Measuring Social Value: The 268 Billion Pound Question
We were pleased to contribute recently to an Innovation Briefing on “Measuring Social Value” published by the New Local Government Network (NLGN) with Wilmott Dixon. To read the full Briefing then you’ll need to subscribe to be a member of NLGN which you can do here and you can also read Sarah Fraser of the Wilmott Dixon Foundation’s blog.
Where are we now?
How to measure social value is the million dollar question. Well, actually, it is the 268 billion pound question because that is how much the public sector spends on procurement each year. Last year £25bn of this spending was shaped by the Social Value Act and whilst this is a huge amount of money that has unlocked a vast amount of long-term benefits for people, communities, small businesses, schools, hospitals and the environment, the message is clear: there is a lot more that the private, public and third sectors can be doing to create more value from the public purse.
The Challenges of Measurement
The Briefing highlights the good work being carried out by Durham County Council, Orbis Procurement (Surrey & East Sussex County Councils and Brighton & Hove City Council) and Birmingham City Council. Each Authority is deep into its social value journey and has detailed policies, strategies and statements in place. Even so, there is a recognition of the challenges of measuring social value (therefore creating a barrier to unlocking more value from every £1 spent by the public sector) and there are three key messages to take away:
- Be specific. Start by thinking about exactly what impact you’re looking to create in the first place; figuring out where you want to end up will help considerably with determining what needs to be measured. However, there’s a resounding note of caution not to be too specific because then there’s a risk of deterring some potential bidders and missing out on possible innovative ideas.
- One size does not fit all. The Social Value Taskforce has developed a set of Themes, Measures and Outcomes (TOMs) for measuring social value as a minimum reporting standard, but these can also be tailored to report on a specific area, sector or business. Minimum requirements are crucial of course, not least for comparison purposes, but bespoke tools can create new possibilities for measuring impact.
- Don’t reinvent the wheel. Use the Social Value Maturity Index to figure out where you are in your social value journey at the moment. In all likelihood you are already more prepared than you think to measure social value and monitor the impact of projects and contracts in the long-term. However, see below for various links for further reading and the tools that already exist.
Going from adding social value to £25bn a year of public sector spend to tackling the full £268bn is a daunting challenge. However, when you consider the possible long-term benefits for our society it’s a challenge we should all be willing to accept.
There are a number of tools out there to support the public sector and private businesses to take their social value thinking to the next stage. The Briefing detailed some useful further resources as a starting point:
- Local Government Association (2017): Encouraging Innovation in Local Government Procurement
- NLGN (2016): Social Value in Procurement Public Services (Social Value) Act 2012
- Social Enterprise UK (2016): Procuring for Good: How the Social Value Act is being used by local authorities
- Social Enterprise UK (2017): Healthy Commissioning: How the Social Value Act is being used by Clinical Commissioning Groups
- Social Value International (undated): The Seven Principles of Social Value
- Social Value Portal (2017): National TOMs Framework 2018 for Social Value Measurement Guidance
- Social Value Portal (2017): Social Value Maturity Index
- Social Value Portal (undated): Bridging the Gap