Tendering and Localism

“….and the winner is………..(wait for a pregnant pause)………..Staffordshire……..(cue applause)”

The tender in question was published in January for a contract based 49 local LOTS, one provider for each LOT. Then we have a March tender for a contract which divided a Local Authority into eleven areas. There are currently 19 providers who have been told that they can be awarded a maximum of one LOT or local area. One of the current providers delivers services across nine of these LOTS, so there are some hard decisions for them to make. Then we have a framework tender which requires applicants to answer five questions. The first is about financial matters which is fair enough, despite this being covered in the Selection Questionnaire. The remaining four questions are about aspects of Social Value. Apparently, the ability to deliver a quality service will be covers in the mini tender exercises which will be offered to those admitted into the framework. Surely this is the wrong way around? Apparently not.

Drivers for these changes arise from government edicts promoting localism set out in two Procurement Policy Notes (PPNs)

·        PPN 6/2020 requires all government departments to attribute at least 10% of any score to the social value offer and expects contributions to the value of 10% of the total contract value. This approach is being promoted as a standard for all public sector procurement.

·        PPN11/2020 dated 15th December 2020. This created new options for buyers of individual services contracts each with a total value of less than ￡122,976, to run these competitions specifying that only SMEs and VCSEs located in a given geographical area can bid, options are illegal under EU law.

Our observations of the uneven implementation of these new rules gained from our twice weekly reports of tenders published, have been confirmed in a recent report published by Trussel and the Social Value Portal. (Local Government Social Value Procurement Index). This report sets out the implementation of Social Value characteristics and the local orientation of Authorities by English region. 

Our observations and the research found that the London Boroughs are leading the way by many percentage points. No fewer than 90% of Boroughs are in the High Social Value Performance or Local orientation categories. 44% of Local Authorities in the North West Region are among the highest performers in terms of Social Value, but just 18% appear to be locally minded. Yorkshire and Humber Authorities are apparently good at spending through SMEs/VCSEs or local organisations, but only 8% perform well in terms of Social Value. The poorest performing Region which is said to require the greatest Social Value improvement is the East Midlands which, along with the East Region has no Local Authorities designated as Locally minded. 

These are all useful factors to bear in mind when balancing the effort which a provider need to place on the development of Social Value offers with the regions where contracts are to be sought. The overarching consideration is of course the cost of being able to make a substantial social value offer as part of the development strategy.