Achieving Community Benefits through Social Procurement

Dr Nicola Perkins

Social Enterprise Officer

Wales and West Housing

Why Wales & West Housing?

New project to embed the “social” into everything we

procure…

Bring more meaning benefit back

to our communities

Employability

support for

residents

Supporting / growing

social enterprise

Getting more

from our

contractorsOur approaches………

UK procurement is changing…..

Directive 2014/24/EU on Public Procurement

passed in European Parliament on 26th

Feb 2014

More SME friendly procurement practices

… still to be adopted by Wales

Article 46: Division into lots – more manageable  

Article 48: Use of Prior Information Notices – improving tender readiness

Article 67: Award criteria – most economically advantageous tender – inclusion of

social and environmental factors in award

Article 68: Award criteria – life cycle costing – consideration of the financial,

environmental, and social costs accrued by the product or service across the whole of

its life  

Typical Supply Chain:

Procuring Organisation

Sub – contractors (SMEs)

Contracts over £2 million require delivery of “Community Benefits” in a bid to gain

“Maximum value for the Welsh £”. Value Wales (WG) states:

“Community Benefits /Social value should be achieved in all contracts where

such benefits can be realised”

Prime Delivery Company

“Social enterprises are innovative, independent businesses that

exist to deliver a specific social and/or environmental mission.”

Social Enterprise

Create Jobs

Create an

affordable

alternative to an

existing service

Safeguard a

community facility

Improve Health and

Wellbeing of

individuals in the

community

Deliver skills

training for

employment / life

skills

Deliver a service

for the

community

Social Enterprise

Create Jobs

Create an

affordable

alternative to an

existing service

Safeguard a

community facility

Improve Health and

Wellbeing of

individuals in the

community

Deliver skills

training for

employment / life

skills

Delivery of a mission regardless of what activities

they choose to deliver….

Deliver a service

for the

community

Social Enterprise

Create Jobs

Create an

affordable

alternative to an

existing service

Safeguard a

community facility

Improve Health and

Wellbeing of

individuals in the

community

Deliver skills

training for

employment / life

skills

Deliver a service

for the

community

Delivery of a mission regardless of what activities

they choose to deliver….

Delivery of a mission regardless of what they say on

the tin….

Social Enterprise

Create an

affordable

alternative to an

existing service

FURNITURE

RECYCLING

Social Enterprise

Create Jobs

Create an

affordable

alternative to an

existing service

Deliver a service

for the

community

Safeguard a

community facility

Improve Health and

Wellbeing of

individuals in the

community

Deliver skills

training for

employment / life

skills

Delivery of a mission regardless of what they say on

the tin….

Delivery of a mission regardless of what they say on

the tin….

Social Enterprise

Safeguard a

community facility

SOLAR PANELS ON A COMMUNITY HALL

Social Enterprise

Create Jobs

Create an

affordable

alternative to an

existing service

Safeguard a

community facility

Improve Health and

Wellbeing of

individuals in the

community

Deliver skills

training for

employment / life

skills

Delivery of a mission regardless of what they say on

the tin….

Deliver a service

for the

community

Delivery of a mission regardless of what they say on

the tin….

Social Enterprise

Deliver skills

training for

employment / life

skills

Balanced with

sustainable jobs to

make the model work+

CATERINGMANUFACTURING

They exist from identification of a need at community level…

Which (if well managed) makes them responsive to change…

They can grow as big as the market / need allows...

Evolve to deliver a number of different business streams…

Whilst continuing to be mindful to their mission !!

What makes Social Enterprise

different from other SMEs?

Procuring Organisation

Sub – contractors (SMEs)

Prime Delivery Company

Supply Chains & Opportunities for

Social Enterprise:

Where are the opportunities for social enterprise inclusion?

Supply Chains & Opportunities for

Social Enterprise:

Procuring Organisation

Sub – contractors (SMEs)

Prime Delivery Company

SOCIAL ENTERPRISE

e.g. Catering, transport, product provision, use of a community building….

Supply Chains & Opportunities for

Social Enterprise:

Procuring Organisation

Sub – contractors (SMEs)

Prime Delivery Company SOCIAL ENTERPRISE

e.g. Large established social enterprise or a consortia / cooperative (depending on

contract size)

If social care is the primary mission of the enterprise then can apply:

Article 77: Reservation of health and social care contracts to be reserved for

competition by social enterprises… 

Article 20: Reserved Contracts –for sheltered workshops and economic operators

whose main aim is the social and professional integration of disabled or

disadvantaged persons (at least 30% of employees should be disabled or

disadvantaged).

A little bit more

legislation….!

Supply Chains & Opportunities for

Social Enterprise:

Procuring Organisation

Sub – contractors (SMEs)

Prime Delivery Company

SOCIAL ENTERPRISE

e.g. Social enterprise creation as a way of creating jobs & services

Challenges & Opportunities

To find the right organisation to be a delivery partner;

- lack of knowledge of what is around – support agencies can help

- a group that is a good match (geographically) may not necessarily a social

enterprise right now – but could be!

- but if they are a social enterprise, they may not necessarily delivering

the required services right now…. but it may align well with their mission

- be open about the scope of what you want to achieve- ensure they fully

understand the opportunity

for commissioners:

Challenges & Opportunities

Strength in numbers;

- partnership working with other similar organisations

- development of consortia / cooperatives

for social enterprises:

Challenges & Opportunities

To develop a sustainable business model;

- this is where up front / open conversations make the difference

- could a service level agreement with reducing financial contributions from the

commissioner assist the enterprise to develop? (3-5 yrs)

- capital grant for equipment / asset transfer – social enterprises have asset locks

so if they cease to function equipment would need to be used by a similar organisation

for both:

Challenges & Opportunities

A challenge to generate sufficient organisational buy in

- to understand what is trying to be achieved through social enterprise

- to demonstrate the benefit and manage the risks

- to not fall back into procurement behaviours that present barriers for social

enterprises to tender for

- to not be afraid to challenge existing prime contractors to work harder in

their service delivery and seriously consider / or force them to work with social enterprise

within their supply chains

for commissioners:

Community Benefitsfrom utilising an existing social enterprise;

Sustaining /

creating local jobs

Provision of

community led

/focussed services

Better links with the

local community

Stimulation of

local economy

Strengthening /

resilience of local

communities

Community

Regeneration

Future-proofing

services