Social Value Act

[edit] Where is Social Value in Law?

The Public Services (Social Value) Act 2012 became law in the spring of 2012 and came into came into force on 31 January 2013. It was the result of a private members bill, the aim of which was to '…strengthen the social enterprise business sector and make the concept of 'social value' more relevant and important in the placement and provision of public services'. The government published guidance in December 2012 supporting the Act which can be found here.

Social value in this context is defined as consideration to how the proposed procurement might improve the economic, social and environmental well-being of a relevant area.

[edit] How has the Social Value Act been reformed?

In June 2018 the government announced that it would go further and explicitly evaluate social value when awarding most major contracts.

In March 2019 the government launched a consultation on reforms to the Act. The consultation closed in 10 June 2019. Ref https://www.gov.uk/government/consultations/social-value-in-government-procurement

In April 2020, UKGBC published Delivering Social Value: Measurement. A guide to measuring the social value of buildings and places.

In September 2020, the government published Procurement Policy Note – Taking Account of Social Value in the Award of Central Government Contracts setting out a new model to deliver social value through government's commercial activities.

[edit] What is the Social Value Model ?

To help departments implement changes and following a public consultation, the Cabinet Office and DCMS worked with departmental commercial, policy teams and supplier representative bodies to develop a Social Value Model.

The Social Value Model provides a consistent approach for departments and suppliers, and helps streamline and standardise the procurement process. It has been designed to fit easily into existing processes, minimising the impact for commercial teams and suppliers and provides a clear, systematic way to evaluate policies in the award of a contract.

Social value is evaluated based on qualitative responses from bidders, and not on volumes. This means that larger suppliers are not able to win on scale alone; all bidders must set out what they will deliver and how they will deliver it and it is this information that will be scored in bid evaluations. The minimum weighting that should be applied to social value is 10%.

The Cabinet Office has created guidance on how to use the Social Value Model here that must be applied to all new procurement activity from January 1st 2021.

[edit] Where is Social Value applicable?

Government departments are expected to report on the social impact of their major contracts. Major contracts are defined in Procurement Policy Note – New Thresholds 2020" Information Note PPN 06/19 November 2019.

This applies to all public services contracts (or framework agreements), and also to those public services contracts which include the purchase or hire of goods or the carrying out of works. NB There is general government support for public bodies considering social value in the award of all contracts, whether they fall within the requirements of the Act or not.

The Act applies in England and Wales, although it excludes some devolved functions in Wales. The requirements of the Act may be disregarded under certain circumstances where there is an urgent need to procure '... to the extent that it is not practical to comply with them'.

[edit] How is community valued ?

The Act requires that procuring authorities get best value from public spending by ensuring that services are procured in a way that benefits the community. Examples of social values that could be a part of a contract might include a commitment by a tenderer to employ the long-term unemployed or people with disabilities, or using local groups to provide services where the income generated by the group is likely to stay in the local community.

[edit] What must an authority consider?

The procuring authority must consider:

• How what is proposed to be procured might improve the economic, social and environmental well-being of the relevant area.
• How, in conducting the process of procurement, it might act with a view to securing that improvement

The Act includes the provisos that:

• The authority considers only matters that are relevant to what is being procured.
• The consideration of matters must be proportionate.
• The principles of value for money and equal access are preserved.

[edit] What does this include ?

The process of taking social values into consideration might include:

• The procuring authority developing a general social values policy.
• When procuring specific contracts, identifying relevant, non-discriminatory matters of social value that are proportionate and appropriate.
• Preparing verifiable, testable, weighted selection criteria along with any special conditions that might be included in contract terms.
• Including social value criteria contract notices and tender documents.
• Requiring tenderers to demonstrate how social value will be created and delivered.
• Monitoring the delivery of social values.

[edit] Related articles on Designing Buildings

• Building social value.
• Construction contract.
• Corporate social responsibility in construction.
• Creating social value from civil engineering projects.
• Framework agreements.
• OJEU.
• One Public Estate OPE.
• Procurement route.
• Prosperity.
• Public contract.
• Public contracting authority.
• Public procurement.
• Social benefits.
• Social cost.
• Social sustainability.
• Social time preference rate.
• Social infrastructure.
• Social value: Gearing up for giving back.
• Social value and design of the built environment.
• Social value in new development.
• Social value overview.
• Sustainable procurement.
• Tender.
• Tender documentation.

[edit] External references

• See the act in full.
• Explanatory notes to the Act.
• Social Enterprise UK: Public Services (social value act 2012) A brief guide.
• National Association for Voluntary and Community Action: Social Value Act.

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