Procurement and social value

OECD countries spend a total of 12% of their collective GDP on public procurement. The UK government spends even more: 15% of the country’s GDP. Given its sheer size, public procurement has huge potential to impact on government’s ability to improve social outcomes. Some procurement spend directly attempts to improve social outcomes, through the outsourcing of human services like health and social care. Other government purchasing, from roads and bridges to pens, has traditionally adopted a narrow focus on buying the best product for the cheapest price, but governments are increasingly seeking to leverage their broader procurement to advance their social objectives, through the use of social value requirements.

Alongside other leading academics from the Universities of Stirling, Northumbria and Cardiff, we have recently embarked on a large study into how the annual £100bn UK local government procurement spend is being dispensed during the pandemic, and how lessons from the response can inform recovery efforts. This has been funded by the Economic and Social Research Council (ESRC) as part of the UK Research and Innovation (UKRI) rapid response to COVID-19.

Our Oxford Procurement of Government Outcomes (POGO) Club established a set of working groups, focused on producing tangible outputs. These have already led to a response to the UK Government’s Green Paper on “transforming public procurement” following the country’s exit from the EU. Other groups continue to work on drafting impact bond contract templates and bringing together a dataset on social value procurement.

We are currently scoping an emerging project related to social value, which will explore questions of democracy, expertise, and the effects of such practices on the supply chain or service delivery systems, including the promises related to VCSEs, small and medium enterprises, and local places.