How do we deliver true social and economic value for the community?

The 2012 Social Value Act was an important landmark. It decisively addressed the need for major public projects led by all public bodies to maximise the value of public investment by delivering wider benefit – social value – for the community. It has meant public investment in new buildings and infrastructure has created new community facilities as well as jobs, training and local spend.

Whilst it is true to say that in the six years since the Social Value Act was introduced, significant improvements have been made in driving measurable community-focused activities within procurement, it is important to reflect upon the key questions that first prompted the Act’s introduction. Perhaps the most important is ‘how do we maximise the social value being delivered through public projects?’

Putting social value at the heart

The answer to this can only be found in robust and easily comparable metrics and data. Only then can we begin to understand other key questions: is all ‘social value’ of equal value? How can public bodies – already stretched on resources – remain in control and ensure they are able to identify that they are getting the right results to suit their needs at a local level, when there is already so much to consider on major public projects? What does ‘good’ look like? Most importantly, how do we know that we are delivering the activities that communities really need?

When all potential aspects of social value are considered, contracting authorities can be presented with an extensive array of metrics that can be difficult and time-consuming to analyse and compare. Social value analysis can quickly become a complicated minefield for the public sector, who simply want to ensure they are getting the best possible local community outcomes from their investment.

Keeping it simple

Contractors naturally want to keep their clients happy, but public sector organisations must have clear and unambiguous objectives and metrics to ensure they are delivering both the maximum social value and the right kind of benefits for their community. Social value cannot simply be an afterthought to a contract; achieving these superior outcomes requires a more sophisticated approach to the assessment of social value impact. In our Better Procurement report, a response to the Government’s consultation on its proposed Industrial Strategy, we called for the Government to provide clearer national guidelines for public sector organisations on social value delivery. We believe this would help to provide clarity and guidance for the public sector, as a whole. However, social value is, ultimately, an empowering tool for local authorities, and so it is right that they too are defining what ‘good’ social value looks like when commissioning and delivering major public projects.

Measuring social value

In partnership with the Social Value Portal (SVP), we have been working with the public sector across the UK to devise a clear structure of social value deliverables that councils in particular will be able to recognise, measure and prioritise. In addition to using Key Performance Indicators to measure outcomes, such as local spend and labour, SME and Micro Business Engagement. Together with SVP, we have developed a series of Themes, Outcomes and Measures (known as TOMs), which will be included in all of our future frameworks and will form part of the quality evaluation. Used for measuring, reporting and valuing social value outcomes, our TOMs will provide greater clarity for all parties on built environment contracts, but will also offer flexibility while maximising quality and local impact in the delivery of social value through public procurement.

It is our view that we need to keep it simple. The key principles for measuring social value should be:

• Jobs and the promotion of local skills and employment
• Growth and supporting regional businesses
• Healthier, safer and more resilient communities
• Environmental protection and improvement
• Innovation

Our commitment

Our commitment to social value delivery is clear: we will continue to collaborate with organisations across the public sector to shape and implement social value. Together we can ensure that social value is not just at the forefront of procurement policy, but that we are delivering what communities really need.