Creating real value | Local Government Chronicle (LGC)

A new model of “social procurement” would add new commitments to collaboration, social value, sustainability, probity and higher labor standards, writes Jonathan Werran, CEO of Localis.

For many who are waiting to cross the 2021 finish line, the news that the devo ball has been tossed into the longer grass of January 2022 brings a sigh of relief. We can catch up with all that refreshed big screen strategy stuff from the Christmas holidays. Hooray.

However, on Monday a fairly important statement by Cabinet Office Secretary Stephen Barclay went slightly under most people’s radar on government procurement reforms.

Under the new rules governing how the public sector purchases £ 300bn worth of goods and services from commercial suppliers each year, companies with a poor delivery or ethical track record will be barred from winning contracts in the public sector. As a Brexit dividend, EU rules will be removed in favor of simpler and more flexible sourcing to make it easier for small businesses across the country to earn their piece of the pie. And, with a nod to the ubiquitous upgrade agenda, the creation of new jobs and businesses will be a deciding factor in purchasing decisions.

It is in this context, and in the historic setting of Churchill’s War Rooms in the heart of Whitehall, that Localis this week launched its report examining the local issues of these national reforms.

Our study, True Value: Towards an ethical public service order, is based on a year of analysis of the territorial impact of the transformation of public markets through three prisms, those of transparency and accountability, ethics and local economic values ​​and benefits – or ‘.

The good news is that if fleshed out with local nuances and accompanied by appropriate resources, these public procurement reforms have the potential to accelerate a shift towards strategic public procurement within local government. However, this strategic change will not be achievable without special attention to training, staffing and supporting the procurement function of local authorities. And the proposed reforms appear to pay little attention to how councils, as democratically elected bodies, use public procurement to meet community needs.

Next year, we will celebrate the full 10 years of the Social Value Act – whose provisions to mainstream the consideration of environmental, economic and social benefits into public sector spending have taken root in local authorities. Over the past decade, councils have connected small and large vendors, social enterprises, anchor institutions and community groups to deliver social value.

But now is the time to take advantage of this positive momentum and pursue a new model of “social procurement”. A model that builds around and deepens existing ethical principles and new commitments – around things such as collaboration, social value, sustainability, probity and higher labor standards to serve society at long term.

Such a model would integrate social procurement as an activity focused on the benefit of local communities and would become a new benchmark for all local spending. For its success, such a social sourcing model will require boards to update their sourcing ethics and engage with communities and local stakeholders early on in setting local priorities and strategies.

So what more can local government do to source more strategically? Well, if upgrading is about raising the most ‘left behind’ places, communities, and people to a level worthy of economic, social, and environmental well-being, boards must first identify what is missing. in communities and where it matters most. felt. To increase the local impact of their purchases, the mapping of public expenditure among suppliers will be essential; this will include the geography of spending, subsequent re-spending by vendors, the ethics of their vendors as well as variances in spending by department and function.

Better market consultation and earlier engagement with bidders would help communicate a board’s key messages about its social value priorities and allow suppliers to develop a location-specific social value offering.

As a path to local purchasing reform, Localis has designed a seven point English local charter for ethical purchasing – which consists of good jobs, transparency, good business, understanding local impact, ‘carbon commitments, good training and high standards of practice. .

As we wrote earlier in the year, this might not contain the TNT political interest of the upgrade white paper, but as a practical way to transform virtually and immediately using operational and logistics levers with ease. available, it has been criminally overlooked to date.

Basically, this is not a technocratic exercise in analyzing spending data and contract poker jiggery. It’s about helping communities thrive, nurturing local businesses to grow, and rewarding suppliers who walk as principled agents of change at the expense of unethical suppliers. If it is a complexity, it is there to be managed. Or, taking Churchill from where we launched the report, “intense complexities, intense simplicities emerge.”