Social value: Fluffy, yes. But just look at the benefits

30 Mar 15

Two years after a Private Member’s Bill put social value onto the statute book, Public Finance reports from a CIPFA summit to assess progress.

Volunteers working at a food bank

Boxing clever: many retired people, like these food bank volunteers, have the time and experience to help out. Photo: Alamy

The 2012 Public Services (Social Value) Act recently passed its second birthday. It got onto the statute book thanks to the hard work of Conservative backbencher Chris White, MP for Warwick and Leamington, who introduced the legislation as a Private Member’s Bill shortly after the coalition government was formed.

What the Act does is require public service commissioners to consider how their procurement activities might improve the economic, social or environmental wellbeing of their areas and how these gains can be built into the procurement process.

On March 11, CIPFA invited a range of commentators and practitioners to a summit to consider the broad question of social value and how the agenda might move forward. Social value can be dismissed as being at the ‘fluffy’ end of the spectrum and hard to do in the current fiscal climate, but there’s a growing sense that this is an area finance professionals need to engage in because of the wider value and benefits it can secure.

‘People think they haven’t got time to do social value,’ said Jayne Stephenson, a CIPFA council member and chief finance officer for the Greater Manchester Police and Crime Commissioner, at the meeting. ‘But I tell them they can’t afford not to do it.’

The summit was timely, as a Cabinet Office review of the legislation, led by Lord Young, the prime minister’s adviser on enterprise, was published in February. The review attempted to assess how the Act is working, who is using it and how.

Aigneis Cheevers, the civil servant who led the secretariat for Young’s review, told CIPFA’s summit that the review team had been struck by the range of stakeholders engaging in social value.

‘We unearthed lots of good case studies where the Act is having a very positive effect,’ she said. ‘People are using the Act to do things differently. The review clarified the Act’s potential as a tool for smarter procurement and delivering real value for money.’

But the review also uncovered barriers that are preventing the law from gaining the traction it might. Awareness and take-up is mixed. In general, local authorities and housing associations are leading the way, while central government and health are not making as much use of its provisions.

On the provider side, there is a high level of awareness among voluntary sector organisations and a growing understanding among big business, but a fairly low level of recognition among smaller firms. Cheevers also noted thatthere are inconsistencies in how the Act is applied, with some very different approaches to how social value is commissioned and how it is evaluated. ‘This mixed understanding is preventing people from running with it,’ she said.

Finally, commissioners don’t know how to measure and quantify social value gains. ‘People feel they’re leaving themselves open to making a subjective judgment – and they don’t want to do that as commissioners,’ Cheevers added.

The Young review concluded these barriers need to be overcome before the reach of the Act might be extended. Cheevers added the Cabinet Office is currently considering what the best next steps might be. ‘We don’t want to lose any of the momentum we gathered over the last four months [of the review].’

Tony Bovaird, professor of public management and policy at the University of Birmingham, told the summit that ‘huge change’ to the way social value is commissioned is under way. He focused on the potential benefits of co-production, whereby citizens and service users are actively involved in the design, delivery and evaluation of public services.

‘In principle, co-production flies in the face of everything we’ve done since the 1880s, but that way of doing things has finished,’ Bovaird said. ‘We need new provider models – and we’ve got them.’

Bovaird described how to address the lack of alignment between community resources and community needs. For example, rather than seeing the ageing population as an impending disaster, the skills and energy of fit and healthy retirees could be mobilised, while many public amenities, such as schools and day centres that are closed for large parts of the day, could be used for more activities.

‘We are not remotely resource poor, but we have been unable to match the resources we have to our needs.’

The advantage of co-production, he said, is that communities often know things that professionals don’t, and it helps to preserve community links and contact that is highly valued by potentially vulnerable groups, such as elderly or disabled people.

Social and economic value can emerge in surprising ways, he noted. Members of South Somerset Community Speed Watch work with police to carry out speed checks on cars passing through their towns and villages. Bovaird said this has not only secured a 40% reduction in vehicles exceeding the speed limit, but also boosts the local economy as volunteers buy a cup of tea in a cafe or a pint of beer in the local pub after their shift.

Bill Guthrie of business advisers Newton Europe gave some practical insights into how the approach outlined by Bovaird could work in pratice. 

He described the 'whole system transformation' underway at Kent County Council. Newton has been working with KCC to help the council refocus very clearly on where it wants to get to and what it wants to achieve, a dialogue that has involved staff, service users and citizens and a review of systems, processes and service points.

'You need to be very clear about what good would look like,' he said.

Many of Bovaird’s points were also echoed by Henry Kippin, director of Collaborate, a policy and practice hub, who suggested that people’s increasingly complex needs and demands require equally complex responses from services.

The model of increasing economic growth leading to ever greater service entitlement has gone and a rebalancing of relationships between service users, providers and communities is going to have to take place. ‘An eco-system is what we’re aiming for. It’s about interdependence,’ Kippin said.

He questioned whether the public service frontline might be changing, shifting away from traditional service centres to high streets and barber shops and post offices.

‘How do you mobilise that and generate a sense of common purpose?’ Behaviour, culture and relationships all needed to change and it was therefore ‘disconcerting’ the Cabinet Office review had uncovered relatively low levels of awareness, Kippin observed.

One summit attendee, Keith Ward, head of social impact advisory at Baker Tilly, agreed it was disappointing that the Social Value Act has not yet delivered on its early promise. ‘The Act has been largely ignored or misunderstood. As long as it stays a permissive piece of legislation, it’s not going to deliver its potential. We need more campaigning and vigour.’

The barriers identified by the Cabinet Office are ‘colossal’ and the review rather undersold them, Ward suggested.

But Stephenson said hearts and minds need to be changed rather than legislation. ‘That’s the approach we want to promote at CIPFA.’

CIPFA’s Dee Noonan and Brett Crabtree put the summit programme together. Noonan said: 'If we're invested in ensuring real value for money and making services really work for the benefit of users, social value legislation is a transformation tool that we can't afford to ignore.'  

Crabtree added that the institute is ‘keen to push awareness of social value as a tool to create new solutions in delivering social outcomes and securing best value for providers’.

  • Vivienne Russell

    Vivienne Russell is managing editor of Public Finance magazine and

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