Social Value in Public Procurement: A Practical Implementation Guide

Social value has moved from peripheral consideration to central procurement requirement. Since January 2021, central government buyers must evaluate social value in major procurements, and the approach has spread across the wider public sector.

This guide explains social value requirements and how to implement them effectively.

Understanding Social Value

Definition

Social value represents the additional benefit to society generated through procurement choices. Beyond the direct goods or services purchased, social value considers wider impacts on communities, employment, and sustainability.

Legal Basis

The Public Services (Social Value) Act 2012 requires public bodies to consider how procurement might improve economic, social, and environmental well-being. Procurement Policy Note 06/20 makes social value evaluation mandatory for central government contracts above £5 million.

The Social Value Model

The government's Social Value Model identifies five priority themes. The first theme, COVID-19 recovery, covers helping communities and organisations recover from pandemic impacts. The second theme tackles inequality by creating opportunities for disadvantaged groups and underrepresented sectors. Fighting climate change, the third theme, supports transition to net zero through procurement choices. Equal opportunity, the fourth theme, advances fair treatment and removes barriers to participation. The fifth theme focuses on wellbeing by supporting health and community cohesion.

Implementing Social Value

Setting Evaluation Weightings

PPN 06/20 requires social value to be explicitly evaluated, with a minimum 10% weighting. Many authorities allocate higher percentages for contracts with significant community impact.

Designing Social Value Questions

Effective questions link social value to contract delivery, request specific and measurable commitments, relate to the buying authority's locality and priorities, and are proportionate to the contract value and nature.

Evaluation Approaches

Commitments require assessment for relevance and local impact, deliverability and realism, measurement and reporting arrangements, and overall social value generated.

Supplier Perspective

Understanding What Buyers Want

Buyers increasingly value employment and skills initiatives including apprenticeships, training programmes, and work placements for disadvantaged groups. They also value local economic impact through spend with local suppliers and support for community organisations. Environmental commitments around carbon reduction, waste minimisation, and sustainable practices matter significantly, along with diversity and inclusion involving supply chain diversity and employment practices.

Building Social Value Capability

Suppliers should audit current social impact activities, establish measurement frameworks, develop relationships with delivery partners, and create reportable evidence of outcomes.

Responding to Social Value Questions

Effective responses are specific to the contract and location, quantify expected outcomes, explain delivery mechanisms, and reference relevant track record.

Measurement and Reporting

National TOMs Framework

The Social Value Portal's TOMs (Themes, Outcomes, Measures) provides standardised metrics for social value measurement. Many buyers specify TOMs reporting, enabling comparison across contracts and suppliers.

Local Measurement Approaches

Some authorities develop bespoke measurement aligned to local priorities. Suppliers should confirm required reporting formats before committing to specific metrics.

Contract Management

Social value commitments become contractual obligations. Buyers should establish monitoring arrangements, evidence requirements, and consequences for non-delivery.

Common Implementation Challenges

Proportionality

Smaller contracts may not warrant extensive social value requirements. Tailor expectations to contract scale and supplier capability.

Verification

Validating social value claims requires clear evidence standards. Define what proof suppliers must provide and how it will be verified.

Avoiding Tokenism

Social value should create genuine benefit, not tick-box compliance. Focus on meaningful outcomes rather than impressive-sounding but shallow commitments.

Balancing Priorities

Social value doesn't replace quality and price considerations. Integration with overall evaluation ensures balanced decision-making.

Emerging Trends

Net Zero Commitments

Climate requirements are increasingly prominent. Many buyers expect carbon reduction plans and science-based targets from significant suppliers.

Modern Slavery

Supply chain due diligence extends beyond direct suppliers. Buyers expect visibility into lower-tier supply chain practices.

Local Wealth Building

Community wealth-building approaches aim to keep economic benefit within local areas through procurement preferences and supplier development.

Conclusion

Social value represents a fundamental shift in procurement philosophy—recognising that public spending can and should generate benefits beyond the immediate purchase.

Successful implementation requires clear requirements, realistic commitments, and robust monitoring. Done well, social value delivers genuine community benefit while supporting effective procurement outcomes.