Nick Hurd, the Minister for Civil Society, has proposed more than 20 amendments to a bill designed to strengthen the role of third sector organisations in public sector procurement, including the removal of a requirement for public sector organisations to prepare social enterprise strategies.
The Public Services (Social Enterprise And Social Value) Bill, a private member's bill put forward by Chris White, the Conservative MP for Warwick & Leamington, would require commissioners to consider the social value that would emerge from a contract, in addition to price.
The bill as it stands would require local and central government to develop social enterprise strategies. However, Hurd’s amendments would remove those clauses. They would also remove any reference to social enterprise from the bill’s name.
The bill will be debated at committee stage today. All parties have said they support the "social value" clause in the bill.
Peter Holbrook, chief executive of Social Enterprise UK, said that while the decision to remove the term ‘social enterprise’ could be "very bad news for the sector", the bill will put social enterprises in stronger position to compete for public sector contracts.
He said the government had always made it clear it supported only the "social value" section of the bill, and that the remaining sections could still considerably strengthen the position of social enterprises when bidding for contracts.
"The most important thing about this legislation is that it embeds the role of social value in the procurement process," he said. "Even with the proposed amendments, the bill will put social enterprises in a stronger position to compete for public sector contracts."
Gareth Thomas, the shadow minister for civil society, warned that the removal of these clauses meant the possibility that more new social enterprises could be bypassed in the award of contracts.
"After huge cuts in government funding for civil society groups, now the government wants to axe plans for vital legal requirements that could have helped social enterprises to flourish," he said.
Thomas said that if the government did not support social enterprise, there could be more cases such as Central Surrey Health, a flagship public sector mutual, which was controversially turned down for a £100m-a-year contract recently.