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Social value: A fresh way of approaching investment

In an age of austerity, council leaders are always looking to squeeze everything they can from finite budgets. Trafford Council CEO Theresa Grant explains to PSE’s Josh Mines how social value can offer local authorities an innovative new way to deliver services. 

Social value is a simple concept that is transforming the landscape of local government. As Trafford Council’s chief executive Theresa Grant explained to me, social value is the extra benefit for the community that councils can add by making simple changes to their procurement activities. 

“If you’re going to procure or purchase, it’s the added value you can get over and above what you would normally derive from intelligent procurement,” Grant said.

In Trafford, social value is already at work and making a crucial difference to the delivery of council services.

A recent scheme has allowed inmates in Salford’s Forest Bank Prison to gain an NVQ qualification in recycling by participating in work they would normally do anyway – giving the double benefit of upskilling prisoners whilst also offering them a route into work once they are released – thus adding value to the contract and giving something back to the community.

The importance of extending investment into the community

In Grant’s words, social value is about much more than making authorities more efficient.

“It’s about the extended investment in the community, and that can only come through the social value because once you do a transaction it nearly always relates just to the specifics,” she explained.

Embedding social value into council processes shouldn’t be seen as hard work, but rather a small change that could drive huge added benefits in the future.

In just a few weeks, Grant will talk at the National Social Value conference, and she told me her message to delegates will be simple: social value can have a huge impact with “just a little bit of effort” from local government leaders.

“A lot of organisations that you will contract with will be keen to add that social value; it’s just that they don’t have the tools or mechanisms to do it normally,” she continued.

“So my speech will be about how to do that, why we do that, and realising that actually, it’s a two-way process that helps the organisations we are working with as well.”

But how do local authorities work in practice to set the process of social value in motion? Well, as Grant stated, “it isn’t rocket science.”

“It can be done easily,” she said. “You can set up a strategy or a framework and apply it to almost any contract. The outcomes will be different, but the principles will be the same. And it’s getting that commitment at the top level of the organisation to believe and understand that this can add so much value and is a completely fresh way of looking at investment.”

Greater Manchester: at the forefront

Greater Manchester stands as a great example of how councils are working together under the combined authority to collaborate and drive social value forward. As well as the scheme for prisoners, apprentices in the area have benefitted through social value, which has opened up new opportunities within the supply chain for them.

“It’s not also just about engaging directly with the contractor or purchaser, it’s with the whole supply chain,” Grant told me. “That has had a big impact and had a knock-on effect across the board.

“It’s about giving those young people opportunities that wouldn’t have come about if it wasn’t for that social value drive, and I would encourage the rest of the country to follow suit.”

This has been made possible through the implementation of collective frameworks shared by councils in Greater Manchester, Grant added.

“There’s a national board and we’re involved in that, and Hazel Blears is doing some great work around this area as well,” she continued. “I don’t want to reinvent the wheel and tell the rest of the country what to do, but if you want to see how to get on the ladder if you’re not already doing so, we would be more than happy to share our experiences.”

How devolution is backing the social value agenda

Greater Manchester’s journey so far shows just how crucial the devolution agenda is to  social value success. Devolved authorities have allowed councils to adopt a place-based approach to procurement and services – which is a key component to effective social value.

“In Greater Manchester, we have devolution of skills, strong public sector reform which is chaired by the mayor, and all of the activities within that provide opportunities for social value investment,” Grant explained.

“As we get more and more devolved powers it gives us control at a local level where investment is made, and allows us to engage with wider stakeholders in those areas through social value. 

“Because we have more local control through devolution, we are less constrained by national policy. It opens up opportunities that allow us to do things differently, which is what social value is all about.”

An important argument that Grant made is that social value should be seen as “common sense” by councils in England.

“It’s about looking up what I deem to be common sense and applying it to what has in the past been very structured procurement processes that don’t allow you any flexibility,” she went on.

“Social value is the flexible bit, and devolution brings that underpinning flex to allow us to apply social value in a way we wouldn’t have otherwise.”

A separate point that Grant brought up to conclude our conversation is that social value should be seen as something that supports all council activities in the community, and not just procurement.

“Social value is for everybody, it’s not just about procurement,” she asserted.

“If you think about the wider activities of a local authority and their partners within any borough, they have opportunities to apply the social value principles every day in all their activities. It should not be seen as a procurement activity – it’s not.

“Every deal that you do within a local authority, every negotiation you have, should involve some social value aspect to it.”

There’s so many reasons for local authorities to adopt social value into their processes, and so few reasons not to.

In the modern landscape of local government, social value offers a real and very easy solution to delivering services effectively, and getting as much added benefit from that process as possible.

Top Image: ASKhanPhotography