With the Public Services (Social Value) Act about to become law in England, why are public services taking so long to factor social value into service design? This presentation looks at the policy context and some of the pitfalls.

1. Social value from the start
Is anything stopping us procuring better services?

2. The spirit of the Act

3. Social value asks the question: 'If
£1 is spent on the delivery of
services, can that same £1 be used
to also produce a wider benefit to
the community?'

4. 'The regulatory regime is not as inflexible from a
commercial perspective as is commonly made out...
More often that not, restrictions arise because those
who interpret the rules in central government adopt
an overly restrictive approach...'
(Evidence to all party parliamentary group on
outsourcing)

5. UK policy context
How social value is becoming
part of the conversation across
government

6. 2010 NAO and Audit Commission report
on collaborative procurement
Potential: Value of procurement spend was £220bn in 2008/09
2,500 OJEU exercises could have been avoided by using
Waste: framework agreements
'The public sector procurement landscape is
Muddle: fragmented, with no overall governance...'

7. 2010 Modernising Commissioning green
paper
New roles for social enterprises, charities and public
Change: service mutuals
Aspiration: Intelligent savings, more responsive services
'The expenditure of public money does not always
Challenge: deliver optimum value...'

8. In "Our Programme for Government" the coalition
government made a commitment to 'support the
creation and expansion of mutuals, co-operatives,
charities and social enterprises, and enable these
groups to have much greater involvement in the
running of public services.'
(Modernising Commissioning green paper)

9. 2011 Localism Act
'General power of competence' allows local authorities
Power: to do anything that is within the power of an ordinary
citizen
Community budgets should enable new, localised
Devolution: approaches to commissioning
New community rights include the right to bid to run
Rights: public services - an opportunity to add social value?

10. 2011 Treasury Green Book updated
Annex 2 describes ways of valuing non-market goods,
Tools: including time and environmental benefits
'Material costs and benefits that cannot be valued in
Benefits: monetary terms should clearly be taken into account...'
2012 guidance on accounting for environmental
Holistic: impacts introduces concept of 'total economic value'

11. 'The full value of goods such as health, educational
success, family and community stability, and
environmental assets cannot simply be inferred
from market prices, but we should not neglect such
important social impacts in policy making.'
(HM Treasury Green Book, annex 2)

12. 2011 Open Public Services white paper
Categorises services as individual, neighbourhood or
Taxonomy: commissioned services
White Paper sets out five guiding principles: choice,
Principles: decentralisation, diversity, fairness, accountability
Although it claims funding will be targeted at the most
Caveat: disadvantaged, cost savings and 'productivity' are the
overriding agendas

13. 2011 Best Value statutory guidance
'Councils should consider overall value – including
Social value: social value – when considering service provision.'
Previous guidance is being scrapped, including
'Creating strong, safe and prosperous communities',
Scrapped: duty to involve and duty to prepare a sustainable
communities strategy
Summarised as 'economy, efficiency and effectiveness' -
Duties: but social value and consultation are central

14. 2012 Public Services (Social Value) Act
Imminent: Act becomes law in January 2013
Covers English organisations (and some in Wales) but
Limits: limited to services, not goods or works
Requires commissioners to 'consider' social value when
Duties: specifying or tendering services

15. Conflicting signals

16. Do commissioners have the capacity?
'A lack of expertise is already harming the sector's
Unskilled? ability to manage contracts' (All party parliamentary
group on outsourcing)
Many procurement staff are relatively junior, and more
Unfamiliar? familiar with accounting than with service design
'Commissioners don’t always have the skills - or the
freedom - to work with VCS organisations to explore,
Afraid? identify needs and shape the market. They can be
scared of giving out the wrong messages.' (Locality)

17. Do commissioners have the will?
2010: 57% of bassac members said commissioning was
Low priority: very or fairly ineffective
'Unfortunately most statutory duties are reactive,
Firefighting: expensive, short-term and do not allow individual or
community influence.' (Locality)
High profile legal challenges such as Virgin West Coast's
Risk averse: against the Department for Transport may militate
against innovation

18. Has social value been over-hyped?
There is no overriding legal duty that forces
Not magic: commissioners to specify social value outcomes in
tenders if they don't want to
Social enterprises and voluntary organisations will still
be disadvantaged compared with bigger and better
Not equal: resourced providers, who may be able to game the
system
'This new legislation, like any other, will not solve
anything without a culture change that comes from
Key issue: both commissioners and providers' (Local Government
Information Unit)

19. Making it happen

20. Where there's a will, there's a way
Five local development trusts have worked together to
Doncaster: develop a common offer and approach to service
providers
City council is looking to include measures of social
Liverpool: value into procurement, including gap between
providers' highest and lowest earners
Northern Ireland Housing Executive is considering
N Ireland: reorganising its functions to enable it to contract with
social enterprises

21. Advice for commissioners from Social
Enterprise UK
Ask yourself what social value means to you, and to the
Think: community you serve
Develop a policy for commissioning for social value, and
Plan: work out how this can be translated into tenders
Assign weightings to reflect social value priorities, and
Measure: monitor performance accordingly

22. Advice for providers from Social
Enterprise UK
Ask yourself what social value you offer, and make sure
Think: service commissioners know about it
Put your own methods of measuring social value in
Measure: place so you can demonstrate what you offer
Make sure you also offer value for money and can meet
Check: commissioners' other essential requirements

23. From contracting to co-production
Community organisations working directly with service
Co-design: commissioners to design and develop services that
involve their communities and meet their needs
'Find something that shows they can save money and
Mutuality: they’re going to queue up. That’s what it’s all about at
the moment.' - Routeways, Plymouth
Lambeth's 'co-operative council' model will involve
Involvement: citizens in drawing up service specifications

24. 'Co-production means delivering public services in an
equal and reciprocal relationship between professionals,
people using services, their families and their
neighbours. Where activities are co-produced in this
way, both services and neighbourhoods become far
more effective agents of change'
(New Economics Foundation/ NESTA)

25. Three key questions to ask:
Are service design, procurement processes and local
Coordinated: needs aligned?
Who holds the purse strings and what are their
Control: priorities?
Commission: Who is involved in specifying the service and why?

26. Help and advice!
A few organisations that can
help you with the detail...

27. Information and expertise
New economics foundation - important thinking on service
Nef design and co-production - http://www.neweconomics.org/
Association of Public Service Excellence -
APSE http://www.apse.org.uk/
CLES Centre for Local Economic Strategies - http://www.cles.org.uk/
Social Trade association for social enterprises:
Enterprise UK http://www.socialenterprise.org.uk/
Represents development trusts and 'community anchor'
Locality organisations - http://locality.org.uk/
Social Return on Investment Network - developing tools to
SROI Network measure social value - http://www.thesroinetwork.org/

28. 'Not everything that can be counted
counts, and not everything that counts can
be counted'
Albert Einstein [attrib.]

29. thank you
more from me...
www.urbanpollinators.co.uk
my blog: Living with Rats
Twitter: @juliandobson