Social value act 'lacks teeth' and needs reform, report concludes

Peter Holbrook, the chief executive of Social Enterprise UK, says that too many councils still see the act as a duty rather than an opportunity

Peter Holbrook
Peter Holbrook

The social value act lacks teeth and needs to be strengthened, according to a new report revealing just a third of English councils routinely consider social value in procurement and commissioning. 

The report, Procuring for Good, published yesterday by the umbrella body Social Enterprise UK, used freedom of information requests to review the impact of the Public Services (Social Value) Act 2012, which calls for public bodies in England to consider how the services they commission and procure might improve the economic, social and environmental well-being of the area in contracts of more than €209,000 (£161,691).

It found that 33 per cent of councils routinely consider social value during the procurement process and that just 24 per cent of councils have a social value policy.

Just one in seven councils (14 per cent) were fully embracing the idea of social value, applying it frequently to contracts below the threshold, while almost one in five (19 per cent) applied it conservatively but also had a social value policy, framework or toolkit.

Of the 306 councils that responded, 45 per cent comply with the minimum required by the act by mentioning social value in their procurement strategy but apply it infrequently, while 22 per cent have no social value policy and make not mention of it in their procurement policy.

Smaller councils were less likely to embrace or adopt the act, the research found.

The report calls for legislative change to strengthen the act in order to compel its use by more public bodies.

Peter Holbrook, the chief executive of Social Enterprise UK, said in a statement: "Sadly too many councils still see the act as a duty rather than an opportunity.

"The act has been in force for more than three years but is not empowering local authorities in the way it could be, to the detriment of our communities.

"Legislative change is needed - the act lacks teeth and simply asking public sector bodies to consider the creation of social value when commissioning services is not enough."

But he said the research showed that, where the will existed, councils were using the act and going beyond its obligations to embed social value in the way they commissioned, describing the teams behind such work as "unsung heroes".

Neil Cleeveley, chief executive of local infrastructure body Navca, said in a statement that asking public sector bodies just to consider social value was not enough. "They need to demonstrate how they have done so," he said. "We have previously called for all statutory bodies covered by the act to be required to produce annual statements setting out their approach to social value and the effect it has had. The findings from this research provide more evidence of the need for such a measure."

Chris White MP, who tabled the act, said the research gave the first clear picture of the extent to which social value was embedded in local government. "Despite substantial progress, there is still a way to go before all councils are making full use of the changes to commissioning that the act makes possible," he said.

In February 2015, a review of the act by Lord Young of Graffham concluded that uptake of the act had been low, but rejected calls to strengthen the act through further legislation over fears it would increase bureaucracy.

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