It’s good that the public sector is now required by law to take into account social benefit when commissioning services. But the strength of the legislation derives from its ethos and ability to change behaviour rather than the legal content
Chris White’s Private Members Bill requiring public sector commissioners to take into account social as well as financial value was enacted last year and came into force on 31 January 2013.
The Public Services (Social Value) Act is a very welcome piece of legislation and White should be congratulated for his efforts. But the gain is not in the precise legal content, for there are a number of areas that lack clarity.
Principally, it is not yet clear how a local authority or other public body will be held to account legally for failing to address the act’s intent. And it is unlikely that many voluntary or social sector organisations will wish to challenge a commissioning decision on the basis that social value had not been properly taken into account, not least if this could damage their relationship with a local public body.
While I hope there will be few cases where an aggrieved organisation wishes to mount a challenge, in practice I fear there will be many occasions when social sector organisations and the public will wonder why a procurement process has led to the selection of a provider that is prima facie inappropriate.
The strength of the act springs from its ethos and objective rather than from its legal content and powers. It clearly sends the signal that Parliament considers that public sector procurement should take into account more than price and service quality.
Many progressive local authorities were already doing this, but too many were not. Now voluntary sector organisations, staff, service users and local citizens can demand that they do without being fobbed off with the lamentable but all too frequent response ‘we can’t do that because the law doesn’t allow us to’.
This represents major progress. Local authorities and other public bodies should have clear social, environmental and economic goals for every pound they spend, including money spent on the external procurement of goods and services.
They need to be open about these goals, consult on them and share them with the public, staff, current and potential providers and their local public sector partners. Within the legal constraints of public procurement regulations, they can and should press these wider objectives. They also should be clear about how they will measure them pre- and post-contract, take them into account in tender evaluations, and hold providers to account for them.
These requirements should be based on dialogue with the voluntary and community sector as well as the business sector. Such dialogue will also have secondary benefits in that it should lead to better informed commissioning and procurement as well as shaping in-house public sector provision.
The act is not telling the public sector that it should only procure from the social and voluntary sectors. That would be as wrong as it would be unlawful. However, it should make procurers stop and think about the shape and nature of their processes in order to make it easier for these sectors to bid and to be considered seriously.
If they are to take advantage of the act, then voluntary, community and social organisations will have to be able to demonstrate not only their ability to deliver the outcomes being sought by the public sector commissioner but also how they will add social value. The hard fact is that being a charity or a social enterprise does not automatically equate to adding social value, especially in the context of a public sector contract, nor does it give any organisation the right to expect to win every tender that it submits.
Business sector organisations will seek and in some cases may be able to demonstrate and prove that they can add social value too. Public sector providers should have to demonstrate the same social benefit and for them this ‘should’ be relatively easy or else what are they are about? Again, however, there should be no automatic presumption here. There is no room for complacency or arrogance.
Measurement of impact will be vital for both public sector clients and providers. However, the act will have failed if it simply leads to another set of questions and tick boxes or to overly onerous requirements in the procurement or service delivery stages. If the latter occurs, then it will have deterred rather than encouraged more socially-based organisations. In the wrong bureaucratic procurement officer or legal adviser’s hands, it all too easily could be become a game of compliance with the letter rather than the spirit of the law.
The Public Services (Social Value) Act has the potential to be the catalyst for new thinking and new behaviours leading to better outcomes. Alternatively, it could become a damp squib and huge disappointment. Behaviours and leadership across the sectors will determine which of these transpires – not another process manual.
I am an enthusiast for the Act and what it can offer but recognise its legal limits. I want more public services provided by the social, voluntary and community sectors. I also want the public and business sectors to add social value. And I want the public and service users to feel that they receive value for money, socially-focused, quality public services.
But, above all, I want to change mind-sets and behaviours and for more political leaders to champion a new approach to commissioning, collaboration and working with the social sector and communities. Maybe then, we can really secure sustainable social value.
John Tizard is a trustee of the National Association of Voluntary Community Action. Over the next few weeks, he will be chairing a series of workshops on the Public Services (Social Value) Act organised by Navca, the Local Government Association and Anthony Collins Solicitors LLP
