Embedding social value in public procurement

A Social Value Act for Northern Ireland will bring social, economic and environmental benefits.

Plans for Northern Ireland’s very own social value legislation were put on hold following the collapse of the Assembly in January. 

Similar to legislation in England and Wales, a Social Value Act would require commissioners of public services to consider how they can secure wider social, economic and environmental, or sustainability, benefits. 

While social clauses are nothing new locally, they have mainly operated within the construction sector for large-scale projects by way of the Strategic Investment Board’s Buy Social programme. This typically involves placements and apprenticeships as part of construction contracts.

However, concerns exists as to whether or not those opportunities provide lasting benefits for certain target groups, such as vulnerable adults, the long-term unemployed and, perhaps more challengingly, those who are known to be economically inactive. The construction sector has, of course, seen a significant downturn in recent years and it is arguable that firms may not view social clauses as entirely beneficial in such circumstances. 

Government could, instead, gear placements towards sectors with greater employment opportunities. IT and finance, for example, are more closely aligned to the skills gap in Northern Ireland.

A prospective Social Value Act would include not just the requirement on public authorities to maximise social value but the imposition of conditions on grants used for procurement that require a demonstration of social value.

One key strand in the legislation is that of an early-stage duty to ensure social value forms an integral part of procurement. More controversial is the proposed challenge mechanism aimed at bodies or organisations that have not exhibited sufficient commitment.

The Act started its legislative journey in the form of a Private Members’ Bill from Alliance MLA Stewart Dickson. Championed by the Assembly’s All-Party Group on Social Enterprise and group secretariat Social Enterprise NI, the draft legislation was then taken up by the Department of Finance, under former Minister Máirtín Ó Muilleoir. The Department’s Procurement Board gave the green light to the bill in January.

Some pre-consultation work has been carried out already but no further movement is possible until the Assembly returns. Even then, a future Finance Minister must be content to carry on the progress already completed.

The equivalent Social Value Act in England and Wales was reviewed by Lord Young and his 2015 report found there to be varying levels of implementation. Feedback from organisations included a call for the financial threshold to be lowered, as well as making sure it applies to goods and not just services.

In light of the lessons learned from that review, the All-Party Group will continue to play a key role advancing the cause of the Act, keeping it on top of the agenda and acting as an essential stakeholder in departmental engagement.

Indeed, a codified approach to social value may aid in providing innovations and solutions for public sector procurement. As the basis of the current Programme for Government, outcomes, rather than technical specifications or a supplier’s process, should be at the core of procurement.

This also represents an opportunity for the community, voluntary and social enterprise sectors to display their capabilities and achievements. They can provide support and guidance in procurement, pointing to good practice in so doing and producing evidence of improved outcomes where social value has been the focus. The legislation requires promotion, though the sector is a crucial partner in highlighting the benefits of an Act to those wishing to avail of the opportunities on offer.

Any Social Value Act should help to foster a more favourable environment for societal change. It is hoped that this can go some way to challenging how we all think about where we buy our goods, services and products, along with the wider impact of our purchasing decisions.

For information: Stratagem is a partner of Loaf Catering, part of the NOW group social enterprise. Together they deliver the successful #CoffeeClub at party conferences.

Stratagem works with Social Enterprise NI, the voice for social enterprises and social entrepreneurs in Northern Ireland, in its efforts to support a Social Value Act and serve as secretariat for the All-Party Group on Social Enterprise.