Conor Murphy MLA: Placing social value at the heart of public procurement

Placing social value at the heart of public procurement

Finance Minister Conor Murphy MLA outlines the initial impact of the newly introduced policy of mandatory scoring of social value within public procurement.

On 1 June 2022, a new Executive policy came into effect making it mandatory to score social value within public procurement. Since then over £78 million worth of government tenders have been published which include social value in the award criteria. These tender opportunities cover a range of areas including facilities management, IT and construction.

Evaluating social value alongside quality and cost provides a more complete assessment of the best tender. It rewards companies for doing the right thing while ensuring the Executive harnesses its £3 billion spending power for the good of society. The new policy applies to tenders for services contracts worth over £123,000 and construction contracts with a value over £4.7 million. These make up approximately 95 per cent of the total value of government contracts. So, the policy undoubtedly represents a step change in how we do procurement.

The Procurement Board, which developed the policy, rightly advised that such a significant change needed a period of preparation. A lead in period of approximately nine months was therefore provided to ensure the transition was as seamless as possible. An extensive training programme was put in place for both industry and government. The Strategic Investment Board’s (SIB) Social Value Team delivered 70 seminars right across the North to public sector bodies and industry. SIB has also rolled out elearning tools to suppliers, voluntary, community

and social enterprise (VCSE) organisations and public sector commissioners to ensure they were equipped to implement this policy.

Suppliers bidding for public contacts can deliver social value by choosing from a menu of options including: employment and training opportunities for those who face barriers to employment; promoting ethical supply chains to tackle modern slavery and protect human rights; net zero carbon and environmental protection and improvement; and measures to support the health and wellbeing of the contract workforce. This flexible approach enables suppliers to tailor the social value outcome to the circumstances of the individual contract.

Social value is fundamental to the ethos of VCSE organisations. As such, they are well placed to meet the social value criteria included in public contracts. I also want to see government make more use of the facility to reserve contracts for organisations with a social purpose or whose main aim is the social and professional integration of disabled or disadvantaged persons.

In May 2022 Usel, which supports disabled and disadvantaged people in the workplace, was awarded one of the first ever government contracts reserved for organisations with social purpose. Awarding of this £317,000 contract helped to create 15 jobs for people with health conditions and disabilities by providing sustainable jobs, training and support. In the health sector, suppliers providing vehicle maintenance services are now sourcing uniforms and printing from social economy organisations that employ and train people that face barriers to employment, providing new skills and improving future employability.

Suppliers and the public sector recognise the benefits of considering social value at the outset of tender opportunities. In order to build on this momentum, the Executive will be asked to increase the minimum weighting for social value to 20 per cent from June 2023.

I hope that the Executive agrees to increase the emphasis on social value so that its spending power can deliver more economic, environmental and wider societal benefits.

You can find details of government contract opportunities at www.etendersni.gov.uk/

Finance Minister Conor Murphy MLA during a visit to USEL.

Profit with purpose

Colin Jess, Chief Executive, Social Enterprise NI.

Much has been said about the current economic situation and the increasing pressure that rising fuel, energy and food costs are having on businesses. Despite this, Colin Jess, Chief Executive of Social Enterprise NI, remains positive.

The pressure on businesses is no different for social enterprises which face the additional challenge in that reduced profits and diminishing returns means less impact, less support provided to those marginalised in society and less support for those furthest from the labour market. In effect, social enterprises face a business challenge on two fronts.

“As the representative and membership body for social economy businesses in Northern Ireland, we are delighted to see more members developing social partnerships and delivering goods and services of quality alongside their private sector competitors,” says Jess. “Daily, there are an increasing number of enquiries from private and public sector businesses who want to include social enterprises within their supply chain, seeing the real impact on their own business of working alongside the sector.”

Without doubt progress had been made on several fronts over the past 12 months, with Social Enterprise NI leading the sector forward. Social Enterprise NI membership continues to grow, alongside increased numbers attending events. Jess also says, “With this being our 10th anniversary, our awards evening on 14 October will be a celebration of the sector with this year’s applications up 25 per cent on those of previous years, a clear indication in the growth of the sector.”

The pursuance of social value legislation in Northern Ireland, the only part of the UK which does not recognise social value in procurement, remains a real focus for Social Enterprise NI. The appointment of Jess by the Minister of Finance to the reconstituted Procurement Board is clear recognition of the role of social enterprise and this has created the opportunity for the sectors views to be heard at the highest level. According to Jess: “The successful launch of Public Procurement Notes (PPN 01/21 and 02/21) is just the beginning. PPN 01/21 ensures that central government allocate a score of 10 per cent of contracts to social value with a commitment to consider raising this to 20 per cent in June 23 following consultation. PPN 02/21 also promotes the use of reserve contracts for organisations employing 30 per cent or more of their workforce from a disadvantaged background, a process which is more widely used and accepted in other parts of the UK. Both are a huge step forward for the sector however we will still pursue social value legislation, similar to that in England and Wales, to encompass all public sector expenditure.”

Social Enterprise NI is also partnering with Ulster University to create a Transformation Academy and in this regard is hosting workshops with central and local government with a view to providing commissioners with the necessary tools, skills, and technics to drive innovation and transform the delivery of public services while ensuring and enabling the successful delivery of policy outcomes.

But how can the views of social

Right to left: Diane Forsythe MLA; John Blair MLA; John Stewart MLA; Cate Conway, SENI Ambassador; Seamus Corrigan, Envirocare; at the last All Working Party Group meeting in May 2022.

enterprise be heard at the heart of the Northern Ireland economy where it belongs? Jess is championing the need for a National Strategy for Social Enterprise for Northern Ireland. “To have a strategy and policy signed off by all government departments and political parties to support the growth of the sector in Northern Ireland would be a huge step forward and confirm the position of the social economy at the heart of government thinking, and indeed any future Programme for Government. It was clear in the length of time it took to receive financial support during Covid, that the lack of such a policy had a detrimental impact on the social enterprise sector overall.”

Whilst the social economy is mentioned within consultations such as the 10X economy document, this comprised of three short paragraphs and did not reflect the strength within the sector and how it can deliver real impact to support those at most need in the community. The sector needs to be taken seriously and Social Enterprise NI are working with the Department for the Economy to deliver a National Strategy as soon as possible.

Social Enterprise NI will also publish a database of all social enterprises based in Northern Ireland and this will be available in the coming months. This will provide information by business sector and location and enable private sector to select which local organisations they should choose to partner with.

Social Enterprise NI would like to put on record its thanks to the All-Party Group at Stormont who provide support and are already individually championing the need for a National Strategy along with a Social Value Act for NI.

As we approach Global Entrepreneurship Week (14-18 November), please look out for the activities of social enterprises in your area and give them your support. Why not consider engaging with local social enterprises and create social value in your work, like many other private sector businesses? Contact Social Enterprise NI to see how you can get involved.

Imagine a world where business operates as a force for good and where profits or surpluses are recycled back into local communities to support those at most need. The social economy already operates in this environment. So, let’s work together in partnership; come and join us and play a part in creating a new economy for all and generate real profit with purpose.

“To have a strategy and policy signed off by all government departments and political parties to support the growth of the sector in Northern Ireland would be a huge step forward and confirm the position of the social economy at the heart of government thinking, and indeed any future Programme for Government.”

T:+44 (0)28 9046 1810 E: colin@socialenterpriseni.org W: www.socialenterpriseni.org