Challenges that we are facing now, and in the future, such as climate change, poverty, cost of living, health and wellbeing, Covid-19, employment, skills and economic development all bring the social responsibilities of local authorities and other public bodies into the spotlight. Acting locally and collaboratively, these bodies can overcome the ‘public policy impasse’ that has held back attempts to address these deep-seated challenges facing our communities and places.
This brings into sharp focus the way in which these bodies carry out their functions and procure services. Working more closely together, both between themselves and in conjunction with the private sector, they can secure better social, economic, environmental and cultural outcomes, or what has become known as ‘social value’.
The legal and regulatory environment, coupled with use of conceptual frameworks such as doughnut economics, can help councils to rethink the balance between social, economic, and environmental foundations of wellbeing, where intervening through ‘social value’ can make a positive difference to their people, communities and places. Councils are embedding social value and ethical considerations into their organisation, contracts and the deployment of technologies and data.
Purpose of the Briefing
This briefing outlines the opportunities for Digital/IT leaders in local public service organisations and their suppliers to consider social value as a key plank in their strategies, policies and operations.
For digital and IT professionals, social value requires three main areas of focus:
- Procurement – how to ensure social value is reflected in contracts.
- Staffing and skills – how to generate social value through better hiring, learning and skills development.
- Ethical, digital place-making – how to harness technologies and data to understand and to tackle inequalities, health and well-being in a place and to target investment in local digital infrastructure, resilience and capabilities accordingly.
Legal and regulatory frameworks
In England and Wales, social value is defined through the Public Services (Social Value) Act 2012, which requires all public sector organisations and their suppliers, to look beyond the financial cost of a contract to consider how the services they commission and procure can improve the economic, social and environmental wellbeing of an area.
In Wales, the concept of social value has been taken a step further by The Well-being of Future Generations Act 2015. This Act places a legal obligation on public bodies to work to improve the economic, social, environmental and cultural well-being of Wales by following a ‘sustainable development principle’. The principle requires public bodies to consider the long-term impact of their decisions, to work better with people, communities and each other and to focus on preventing persistent problems such as poverty, health inequalities and climate change.
Social value in Scotland forms an important element of the Public Procurement Reform Programme, in which the Scottish Government places procurement “at the heart of Scotland’s economic recovery”. The Procurement Reform (Scotland) Act 2014 requires commissioners to think about their stakeholders before they begin a procurement process, the impact of the services they intend to buy and how they intend to buy them. Public spending is seen as delivering public value, which goes beyond cost and quality in purchasing and rather reflects a model of price versus growth versus sustainability.
In Northern Ireland (NI), Public Procurement Policy Note 01/21 mandates that tenders must allocate a minimum of 10% of the total award criteria to maximising social, economic and environmental benefits.
Social Value – What it really means?
Closely aligned to Public Value – considering the ‘Authorizing (legislative and policy) Environment, Operational Capacity and Outcomes’ – is the concept of social value.
The UK government describes social value as “the positive legacy created through the performance of a contract”. However, there is a growing body of evidence that social value can be secured through a variety of policy instruments operating throughout the supply chain to shape places, not just through procurement contracts.
There are three categories of social value:
- Social (e.g. activities that promote a united community)
- Environmental (e.g. efforts to assist the community in reducing waste or pollution)
- Economic (e.g. training, employment or apprenticeship opportunities for disadvantaged groups)
Considering the issues that local government faces around the adoption of social value and the importance it holds within the wider community, it is important to look at factors that have impacted health and wellbeing, and what can be done to mitigate these factors.
Coming soon after the global Covid-19 pandemic, the cost-of-living crisis (see Figure 1) is probably the biggest issue that faces the UK in terms of welfare today. It could be argued it could also be viewed as a public health crisis due to the struggle to pay for certain necessities such as rent, food, heating, transport, health and physical well-being.
Exacerbating the public health issue is the ongoing crisis in the NHS. Squeezing pressure on the NHS in terms of funding and other goals such as net zero has implications for public health, such as increasing allergens, air pollution, environmental degradation etc.
Key elements of social value that can be embedded throughout local communities to address many of these challenges include:
- changing the norm of social value being an optional extra to one that is embedded in organisations in a meaningful way
- focusing externally rather than just internally
- embedding social value in the community into contracts
- integrating social value into the core of public sector organisations and their supply chains.
- considering the requirements of their place and thinking about the wider social, environmental, and economic impact of everything that the public sector does.
Harnessing social value can play a key role in addressing these challenges through place-making and people centered services. Better use of technologies and data, curating resources, and addressing complex problems of ethical change are important enablers, requiring:
- Reset: Ethical principles, respecting social economic and ecological foundations
- Reform: Public services by embracing innovation and modernization
- Renew: Communities by collaborating across place and encouraging self-sufficiency
- Resilient: to disruptive changes, to thrive and to achieve better, sustainable and inclusive outcomes for everyone.
Securing ethical use of technologies and data is also at the front of social value considerations to avoid issues with data breaches and data protection. Key principles identified in Socitm’s work on Digital Ethics include:
- Beneficence: The benefits should outweigh the potential risks and benefit the individuals in the community.
- Non-maleficence: To avoid harm, including harm from malicious or unexpected uses, by recognizing that the moral quality of a technology depends on its consequences. Conditional risks and benefits must therefore be weighed to avoid potential harm.
- Autonomy: A community should be self-governing and therefore free to make their own choices, this puts control back into the people. This involves making sure people have sufficient knowledge and understanding to decide on how technologies and data are deployed and used.
- Justice: each person should be treated equally and fairly, which is at the very core of social value.
- Explicability: This relates directly to how emerging technologies, such as artificial intelligence, and data are designed and used. Algorithms should be transparent; their use should be explicable in order that solutions and approaches can be trusted.
The demand for data is substantial due to its value when turned into useful, actionable insights. Its use in contributing to knowledge and innovation through communities can be life-changing for many individuals, for example by reducing hardship from poorly targeted services. In harnessing data, there will be ethical – informed, explicit and justifiable – tradeoffs for different scenarios, rather than following a prescribed set of rules.
Emerging technologies such as Artificial Intellgence, 5G, autonomous vehicles, etc. are already raising questions about their impact on the wider community and how far they increase social value without losing meaningful human control.
Frameworks and toolkits
Social Value Statement
In order to enable councils to outline key areas of focus, operational procedures, successes and resources available, the Local Government Association’s National Social Value Taskforce has developed a Social Value Statement template which can be used to communicate key messages and secure support from staff, partners, suppliers and other locally based organisations to help create social value benefits for your community. There are nine suggested sections included in the statement:
- Approach and intentions in relation to social value
- Key areas of focus
- Internal engagement, communication and management of social value
- Implementation approach for embedding social value.
- Internal support available to achieve targets and ambitions.
- Collaboration, external engagement and support available to partners that want to contribute to creating place based social value.
- Performance Management
- Achievements and benefits realisation
- Actions and next steps for delivery.
Through a partnership with the Social Value Portal the LGA has developed a set of Themes, Outcomes and Measures (TOMs) to help councils measure the value they are achieving through implementing the Social Value Act. The National TOMs Framework has been designed around 5 principal issues, 20 Core Outcomes and 48 Core Measures:
- Themes – The overarching strategic themes that an organisation is looking to pursue.
- Outcomes – The objectives or goals that an organisation is looking to achieve that will contribute to the Theme.
- Measures – The measures that can be used to assess whether these Outcomes have been achieved. For the National TOMs Framework, these re action based and represent activities that a supplier could complete to support a particular desired outcome.
Social Value Toolkit (Northern Ireland)
Sustainable NI has created a Social Value Toolkit to help councils and public sector organisations to maximise the benefits of social value through supplier contracts by providing:
- guidance on typical governance requirements during procurement and commissioning processes
- examples of social value outcomes that could be identified for use in contracts.
- examples of indicators to measure and track the progress of social value delivered through contracts.
- example questions to ask during the tender stage so that suppliers can illustrate what they will deliver through the proposed contract(s) to achieve social value.
- case studies to demonstrate examples of how social value has been achieved through contract delivery.
Doughnut Economics provides a foundation for a technological and ethical approach to determine the needs of the communities in addressing twin challenges of a good standard of living while living within environmental limits. It is a framework that inspires environmental sustainability and ensures that there is a social floor that no one should fall below.
Doughnut economics proposes a new vision for the economy (See Figure 2). The outer circle represents the ecological ceiling or planetary boundaries, while the inner circle reflects the social foundation or measures of human wellbeing. The space in-between is where we seek to meet the needs of all people without overshooting earth’s limits.
Instead of a single economic indicator, the doughnut consists of a dashboard of indicators that define its components.
Effectively, it serves as a compass for human progress and flexibility regarding how social, economic, and environmental priorities can be met. The goal of this framework is to enable society to make positive choices; to live in balance so that communities can thrive – economically, socially, and environmentally.
The tech doughnut aims to understand the contributions that digital – technologies and data – can make to:
- exploring a broad definition of sustainability
- looking deeper into the root causes of what’s going wrong
- imagining a better future for the technology industry.
Social Progress Index
The aim of the ‘Social Progress Index’ is to enable community development through intelligent action rooted in an evidence-base. Bringing together a rich variety of datasets – metrics, include health, noise and air pollution, rates of exercise and obesity, recycling and domestic violence, new insights are generated into the principal components of diverse social ecologies – relationships and root causes of persistent problems that undermine basic human needs, the foundations of wellbeing and access to opportunities.
Social value in action
Procurement and supply chains
Norfolk County Council
Outcomes that are built into large IT Contracts in Norfolk include:
- digital skills
- practical use of IoT (Internet of Things)
- digital inclusion
- support for care leavers – offering guaranteed interviews for roles in the vendor’s company where appropriate.
- local employment opportunities (even if the supplier is national or global).
The aim is to add sustainability elements which might also overlap with social value and thus grow in prominence over the coming months and years.
Liverpool City Council
In Liverpool, the TOMS framework is applied as a part of the procurement requests to deliver social value. Pointers to take from the Liverpool City Council are:
- application of the TOMS Framework
- harnessing volunteer hours with community
- other considerations, such as ethical supply chains.
Liverpool has been encouraging companies to use any company volunteer hours with their communities, which has shown some success. They also believe that there is much more to be done to encourage suppliers to build ethical supply chains and to offer extended ICT equipment lifecycles.
Staffing and skills
London Borough of Hounslow
The London Borough of Hounslow (LBH) sees its ‘Digital & IT’ activity as much more than just hardware and software. Rather, it acts as a genuine contributor to their local communities, enabling creation of new jobs and development of skills where they are needed in the local area.
LBH uses the term ‘VALUE’ as an acronym which is broken down in to Volunteering, Apprenticeships, Learning and Development, Uptake and Employment, providing a way to record social value commitments and show the outcomes achieved.
The VALUE measuring index is described in more detail in this video:
Ethical, digital place-making
Regen Melbourne: an evolving journey. The origins of Regen Melbourne were born in October 2020, as a small community got together to imagine a different future for the city using Doughnut Economics. From there, we’ve grown through three phases, this piece captures some of that story.
Leeds Doughnut: one year on from launch. On 28th April 2022, Climate Action Leeds ran a ‘Launch of the Leeds Doughnut’ event to introduce the Doughnut Economics model and gather people’s thoughts on how they could use Doughnut Economics in their work and everyday life. The Leeds Doughnut City Portrait is the first step towards creating a city plan that will create a zero carbon, nature friendly, socially just Leeds by the 2030s.
Social Progress Index
London Borough of Barking & Dagenham developed the first Social Progress Index (SPI) at ward level allowing them to understand the social wellbeing of their residents. Through data-driven insights the Social Progress Index has enabled the borough to tackle issues that include domestic violence, homelessness and fuel poverty.
Lichfield District Council, through a partnership with Social Progress Imperative, has developed a District Social Progress Index. The index explores the social wellbeing of residents at ward level. It will help the Council, its partners, residents and businesses better understand wellbeing across different parts of the district. The SPI is made up of three parts: Basic Human Needs, Foundations of Wellbeing and Opportunity. Within each of these there are then a number of different topics and indicators. The scores for each topic and indicator are shown on a scale from 0-100.
Lambeth and Southwark boroughs created a set of metrics to assess the social progress of their residents. The Urban Health Index provides information on 68 neighbourhoods in Lambeth and Southwark captured in 42 indicators relating to basic human needs, foundations of wellbeing and opportunity.
Integrated Care Systems (England)
Over the past few years with the Covid-19 pandemic causing issues throughout the health care system, lessons had been learnt surrounding the value of local councils, the NHS, voluntary and community organisations working together to provide joined up care and support. Currently across England there are 42 integrated care systems (see Figure 3) whose aim is to deliver the support where needed. Partners are joining up budgets, so they can invest in specific needs, these ICS’s also deliver personalised care and closer coordination of services. The integrated care systems will have to adapt and change over the coming years, due to an ever-changing landscape and an ageing population the ICS’s will have to be as strong as they can be in every part of England.
A recent case study (April 6, 2023) from North East and North Cumbria sets out to put peoples ‘lived experience’ at the centre of the ICSs involvement and engagement strategy. Due to the new arrangements for integrated care, it was expected that communities were to be at the heart of all decision making. The study found strengths and pitfalls which show the need for ICSs to constantly develop and listen to feedback that will help instill continual involvement and engagement embedded in commissioning and leading to changes in services for the better.
There are also opportunities for ICSs to rethink and co-create services, enable independent living, harness technologies and data. For example, the certain rise in AI, assistive tech, mobile and connected workforce.
Social Value – aspects for suppliers to consider
Social value, Corporate Social Responsibility (CSR) and Environmental Social Governance (ESG) go hand in hand.
Social value and CSR both focus on making a difference to communities and the environment (see Figure 4). However, there are key differences and purposes which have an important impact on how a business can report on and quantify the difference it makes.
Considerations for suppliers include:
- Social and environmental responsibility – empowering employees to give back to their communities and environment.
- Physical and mental wellbeing – actively support employees and their families.
- Environmental footprint – Hybrid working, working with clients to reduce need to travel, raising awareness amongst employees, cutting out single-use plastics, reusing and recycling IT equipment, encouraging reduction in meat consumption.
- Localisation in delivering assignments – recruiting consultants and external support locally, ensuring reflection of local diversity, local living wage.
- Future consultant programme – training and development, apprenticeships on live projects, mentoring and coaching leading to permanent jobs at conclusion.
- Diversity and inclusivity – embedded in resourcing, attraction and talent development, equal pay, gender-balanced workforce and leadership, disability confidence.
- Systems – Online free to use training resource (Udemy), low-touch HR systems, employee assistance programme.
Social value presents an opportunity for digital & IT leaders in public sector organisations and their suppliers to consider the wider implications of their investments, resources, products and services.
The following agendas all offer opportunities to embed social value:
- Ethical supply chains for IT hardware
- Green Agenda
- Digital inclusion
- Climate Emergency
- Emerging technology
This briefing outlines three main areas of focus on social value and offers illustrative examples for digital & IT leaders in public sector organisations and their suppliers in the following areas:
- Staffing and skills.
- Ethical, digital place-making.
Social value is more than just about looking inwards, it extends to creating tangible improvements in our communities and providing a positive outlook for staff wellbeing and retention.
- Social Value UK (socialvalueuk.org)
- Guide to using the Social Value Model – Government Commercial Function (gov.uk)
- Social Value Lab (socialvaluelab.org.uk)
- Social Value – Achieving community benefits (local.gov.uk)
- Northern Ireland:Scoring Social Value for public bodies (socialvalueni.org)