Review of social value act will criticise government, Hazel Blears says

The Labour MP and a member of the review panel on the act calls for a huge push from government departments to encourage public service commissioners to consider social value

Hazel Blears
Hazel Blears

The government’s review of the social value act is likely to criticise the use of the legislation by central government departments, review panel member Hazel Blears said yesterday.

The Public Services (Social Value) Act 2012 came into force two years ago and requires public service commissioners to consider the social value offered by bidders when awarding contracts. 

But a number of studies carried out by organisations including Social Enterprise UK and the National Council for Voluntary Organisations have found that the act has not been implemented by many public services and that awareness of the legislation remains low.

Last September, the government asked Lord Young of Graffham, the Prime Minister’s adviser on enterprise, to carry out a review of the act and its implementation. Young formed a working group, which included Blears, the Labour MP for Salford and Eccles, to help him carry out the review.

Speaking in London yesterday at the Social Value Summit, organised by Social Enterprise UK, Blears said the review had looked at the commissioning practices across different sectors and found central government to be "the weakest link". She said a huge push was needed across central government to encourage commissioners to consider social value.

"We have got lots of local authorities doing this, lots of good private businesses doing this and social enterprises absolutely get this," she said. "Central government really needs to push on."

Blears said she would like the Prime Minister to ask each secretary of state to produce a report outlining what their department was doing to implement the legislation.

The review was also likely to include a call for public bodies to appoint "social value champions" to encourage implementation of the social value act in individual organisations, said Blears.

Nick Temple, deputy chief executive of SEUK, said it supported the measures identified by Blears. "Social enterprises are well placed to deliver on the government's three priorities for civil society: empowering communities, opening up public services and promoting social action," he said. "With this in mind, it is disappointing that central government departments, with some notable exceptions, have been slower than their local authority counterparts to develop social value policies and demonstrate leadership on the issue so far. So the idea of social value champions in government departments is exciting, but we would need more details."

Speaking earlier in the day, Lord Young, who did not disclose the findings of the review he is leading, told delegates that further action was needed to measure the social value organisations provided.

"Social value will work perfectly if we can compare two prices – one with a social value element and one without one – and make a fair judgement about which is the most advantageous," he said. "This means we have to find an objective way to value the social value element of any contract."

Lord Victor Adebowale, a crossbench peer and chief executive of the social care charity Turning Point, told delegates he wished there was an industry standard for measuring social value. "We account [financially] for things on a standard basis, but we don’t account for social value on a standard basis," he said. "I appreciate the hymn against bureaucracy, but some bureaucracy is important."

Adebowale said social enterprises and socially responsible businesses should come together to develop standards for measuring social value.

Tom Fox, policy lead at UnLtd, a charity that supports social enterprises in the UK, said: "Lots of social entrepreneurs are finding it hard to access public sector and other markets. Unless we quickly come up with ways in which we can properly and consistently measure social value, social entrepreneurs will miss out because the value they are creating won’t be properly captured. Instead, there’s a danger that indicators will be used that don’t capture the whole story."

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