10.07.14
Labour vows to open up procurement contracts to social enterprises
Public service contracts could be ‘reserved’ for social enterprises under plans outlined by Labour, to ensure they are not “locked out” of contracts by the same few big companies.
Chi Onwurah MP, Labour’s shadow minister for social enterprises, told an event hosted by Collaborate and E3M that Labour would utilise new EU procurement rules that will allow government departments and local authorities to reserve the award of some three-year contracts exclusively to organisations “in the pursuit of a public service mission”.
She said: “Public procurement remains a significant and growing concern for many social enterprises who feel locked out.
“Many public service sectors are now dominated by the same big companies. We want to make it easier for not-for-profit, community-focused organisations to win government contracts. And to help drive this, a Labour Government in 2015 will enable departments to offer some contracts exclusively for organisations “in the pursuit of a public service mission.”
The proposals have been welcomed by the Social Economy Alliance, the campaigning umbrella for social enterprise, co-operative and social finance organisations.
Celia Richardson, director of the Social Economy Alliance, said: “Social enterprises and their supporters will be delighted by this announcement. We campaigned long and hard for the new Social Value Act, and for changes to EU rules, so that local, socially-driven organisations can win in public service markets.
“No-one wants to see £10bn a year in taxpayers’ money going to just 20 private businesses. This is not what a 21st-century, balanced economy needs and not what public service users need.
“We are calling for the next government to use its massive buying power in smart ways. Public spending shouldn’t result in oligopolies where only a handful of giant businesses stand a chance of winning contracts.
The Public Services (Social Value) Act 2013 requires all commissioners to consider the social impact of their public service contracts before they start the procurement process.
However, a 2013 Social Enterprise UK survey found that public procurement remains a significant and growing concern for social enterprises, with 34% of respondents citing procurement policy as a principle barrier to their sustainability – up from 25% in 2011.
Tell us what you think – have your say below or email [email protected]