What the Social Value Model Means for Public Procurement

Mar 20, 2021Bid Management, Research, SME Champions, Social Value, Tender Process

The Social Value Model was published as PPN06/20 back in September 2020 and applied to all Central Government contracts after 1st January 2021. We think that with the growing emphasis on social value seen in the Government’s recent green paper, we can expect the principals of the model to be rolled out from Central Government to other public sector organisations over time. In other words, if you want to future-proof your social value strategy, it’s worth keeping the social value model in mind.

Bid for Success are passionate about supporting our clients to deliver great social value about part of their bids, so in order to better understand this legislation, we recently took part in some training delivered by Social Value UK about the social value model. These are our key takeaways for SME businesses.

Social Value is Distinct from Core Deliverables

One of the seven pillars of social value is not to overclaim, meaning that the social value that you claim for each contract needs to be generated by that contract. You can’t claim social value for eight apprentices if only four of them will be taken on for that project.

The social value model takes this idea one step further, making social value distinct from the core deliverables; in other words, if the activity is part of what you need to do, do deliver the contract, then it can’t be claimed as social value.

Social Value UK have helped clarify this by using three different terms for social value. They are:

Inherent Social Value: These are the changes that occur as a result of the contract being fulfilled. For example, if you won a contract to renovate a school, that would have value to the pupils and the community.

Embedded Social Value: This is your company’s ‘business as usual’ social value. This is the type of social value that is delivered through apprenticeships and staff training, but also through your company’s environmental and supply chain policies.

Additional Social Value: These are the projects that you commit to that are outside of both other things; for example, where you offer ‘into work’ training for local people facing unemployment, or your staff volunteer to create a community green space.

We think this is a useful way of considering social value, and understanding what can be included in your offer under the new model; inherent social value is off the table, but both embedded and additional can be used as examples as long as you only claim for what happens as a result of that particular contract.

Social Value Model Themes

In the original guidelines for commissioners, there were three types of social value; economic, social, and environmental. The new model expands this to five which are linked to the UN’s Sustainable Development Goals:

COVID-19 Recovery: Helping communities to recover from the impact of the pandemic.social value model

Tackling Economic Inequality: Creating new jobs and training opportunities and increasing the resilience and capacity of supply chains.

Fighting Climate Change: Minimising the carbon footprint and respecting the environment.

Equal Opportunity: Reducing gender and disability gaps, tackling workforce inequality.

Wellbeing: Improving health and wellbeing (in your staff and communities) and improving community integration.

Weightings

Social Value now has its own weighting for central government tenders, making up 10% of the overall score. Procuring organisations can then go further with weightings, using it to highlight which of the themes they have identified as most important to them. For example, where there is high unemployment you might see Tackling Economic Equality being given a higher weighting.

To help you analyse your social value offer, we’ve put together this matrix document that includes the five themes and the three types of social value. This useful tool will help you get a better understanding of where you are currently offering value, and what you can do to address those needs.

Social Value Model Type Matrix

Additional Information

The model provides greater clarity as to what procurers should be asking for in terms of social value. The Social Value Model Quick Reference Table gives clear guidance to procurers as to which questions they should ask, what criteria they should use to score them, and guidance for evaluators and tenderers about what types of activities can be included and how to measure and report on them. If you’re putting together a social value response on a tender, having this table to hand is going to be invaluable.

Key Takeaways

Both the green paper and this new model emphasise that social value isn’t going away; in fact, it’s going to become a more important part of public procurement going forward. The government wants to use its purchasing power to get the best value for money and to create the most difference in local communities. We would expect to see this guidance starting to be used by other publicly funded organisations and would suggest that all businesses start to think of their social value in terms of the three different types and the five themes to help them bring together successful social value responses going forward.

We know from talking to small business owners that social value is a subject that some struggle with. If that’s you, we can help! We’ve worked with businesses of all sizes to help them understand the social value legislation as it applies to their business and develop responses that stand out and win them business while delivering great value into local communities. If we can help you with that too, get in touch today.

Adrian Corcoran

Adrian Corcoran is Managing Director and Founder of Bid for Success. Passionate about working with great businesses to win them new work, she and the Bid for Success team are here to help you with your bidding and work winning needs.

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