But by adopting progressive procurement strategies, public sector buyers can use their procurement spend to create a sustainable supply chain, reinvest back into local economies and, ultimately, change lives for the better.

 

Please note: This is a commercial profile

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Managing Director
Bloom Procurement Services
Phone: +44 (0)20 3948 9400
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