Social value involves consideration of how resources are allocated and used beyond the value of a contract. Social value involves thinking about how each contract can generate wider benefit to the community. Chris White MP introduced the Public Services (Social Value Act) to parliament. He explained:
“We mean “value” not in its narrow sense but in its true sense – recognising the importance of social, environmental and economic well-being across our communities and in our lives’”
The cuts in public sector budgets have drawn attention to the need to ensure each pound spent results in maximum benefit. Spending decisions are now more open to scrutiny; there is more focus on the quality of the commissioning process; and a greater understanding of the need for commissioners, providers and other stakeholders to work together pre-procurement.
The Public Services (Social Value) Act
The Public Services (Social Value) Act 2012 was passed at the end of February 2012 and came into force on 31 January 2013. The Act introduces a statutory requirement for public authorities to give regard to economic, social and environmental well-being in connection with public services contracts within the meaning of the Public Contracts Regulations.
The Public Services (Social Value) Act 2012 applies to:
• Public service contracts (including service contracts with a works or goods element) and frameworks for these contracts.
• The pre-procurement stage of the commissioning process. This relates to the work public services need to carry out to enable them to realise social value prior to commencing a procurement exercise.
• The Act applies to contracts to which the Public Contracts regulations will apply (contracts above the Official Journal of the European Community (OJEC) procurement thresholds). This includes framework agreements above the thresholds.
The Act states:
The authority must consider how—
(a) what is proposed to be procured might improve the economic, social and environmental well-being of the relevant area, and
(b) in conducting the process of procurement, it might act with a view to securing that improvement.
For more information on the Public Services (Social Value) Act 2012 see: Social Value Act
Which organisations does the Act Apply to?
The Act applies to local authorities, government departments, NHS agencies (including clinical commissioning groups), Fire and Rescue Services, Housing Associations and police services.
Shropshire’s Social Value Group
Shropshire’s Social Value Group brings public sector organisations together with representatives from Shropshire’s Voluntary and Community Sector to share learning about social value, and to work together to implement a joint approach. Key aims of the group include:
- Working together to research and communicate best practice for measuring, articulating and making social value real.
- Agreeing a consistent message, communicating what social value means in Shropshire and how to get involved.
- Agreement of priorities for social value activity.
- Design and delivery of the group’s Social Value action plan.
To find out more about the group contact Neil Evans, within Shropshire Council’s Commissioning Directorate.
Telephone: 01743 255927.