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Public Sector Procurement:
Maximising social value in public sector spending
The NI Government has always hoped to deepen the impact of its spending and to create benefits for Northern Ireland that go beyond simple economic metrics. In the recent past, we achieved these wider benefits using contract performance and recruitment and training clauses in public sector procurement processes. These clauses sought to encourage organisations undertaking work for the public sector to allocate a proportion of the contract’s total employment to people without substantial work experience. These include school or college leavers or those who were long-term unemployed.
However, in July 2021, the Executive approved a new Procurement Policy Note, PPN 01/21. The new policy note, which was developed by the Procurement Board led by the Finance Minister, mandates that from 1st June 2022, all services and works contracts where the Public Contract Regulations apply must allocate a minimum of 10% of the award criteria to Social Value. The new procurement criteria, also known as ‘Scoring Social Value,’ highlights a wider set of social benefits that might be achieved through a project’s entire life cycle. The new criteria also emphasise consulting with the communities affected by the project and establishing if contracts can be reserved for organisations with a social purpose. In short, Scoring Social Value formalises some of the previous guidance, broadens the criteria of social value to include other aspects of societal benefit and gives a more detailed view of how tendering organisations can demonstrate social value in their tenders.
What is social value?
The public sector in Northern Ireland supports significant economic growth and employment through its own operations. However, as an organisation which spends circa £3billion per year
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Works at Southern Regional College, Armagh.
in public contracts, the potential exists to broaden and deepen the benefits of this expenditure on the wellbeing of individuals, communities, and our environment. These wider societal benefits, both financial and non-financial, are referred to as ‘social value.’
Who defines social value?
The Strategic Investment Board, an arm’s length body of the Northern Ireland Executive, that supports government departments, local authorities, and other public bodies by helping them plan infrastructure, deliver major projects, and manage assets, incubated and developed the NI’s Executive’s approach to social value. Chief Executive of SIB, Brett Hannam says, “One of our key priorities in recent years has been to better harness the power of
Government expenditure through the inclusion of social value in the procurement of contracts.
To this end, we established the Social Value Unit in 2014 to advise public bodies and help them design, implement and monitor the social value in their contracts.”
Strategic Advisor Mary McKee leads the unit and explains, “In my prior career in the third sector, I experienced the difficulties faced by various groups of people across society. The long term unemployed, mothers who have taken time out of work to raise their families, care leavers and those with disabilities are a few of the groups who are often most distanced from the labour market. Through demonstrating how a social value approach could work with our partners in the Department of Finance, it became clear that we could devise a policy that would support those most
MPANI 2022 | 2023
