New public procurement measures announced

Under new measures, businesses seeking to win government work must set out how they will also deliver social value priorities.

Government departments will use the social value model to assess and score suppliers on the wider positive benefits they bring by delivering the contract, meaning that value for money for the taxpayer can be maximised while also building a more resilient and diverse supplier base.

The social value model which departments will assess contracts on includes: supporting coronavirus recovery; tackling economic inequality, including creating new businesses, jobs and skills, as well as increasing supply chain resilience; fighting climate change and reducing waste; and driving equal opportunity, including reducing the disability employment gap and tackling workforce inequality Improving health and well-being and community integration.

The new approach will apply tests that all bidders, irrespective of their size and type, will be capable of meeting and therefore further levels the playing field for the UK’s small businesses, start-ups and voluntary and community sector organisations and social enterprises.

The new measures will come into effect on 1 January 2021.

Cabinet Office Minister Julia Lopez said: "Government has tremendous buying power, spending £49 billion each year on contracts for vital public services. Value to the taxpayer should lie at the heart of our procurement decisions.

"Too often, however, ‘value’ has been narrowly defined by price without taking into account other important factors such as the number of local jobs or apprenticeships a contractor will provide, the care they show the environment in their business practices or the number of SMEs involved in their wider supply chain.

"We want to see a greater variety of companies deliver government contracts, from every corner of our country - not just because that benefits local economies and communities but because it helps diversify our risk, create a more resilient supplier base and deliver some of our critical priorities. If we can use government’s buying power to drive that broader value, the better our chances of levelling up our country and investing in our people as part of our Covid recovery."

Commercial teams in all government departments will also be expected to complete training courses in implementing the new model and how to ensure the maximum social value is derived from each contract.