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Manchester’s ‘social value’ procurement boosts local economy

Manchester City Council spends 71% of its procurement spending with local companies, according to new research.

The analysis by the Centre for Local Economic Strategies (CLES) revealed that in 2016-17 the council spent around £320m on goods and services from Manchester businesses.

This figure was just over 50% a decade ago. The council has been working with CLES for over 10 years to improve its procurement policy and practice, aiming to address local needs and maximise benefits to the city’s residents.

Over this time, the council says that it has been “pioneering in embedding ‘social value’ into all aspects of its procurement cycle,” and has established a minimum 20% social value weighting for all procurements.

As well as the direct economic benefits, the study found that in 2016-17 the top 300 suppliers to Manchester City Council created almost 70,000 hours volunteering and community sector support activities.

They also created an estimated 705 apprenticeships in the city, and over 1,000 jobs, including 423 employment opportunities for “hard to reach” individuals.

Almost three quarters of responding suppliers paid their staff an hourly rate in excess of that advocated by the National Living Wage Foundation.

The study’s findings were revealed at the Power of Procurement 2018 event in Manchester, held to reflect the progress made in Greater Manchester around embedding social value into progressive procurement activities.

Cllr Carl Ollerhead, chair of Manchester City Council’s ethical procurement subgroup, said: “These new findings demonstrate that we are leading the way in ensuring that our procurement provides the maximum possible benefit for Manchester people - creating new local jobs and economic activity and increasing engagement with community initiatives by local businesses, while also delivering the best possible value for the city.  

“Through a long-term commitment to studying and improving our procurement policy and processes, we’re now working more closely and productively than ever before with Manchester businesses, significantly boosting the local economy as a result.”

Matthew Jackson, chief executive of CLES, added: “CLES has been pleased to work collaboratively with Manchester City Council over the last 10 years to progress their procurement process. 

“Our objectives have always been to understand where procurement spend goes, shift the behaviour of procurement officers and influence the supply chain; all for the benefit of the Manchester economy and its residents.

“We are delighted to see the change which a more progressive approach has enabled in local economic, social and environmental terms.” 

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