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John Tizard: Public service markets and competitive tendering can be the antithesis of social value.

Wednesday April 11th, 2018

The Government has published new guidance on the Social Value Act to help commissioners and policymakers get the most out of the legislation.

John Tizard

John Tizard

The Department for Digital, Culture, Media and Sport (DCMS) has issued the introductory guide, which it claims gives ‘practical advice’ for anyone carrying out duties under the Act for the first time, or who needs a refresher.

Unfortunately, but sadly not surprisingly, this guidance conflates commissioning and procurement and seems to assume that public bodies will always use competitive tendering-based procurement as a means of working with and supporting charities and voluntary and community sector (VCS) organisations.

This is a huge missed opportunity. DCMS – and Government more widely – should be weaning politicians, civil servants, local government officers and others in the public sector off such an approach.

The new guidance recommends an ‘outcomes-based approach’ to commissioning to encourage ‘innovative and cost-effective solutions’ and observes that services are being co-designed with communities and informed by a wide range of potential providers, including small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs) who are often well-placed to know about location or user-centric opportunities.

There is little to disagree with in these few sentences but there is no reason why a strategic commissioning outcome cannot be secured through partnership working with the VCS and using grants rather than complex over-engineered and disproportionate contracts.

Public services should not be about markets, or the language nor the practices of the market. They are about a democratic bond between the state and the community.  It would be good if government were to acknowledge this and rely less on ideological economic competition when seeking to enhance community wellbeing.

When there is a public interest case for doing so, the public sector should engage charities, VCSE groups in delivering public services on its behalf. This should mean the public sector treating these potential suppliers in the same way that it might contract with a multi-national or national provider. The relationship benefits from being different.

Designing services with communities, the VCS and others is commendable and should be the antithesis of a market approach. It is frankly inconsistent with competitive tendering processes. When tenders are let competitively there is real possibility that they will be let to large corporates, large providers from outside the area which have not been engaged in the co-design process.  There is too much evidence of this having happened time and time again.

Often the public sector can secure social value better when it grants funds small charities and VCS groups that have no desire to deliver public services on behalf of the state, but which do wish to provide and are able to offer added value to local communities. At a time of austerity, grants to such groups can augment grant-based partnering between public bodies, particularly local authorities and the VCS to create positive social and environmental outcomes. They can offer incredible value for money and genuinely create community well-being.

DCMS would do well to recognise and promote such approaches in its guidance but sadly it seems hooked on the peg of competitive tendering and procurement.

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