Social Value Bill becomes law
A Bill requiring English and some Welsh public bodies to consider social, economic and environmental wellbeing in their procurement policies has received Royal Assent.
The Public Services (Social Value) Act requires local authorities and other public bodies to look at the social value of competing tenders as well as best price when awarding contracts. It is hoped that this will help social enterprises and charities to compete more fairly with larger firms for public sector contracts.
The Bill has a limited scope in Wales as Welsh public bodies that exercise wholly or mainly devolved functions are excluded from its remit. However, Welsh Social Enterprise Coalition Chief Executive, John Bennett, said that social enterprises in Wales should welcome the news.
He said “Whilst its application in Wales is limited, the passing of the Public Services Bill is certainly a step in the right direction. Across the UK, many social enterprises have been overlooked when bidding for public sector contracts but this legislation means that the added value social enterprises offer, in terms of the social impact they have, will be recognised in the tendering process.”
As businesses that exist primarily for a social or environmental purpose, social enterprises are well positioned to offer the best overall value when awarding contracts. Profits are pumped back into the community and into its social mission rather than concentrated in the hands of shareholders or owners.
Whilst a number of local authorities in Wales already factor in community benefit into the tendering system, many don’t. Progress is being made through a series of initiatives including the Welsh Government’s community benefits approach, which has been used in over £3 billion worth of projects across Wales, helping to sustain and create jobs and generate other opportunities for local communities.
Policies to increase the numbers of contracts being awarded to Welsh companies, widening the advertisement of lower value contracts and the simplification of the pre-qualification process (PQQ) are helping to break down the barriers to public contracts for Welsh social enterprises but there is still a lot more to do.
John Bennett added: “The public sector in Wales spends over £5 billion a year on goods and services and if we truly want to make procurement work for the Welsh economy and our communities, we need to ensure that it delivers significant social as well as economic benefits.”