Social clauses
Survey on social clauses
Background
Social clauses are requirements within contracts or the procurement process
which allow the contract to provide added social value through fulfilling a
particular social aim. For example, a social clause in a public contract
could prioritise the need to train or give jobs to the long-term unemployed
in the community as part of the contracting workforce.
Commissioners are best placed at both the local and national level to
decide how to factor broader social concerns into funding arrangements.
However, they can find it difficult to factor in the role that social
clauses can play, where the clauses should be used in the procurement
cycle, and how they are affected by EU rules on tendering.
Social Clauses Project Board
The Social Clauses Project Board has been established and meets regularly.
Representatives attend from the Office of the Third Sector (OTS), HM
Treasury, the North East Centre of Excellence, Office of Government
Commerce, Social Enterprise Coalition, Department for Commuities and Local
Government, Defra, NCVO and the Improvement and Development Agency for
local government.
The Board agreed that the first phase of the work on social clauses will
focus on the use of social clauses in the waste sector. A wider stakeholder
group and quality assurance group will be created to comment on the trial
stage of the project.
Local Authority Pilots
The Social Clauses Project will be supporting the use of social clauses in
live procurement exercises in four local authorites: Medway, Braintreee
and Leeds. We will be actively involved in providing legal advice and
other support to the local authroities. The procurement rounds will start
in the new year 2008 and the local authorities will be providing feedback,
seeing legal clarity in the wording of clauses, and demonstrating how added
social benefits can be achieved through social clauses.
We will use the lessons from these pilots to determine what the next steps
of the project will be. Many of the respondents to the social clauses
survey felt that further central government guidance on the use of social
clauses was needed, and so the next steps might inlcude the production of
guidance aimed at “myth-busting” the many uncertainties which surround the
use of social clauses.
Survey
The North East Centre of Excellence (NECE) has completed a survey on social
clauses in public procurement contracts on behalf of OTS. The survey sought
views on the use of social clauses, their benefits and barriers to their
use.
The aim of the survey was to learn more about the appropriate use of social
clauses and spread good practice, and to gather experiences, views and
knowledge from a variety of perspectives.
We wanted views on how to overcome barriers to the use of social clauses,
and to work with those who are pioneering the use of social clauses to
learn about their experiences and draw together examples of leading
practices. Responses will inform the next steps – to support a number of
local authority pilots. Further detail on the survey findings is below.
Survey findings
The survey closed on 30 September 2007. Just under 160 respondents answered
the survey and shared their knowledge and experience of using, or not
using, social clauses to provide added social value, where relevant,
through commissioning and public procurement processes to allow for
economic, social or environmental benefit for the wider community.
Respondents came from both the public sector and third sector.
Summary
The survey confirmed our working hypothesis – that there is much interest
in the use of social clauses, and people have found them of value, but
there are many barriers to their use. Respondents confirmed that the
promotion of social clauses, as a tool for commissioners to provide
additional community benefit through informed procurement, was both needed
and would be welcomed.
Use of social clauses
The responses showed that the use of social clauses is mixed in local
authorities. Of the 15 local authorities that responded, 60% said
they were using, or had used, social clauses to some extent. Social
clauses were being used for a variety of outcomes, ranging from enabling
the contract to work within the authority’s wider objectives and corporate
aims such as equalities and employment aims, to creating benefits to the
local supply chain which addresses the local economic impact of public
spend.
Benefits of social clauses
Where social clauses were reported as being used, the level of ‘success’
was mixed. Some respondents felt that, when successfully used, social
clauses can have a significant impact and be very effective in bringing in
added value to contracts. However, some felt that they had not been
used as effectively as they could have been and that they had not been
given as much weighting required in the contract specification to give them
serious consideration.
When asked “what do you consider are the most significant benefits of
social clauses”, purchasers of services stated:
-
reaching and benefiting hard to reach groups or the socially excluded
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providing opportunities for training, employment
-
ensuring equality and
-
helping to deliver on wider priorities
The providers of services felt that the most significant benefits were:
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more effective uses of public monies
-
bringing real added value to contracts beyond simply service delivery and
-
providing better and more appropriate services for individuals
While a number of respondents highlighted the use of social clauses as a
means of supporting third sector organisations, only 45% of the local
authorities using social clauses mentioned this as a reason to use social
clauses.
Barriers to the use of social clauses
Both the providers and purchasers of services identified the same three top
level barriers:
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difficulty in formulating social clauses as core contractual requirements
-
difficulty in measurement either at tender evaluation stage or contract
delivery and
-
lack of legal assurance
Public procurement respondents additionally listed significant barriers as:
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uncertainty in the position of social clauses under EU procurement
legislation
-
not enough knowledge and information about the potential uses of social
clauses and
-
a lack of guidance on the how, when and whys for social clauses
What would be needed to increase the use of social clauses?
Purchasers wanted to see:
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further Government guidance
-
case studies and
-
guidance from national improvement agencies
Providers looked for:
-
assessment of the use of social clauses in local authority contracts to
be part of the procuring agencies’ accountability mechanism
-
for policy development support and
-
for programmes to happen in order to raise awareness of the opportunities
and benefits provided by social clauses
OTS and NECE would like to thank all the agencies that helped promote the
survey and all the participants for taking the time to share their
knowledge and experience. The survey was a key element of the work
seeking to capture experience and leading practice and the lessons learned
and data collected has given a clear direction for the second stage of the
project.
The next stage of the project is to support a number of local authorities
seeking to enhance the social value of procurement exercises in the waste
and recycling sector.
