Government to make “social value” central to procurement deals

A new initiative by the British Government will make the evaluation of social value a…...

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A new initiative by the British Government will make the evaluation of social value a core consideration in all major Government procurement projects.

Speaking to the “Reform” think tank, David Lidington, Chancellor of the Duchy of Lancaster, announced the initiative, which will become an obligatory extension of the Social Value Act, as opposed to a mere advisory consideration.

Mr Lidington went on to say that the initiative will also require central government departments to provide regular updates on the social impact of new procurements. All of the 4,000-strong contingent of commercial buyers working for central government will receive training on how to include social value in their routine operations and proceed with successful procurements from social enterprises.

He added: “By doing so, we will ensure that contracts are awarded on the basis of more than only value for money – important though that is – but a company’s values too, so that their actions in society are rightly recognised and rewarded.”

This suggests that core procurement functions like organisational cost reduction and tail spend management will remain in place but will compete with new duties, which Lidington described in terms of “action plans for how they plan to address key social issues and disparities.”

The latter will include the representation of black and ethnic minority staff in their workforce, the gender pay gap and efforts to counter the blight of modern slavery.

His remarks were welcomed by Sean Haley, UK & Ireland Chair and MD of Service Operations at international food services and facilities management company Sodexo. Haley said that, while the speech contained numerous important messages, the central one for him was the most obvious: in order to outsource in a way that delivers and restores public confidence, “we must get it right from the start.”

Haley said that Lidington had taken a big stride in the direction of building trust by extending the Social Value Act to place social value and outcomes at the heart of Government procurement.

Nick Ford

Nick has over 30 years procurement experience in consulting, outsourcing and line roles within industry with international experience across many sectors and industries and led many procurement programs with blue chip organisations.

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