You would have been forgiven for missing the Procurement Policy Note  (PPN) 06/20 – taking account of social value in the award of central government contracts. This notice was released in September 2020 and came into effect on 1^st January 2021.  Unfortunately, the ongoing COVID-19 pandemic and Brexit meant that this PPN did not get the attention it might otherwise have received.

What are the implications of PPN (06/20)?

The PPN (06/20) describes the Social Value Model adopted by the current UK government which provides a methodology to financially quantify the impacts of various criteria e.g. training, apprenticeships to the wider economy. Bidders for government contracts then use this methodology to quantify the impact of their activities, e.g. training, apprenticeships. The sum of all the metrics is a social value score which is often expressed as a percentage of overall contract value, e.g. 10% of a contract value is generated by social value activities.

The PPN requires that all central government departments, their Executive Agencies including Non-Departmental Public Bodies must include social value in future tenders. Social value must be at least 10% of evaluation criteria. 

What is the Social Value model?

The Social Value model aims to quantify the wider benefits delivered by central government procurement covering the impact of economic, social and environment benefits.

What has changed as of 1^st January 2021?

The PPN is a significant strengthening of the previous Social Value Act 2012. This act had  required central government and associated Executive Agencies to only consider social value with no evaluation thresholds achieved. The social value requirement has now been included in a wide range of central government tenders that have been released since 1st January 2021.

How has Social Value been quantified?

The aim of the guidance describes the Social Value Model with the 5 key themes which are a priority:

COVID-19,

Economic Inequality,

Fighting Climate Change,

Equal Opportunity,

Wellbeing.  

It is up to the discretion of each government authority as to how they apply social value in procurement. So far, I have seen a range of examples covering

• Written response for social value only.
• Full list of over 60 Social Value measures with a response required for each social value indicator e.g. how many training days will be delivered as part of the contract and asking for a written rationale for each indicator.

Will social value add costs?

In theory no, the aim of social value is to quantify the benefits and existing good practice delivered by current spend and not require additional spend.

Can Social Value help UK government and companies to do more?

Yes, from our experience over the past 8 years, we believe this is possible. The key is to agree on the Social Value strategy before launching procurement and the client to agreeing the target themes to guide bidders in their response.

Effective contract management while in life to track progress is also very important. Making reporting as easy as possible for both the client and the successful company can really help to make reporting on social simple and understandable for everyone.

How do I find out more?

For more information, please see our Introduction to Social Value document in our downloads section. If you have any other questions, please get in touch with us to schedule an introductory call to talk about social value.