The term social value has been bandied around for many years. Following the publication of Procurement Policy Note (PPN) 06/20, how can industry leaders go above and beyond with construction projects?
Ultimately, PPN 06/20, which was published in 2020, is public sector procurement best practice guidance aiming to drive forward social value and ensure capital projects include regeneration.
Improving the economic, social and environmental wellbeing of an area to ensure that spending of public money has a wide-ranging impact is something that we and many others wholeheartedly support.
However, one of the problems with PPN 06/20 is that despite its positive intent, it is still only guidance.
Without guardians of procurement in place to push for social value best practice, the complex responsibilities held by public sector organisations can lead to interest being focused elsewhere.
PPN 06/20 states that procurements above £10m should pay particular attention to weighting 10% of the contract value towards social value – but we should question why procurements under £10m are not advised on making the same commitment.
In fact, not believing there should be a limit, we push for all our procurements to have 10% of the contract value dedicated to social value as a minimum.
We appreciate sometimes public sector organisations want to be flexible with the 10%, so this is where the importance of delivering quality social value and efficient spending of public money becomes even more apparent.
Quality over quantity
When any sum of money is being spent to have a project delivered, discussing upfront where it will go and why should always be an important part of the procurement process.
Moreover, public sector spending on social value needs to directly address the needs of local communities – whether that’s getting people back into employment, offering specialist training or increasing local amenities or spend.
Framework providers need to embrace a proactive, hands-on and transparent approach to social value in support of clients and suppliers, to help influence outcomes that everyone is satisfied with and add value to the procurement process
Framework providers have the opportunity to embed specific social value objectives within tenders at the contract stage to make sure giving back becomes a part of the project specification and not just the evaluation process.
This way of operating was unheard of 15 years ago, but times are changing for the better.
Framework providers need to embrace a proactive, hands-on and transparent approach to social value in support of clients and suppliers, to help influence outcomes that everyone is satisfied with and add value to the procurement process.
Public sector organisations are understandably very cautious with expenditure, but so too are suppliers. So spending time at the beginning of the procurement process discussing and measuring ability to deliver social value aims will bring greater certainty and throughout the project.
Contract management shouldn’t end at tender stage either. Frameworks should be involved in schemes throughout delivery to ensure key performance indicators are being monitored and met, holding suppliers to account over what they signed up to.
Keep your finger on the pulse
Having enabled nearly £6bn in social value through our frameworks and set up our Developer Led Framework to increase regeneration possibilities, we’re committed to maximising potential and pioneering ethical procurement – not just ticking a box or including a process for the sake of it.
An experienced framework team needs to be maintaining its position at the heart of industry, keeping its finger on the pulse and understanding how best suppliers can support public sector organisations with their unique social value goals.
Government directive may exist in the form of PPN 06/20, but any ethical framework provider can and should go above and beyond.
Jonathan Parker is development director at Pagabo.