Out-Law / Your Daily Need-To-Know
Companies bidding in public procurement exercises will be assessed by their social value, with the aim of enabling more small businesses and social enterprises to win contracts, the UK government has announced.
In a speech to thinktank Reform on Monday, Cabinet Office minister David Lidington said all major public procurement exercises would have to explicitly evaluate social value where appropriate, rather than just consider it.
Lidington said the government was proposing to implement a requirement for major public contractors to develop ‘living wills’ which would allow contingency plans to be rapidly put into place if needed.
The changes are to be implemented through an amendment to the 2013 Social Value Act, and are intended to make it easier for mutuals, co-operatives and social enterprises bidding to win government contracts.
“We will ensure that contracts are awarded on the basis of more than just value for money - but a company’s values too, so that their actions in society are rightly recognised and rewarded,” Lidington said.
Infrastructure projects expert Victoria Miller of Pinsent Masons, the law firm behind Out-Law.com, said the proposal to make living wills a requirement showed that public and private sectors are aligned in their thinking.
“Most of our private sector clients have been putting in place robust contingency plans following on from Carillion to ensure that they can continue to deliver services to schools, hospitals and other public services in the event that another large-scale supplier goes into insolvency,” Miller said.
The government is also planning to develop proposals for its biggest suppliers to publish data and provide action plans for how they plan to address key social issues and disparities, including ethnic minority representation, gender pay, and modern slavery.
Other measures announced by Lidington in his speech including a proposal to require increased transparency for major contracts by publishing key performance indicators, improved training for government procurers, and enhanced measures to protect suppliers from cyber attacks.
Lidington said it did not matter who delivered a public service as long as that service worked and provided value for money for taxpayers.
The government also recently launched a consultation proposing that businesses hoping to win public sector contracts should have to prove they pay sub-contractors promptly. The consultation closed on 5 June and a response will be published in due course.
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