Delivering Social Value
09 May 2022 16:52
In the summer of 2021, Finance Minister Conor Murphy announced that policy within public procurement is changing and from 1st June 2022 public procurement will no longer solely award contracts based on cost and quality but tenders (above threshold) must allocate a minimum of 10% to social value. This will apply to service contracts valued above £426,000 and construction contracts valued above £5.3million.
Social Value will be scored based on the following themes:
- Theme 1: Increasing secure employment and skills
- Theme 2: Building ethical and resilient supply chains
- Theme 3: Delivering zero carbon
- Theme 4: Promoting wellbeing
Each of these themes will have a set of indicators.
So what is social value?
It’s the value that we bring to society through our work, which can be done in lots of ways, for example - enabling employment, delivering greener energy initiatives, providing education, promoting health and wellbeing initiatives and supporting the local economy.
Public Procurement in Northern Ireland spends in the region of £3 billion annually on supplies, services and construction works, with NI Water accounting for, in the region of £300m of this spend.
This level of expenditure can offer suppliers the potential to drive meaningful, impactful and positive change in the communities they serve and operate.
Some of what the Finance Minister, Conor Murphy said,
“This new policy will help create jobs for people in deprived areas and deliver environmental benefits by requiring contracts to employ low or zero carbon practices.”
“This new policy represents a significant step-change for both government and tendering organisations. It sees social value placed at the very heart of public procurement, setting new standards that rewards companies for doing the right thing while ensuring the Executive uses its spending power for the common good.”
How can the supply chain benefit?
It has been proven and demonstrated across various sectors that the inclusion of social value within public awarded contracts has not only the ability to deliver transformational community benefits, but businesses can also reap the rewards, where they can:
- Be seen as an employer of choice
- Create a more inclusive and diverse workforce
- Deliver greener energy initiatives – driving efficiencies
- Obtain and retain the best talent with teams with various skill sets
- Drive creativity and innovation
- Promote wellbeing initiatives – driving productivity
- Generate positive PR – reaching existing and new audiences
What is next?
As mentioned above from the 1st June 2022, scoring social value within public awarded contracts (above threshold) will become a legislative requirement.
To help the supply chain understand this further – NI Water and the Social Value Unit at the Strategic Investment Board will be hosting a Social Value Supplier Engagement session on Thursday 30th June 2022 as a hybrid event (blend of virtual and in person). The delivery of the live event will take place in Belfast City Centre, more details to follow.
For more information on social value you can visit - Social Value Unit - Strategic Investment Board (sibni.org)