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Procurements are not just about cost and quality. It’s also about the social and environmental impact of those choices. But what is social value in procurement and how does it effect our decisions?
Procurement Act 2023
The Act will continue to home in that buyers need to consider not just economic factors. They also need to consider social and environmental benefits too. This means the term Most Economically Advantageous Tender (MEAT) will become Most Advantageous Tender (MAT) for inclusivity of social and environmental factors. The aim is to encourage more buyers to adopt greener procurement policies and practices, and to assess the social value performance of bidders.
It will promote more participation and competition from small and medium-sized enterprises (SMEs), start-ups and social enterprises. These types of suppliers tend to have a lower environmental impact and a higher social value than large organisations. An increase in these smaller suppliers will improve diversity and quality of the supply market and create more opportunities for green bidders to win public contracts.
Discover the key changes in our brief overview of the Procurement Act 2023.
At the heart of social value lies its impact. It affects society, the environment and the economy. It’s about going beyond the usual cost and quality metrics. It’s considering broader outcomes that help communities and the world. Yet, integrating social value into procurement isn’t a straightforward task. It requires careful planning.
One of the critical junctures in the procurement process is the planning phase. Here, the focus extends beyond mere desired outcomes. What outcomes do people expect? How do these outcomes align with broader societal goals? The process progresses, bringing the social value element into sharper focus. The contrast is between impact on social value and impact on public procurement. It urges stakeholders to tread carefully.
Historically, procurements tended to use a one-size-fits-all approach to add social value. Today, there’s a paradigm shift towards more nuanced approaches. Weightings for social value are rising. Councils and organisations are allocating higher percentages. It’s becoming a key factor in procurement.
Common challenges around Social Value and Procurement
But, amid the push for higher social value weightings, a key question arises. How do we ensure a fair and clear evaluation process? Herein lies the crux of the matter. It’s not just about allocating percentages. It’s about creating a strong framework. The framework evaluates social value contributions, the line between quantitative and qualitative assessments is crucial. It ensures a full evaluation that captures both tangible metrics and qualitative assurances.
Social value assessments entail a careful mapping of outcomes and measures. Rigorous methods assign each one a tangible value. The assessments use a wealth of data and expertise, and they result in a quantifiable measure of social impact. The shift is to prove and explain, it’s about how social value commitments will be upheld. It’s about more than numbers; it’s about demonstrating intent and capability.
Organisations are now embedding social value into their procurement processes. But they must take a tailored approach to get the right outcome. There’s no one-size-fits-all solution. Each procurement needs a bespoke strategy and it must align with their project’s objectives.
For a deeper dive into Social Value, download our white paper, Social Value in Public Procurement – Not in Isolation.
Social Value Training
We run a half-day course for those who need to understand what Social Value is and how to apply it to a procurement. It considers Social Value in the context of public sector procurement, the process that should be followed and how to apply it to your project.
The course is for procurement team members responsible for delivering the Social Value elements of a procurement, project members who wish to gain an understanding of Social Value considerations or bidders who wish to understand what the buyer is looking for.
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