Social Value is part of the public procurement landscape across the UK. At one level, the desired end results are very similar, but terminology and methods of delivery vary and it is important to recognise and respond to differences of approach.
In Scotland, the legislative focus is on “sustainable procurement”. Community benefits clauses have been a non-mandatory feature in major contracts in Scotland for some time, but the legislative impetus was created by the implementation of the Procurement Reform (Scotland) Act 2014, which, like its English equivalent, the Public Services (Social Value) Act 2012, places an obligation on public sector bodies and lays the foundations for the systematic delivery and reporting of social value in the Scottish public sector.
Inclusive Growth
Unlike England, which has a standalone piece of legislation, Social Value in Scotland is explicitly part of a broader agenda. In keeping with the Government’s inclusive growth strategy, Scotland’s Procurement Reform (Scotland) Act 2014 is an important element of the Public Procurement Reform Programme, which places procurement, as the Scottish Government says, “at the heart of Scotland’s economic recovery”.
The Procurement Reform (Scotland) Act 2014 requires commissioners to think about their stakeholders before they begin a procurement process, the impact of the services they intend to buy and how they intend to buy them. The Act is viewed as a social reform agenda.
While procurement is seen as a driver for economic growth, the Scottish Government wants this to be delivered by placing sustainable and socially responsible purchasing at the heart of the process.
The power of public spending is therefore seen as delivering public value which goes beyond cost and quality in purchasing and rather reflects a model of price versus growth versus sustainability. Conceptually, the model is designed to be business friendly and socially responsible.
Community Benefits
Community Benefits have been part of procurement policy and practice in Scotland since 2008.
They are covered by clauses within contracts which specify a wider range of benefits in addition to the principal purpose of a public-sector contract, such as local buying, training and apprenticeships, educational opportunities, etc.
The rationale for including Community Benefit clauses in contracts is to create a method of implementing social inclusion and economic factors into contracts for the supply of goods, services and works which do not usually intrinsically encompass these outcomes.
The motivation for Community Benefits clauses originated from public sector organisations but progressively contractors have embraced them as a means to demonstrate their broader commitment to society and support the delivery of their CSR agenda.
Historically, sustainable procurement and community benefits have tended to be treated separately. Sustainable procurement is seen as primarily focused on environmental outcomes, whereas Community Benefits have been about local social and economic needs. The Act brings these concepts together, in effect laying the groundwork for an integrated approach to Social Value.
Case Studies
Comhairle nan Eilean Siar (Western Isles Council) (CnES) and the Highland Council provide examples of how the application of Community Benefits clauses can deliver Social Value. CnES used a Targeted Recruitment and Training (TRT) clause to foster skills development and apprenticeship prospects across its capital works and audio/visual contracts. Highland Council incorporated various Community Benefit clauses into its ICT service delivery contract such as a TRT clause to challenge youth employment issues; environmental matters and community engagement.
For the City of Edinburgh Council, Sustainable Procurement Policy means that their approach towards buying goods and services is one which benefits local economy, society and the environment while simultaneously providing benefit to the Council and provides value for money. It considers the negative or positive impact on people, places and species both locally and globally. An example of this is its Sustainable Timber Policy. The Council will also use a third-party agency, if necessary, to verify that the timber has been legally and sustainably managed and sourced.
Other case studies illustrating the impact of sustainable procurement policies on Scottish communities can be found here.
Implementation Tools
Various sustainable procurement tools have been developed on behalf of government to ensure a structured approach to implementation.
The Sustainable Public Procurement Prioritisation Tool has been designed to help all procuring organisations in Scotland structure an approach to the valuation of spend categories. The tool specifically concentrates on the Government’s principles of increasing sustainable economic growth and maintaining the outcomes-based approach to procurement.
The Sustainability Test is used to incorporate relevant sustainability conditions into frameworks and contracts.
The Life Cycle Impact Mapping Tool helps users identify and assess their sustainability risks and opportunities. A contractor could use this to identify the social, economic and environmental impacts of individual procurements as well as identifying points of opportunity for good working practice.
The Flexible Framework Assessment Tool is used to support procuring organisations evaluate their present level of performance and the measures they need to carry out in order to improve.
Reporting
Public authorities in Scotland now have an obligation to report on their sustainable procurement.
This financial year sees some important developments in public procurement. Scottish Ministers will present an annual procurement report to Parliament by the end of 2018, following the publication of the Annual Procurement Reports by individual public bodies (local authorities, etc.), that are expected at the end of 2017-2018 financial year. Data is currently being collected this year so there are not yet any reports with these findings. This time next year we will have a better feel for how the Scottish public sector is working with these requirements.
Concluding Thoughts
The Social Value Portal is about providing an evidence based approach to Social Value. Our tool reduces the amount of speculation around Social Value and replaces it with data. Tools need to save time rather than increase work load and therefore, what Social Value now needs is an evidence based tool like The Social Value Portal’s calculator.
