Social value is a great way for us to seek benefits for our communities and residents when commissioning and procuring services, above and beyond the main subject matter of the contract.
It's about how we and other public bodies (Shropshire Clinical Commissioning Group, housing associations, NHS commissioners, the police and crime commissioner), use their position as community leaders in their buying power to drive improvements to the social, economic and environmental wellbeing of our area. It means that when we're commissioning and procuring services we're required, by law, to consider any additional improvements we want to see and then, through procurement, to try and secure those improvements.
Social value can come in many forms. For example:
- New jobs created for Shropshire residents
- The amount of money or percentage of turnover that businesses or organisations spend in the local supply chain
- Inward investment to Shropshire
- Volunteering opportunities
- Contributions to or support for local community-based initiatives, for example environmental cleanliness schemes or tackling crime and anti-social behaviour
- Supporting community groups
Social value legislation
The Public Services (Social Value) Act 2012 is a significant development in embedding social value in procurement. Whilst value for money is the overriding factor that determines our procurement decisions, this should include social, economic and environmental requirements.
The act fully came into force on 31 January 2013 and requires contracting authorities to consider at the pre-procurement stage of any services contract:
- How what is proposed to be procured might improve the economic, social and environmental wellbeing of the relevant area
- How, in conducting the process of procurement, it might act with a view to securing the improvement
The legislation applies to all ‘services’ contracts and framework agreements (including goods and works contracts procured in combination with services where the value of the goods is less than the services, and where the works are incidental to the services) to which the Public Contracts Regulations 2015 apply (£181,302 threshold).
However, while the legislation doesn't specifically require contracts for public works or public supply (goods) or contracts below the threshold to consider social value, we're committed to applying social value to contracts of any value.
We've prepared a useful guide to social value, which contains links to other resources. The government has also produced some related useful information and case studies.