By Sarah Dundas
We were delighted to hear that on Thursday that the Social Value Bill was unanimously passed by the House of Lords. The bill “[requires] public authorities to have regard to economic, social and environmental well-being in connection with public services contracts”. According to Chris White, the MP for Warwick and Leamington, the person responsible for introducing this Private Member’s Bill, its aim are to “support community groups, voluntary organisations and social enterprises to win more public sector contracts…so that a wider definition of value – rather than just financial cost – was considered”. In other words it is actively promoting opportunities for charitable and voluntary organisations to compete alongside the private sector to deliver public services.
The Government currently spends in the region of £236 billion each year on commissioning and procurement. Only 11% of government contracts are currently delivered by social enterprises and charities. We hope to see this figure rise in the near future. But what will it take?
Greenwich Leisure Ltd, for example, is a fine example of a social enterprise successfully delivering services. Set up in 1993 to run leisure centres for Greenwich Council and other London boroughs, its founding principle is based around its commitment to the provision of leisure and fitness facilities at affordable prices, but it has delivered many other positive benefits. Its exponential growth, which resulted in 2010 in a turnover of £80 million, has enabled it to become a significant employer and to act as a mentor to small social enterprises, helping them to win contracts and deliver public services to professional standards.
It is exciting to observe a demand for public accountability and recognition of the importance of wider public benefit, of the kind that social enterprises can deliver, featuring within new thinking. It is now vital for them to prove their effectiveness in terms of impact to be made relative to cost if we are to see a shift in the awarding of public services away from the private sector. For this to happen, the voluntary sector must work hard to deliver cost-effective, high-impact services that can match and outstrip the private sector.
We look forward to the bill coming into force as soon as it receives royal assent and witnessing the beginnings of a cultural change as it is put into practice. Let us know what effect you think this new legislation will have and how you think the third sector can become a major player. What will it take to change the landscape by which the current 11% share of government contracts doubles or triples over the next few years?