It is good news and bad news as The Cabinet Office publishes its review by Lord Young of The Social Value Act today. Key Points ‘in a second’:-
- The Act is working where it is being applied properly
- The Act is delivering real benefits in terms of quality and cost savings
- Commissioners are permitted to consider social value as widely as they wish
- There is a real need for better measurement solutions
- A decision about extending The Act and making obligatory it has been delayed
- There will be a further review within the next two years to assess progress
‘’The first thing to note about the Act is that, where it has been taken up, it has had a positive effect, encouraging a more holistic approach to commissioning which seeks to achieve an optimal combination of quality and best value’’. Lord Young February 2015
We are delighted that Lord Young has recognised the positive contribution that the Act is already making and reaffirms our staunchly held views that The Act is a force for good.
Lord Young also says ‘’In the two years that it has been in force, the Act has made a good start in this respect, encouraging commissioners to think about securing value through procurement in highly innovative ways which have generated significant cost savings and demonstrated a much more responsive way of delivering better services’’.
We are also pleased to note that Lord Young (LY) has decided to intervene on the EU Threshold ensuring that the proposed EU increase is NOT applied to The Act although we do believe that The Act should be applied across all contracts including planning.
However, it is disappointing, although unsurprising that LY has decided not to make The Act obligatory and that it should not (yet) be extended.
On the one hand this is good news for those who want to avoid acting but news for Communities who are plainly benefitting from good application of The Act, this may provide an excuse more inaction.
We do note that LY has picked up on the fact that although Local Authorities are probably furthest ahead, and there has been a distinct lack of take up amongst many of our public institutions. Central Government (in our view furthest behind of anyone) gets a little stick as Lord Young has recommended that Central government should issue a cross-Whitehall paper on what each central government department has achieved to date on social value and work individually with central government departments to aid understanding of how social value might apply to them, and, where real potential is uncovered, agree a commitment to further action. No hiding then!
The Review identifies a number of key challenges including:-
- Awareness and take-up of the Act is a mixed picture.
- Varying understanding of how to apply the Act can lead to inconsistent practice, particularly around:
- knowing how to define social value and how and when to include it during the procurement process
- applying social value within a legal framework and procurement rules
- clarifying its use in pre-procurement.
- Measurement of social value is not yet fully developed.
The Review also describes some examples of good practice where either the quality of the service has improved or cost savings have been delivered. Plainly good practice examples are essential to ‘socialising the benefits’ and will speak for themselves in encouraging the ‘laggards’ who have not yet taken action.
‘‘In conclusion, I can see the many positive benefits being delivered by the Act…and I am excited about the Act’s potential (and) I would therefore recommend that a further review is undertaken within the next two years, to evaluate how much progress has been made against each recommendation, and what more should be done”. Lord Young
We understand from our ‘spies’ that Lord Young, a (welcome) campaigner against red tape, was initially sceptical about the value of The Act so that the fact that he has been persuaded about it benefits, speaks volumes on its success.
And finally, we are delighted to note that The Social Value is supported as a tool for measuring Social Value
.A full copy of the Review may be found here