Describing the social value of community groups and organisations in Sheffield

In our third meeting with the Working Better Together working group, we spoke about social value. The Venn diagram activity in February's meeting highlighted the value of the Voluntary, Community, Faith and Social Enterprise sector in Sheffield as being one of the most important things in our relationship, both being good value for money, but also the huge social value or impact these groups and organisations bring to communities around the city through offering person-centred and holistic support, creating connections between people and organisations, learning, work and volunteering opportunities, and much more.

Social Value in Procurement

Social value is also an important term in procurement, which is when the council buys goods and services. Social value in procurement aims to achieve more with the money the council spends and requires suppliers with large contracts to offer social value through things like local job creation, learning opportunities and sustainability. The current system has achieved some great impact for Sheffielders, but there have been questions raised about how well this system works for voluntary, community, faith and social enterprise organsiations. Sheffield City Council has committed to reviewing its approach to social value to make sure we can achieve better impact for the people of Sheffield.

In April we met to work together to answer two questions:

- How do we describe the social value of community groups and organisations in Sheffield?

- How might we approach social value in procurement differently?

What social value do community groups and organisations bring?

We heard from participants that social value "is just what [they] do". It is their main mission and at the heart of everything they do, and it's often what they do whether they are funded to do so, or not.

  • A safe, welcoming place to go where people can get supportand the information they need

  • Formal and informal learning opportunities to help peopleadjust to life in a new place or to enter the workplace

  • Ethical work places that provide work and volunteeropportunities for local people with lived experience

  • Deep understanding of communities, places and issues

  • Community ownership of spaces, libraries, parks buildingsand projects

  • Better connected and holistic services that are able to meetcommunity needs

  • Local partnerships and collaboration

  • Preventing crime and keeping people well

  • Community connections, friendships and bringing peoplefrom different backgrounds together

  • Reduce the need for and complement statutory services

  • Value for money

How does social value work in procurement, and how might we approach it differently?

Social value is now a legal requirement for public sector procurement.

“Using public spending to deliver wider social, economic and environmental benefits for communities, in addition to the main outputs of the contract. In practical terms, improving outcomes such as job creation, sustainability and community wellbeing.”

It aims to achieve more with each pound the council spends, particularly on largescale projects in commercial settings, e.g. a large construction company that wins a multimillion pound tender.

It aims to create additional social value on top of what is being contracted and we use a platform called the Social Value Portal as a measurement tool.

Issues have arisen in areas like people services, where non-profit providers have been asked to pay to use the platform and commit to providing additional social value on contracts that only just cover the cost of delivery.

Additional Vs Inherent Social Value

In the meeting we spoke about two kinds of social value:

Inherent social value

Social value or impact that's built into an organisation's mission and ways of working

Additional social value

The extra social value an organisation could commit to on top of a contract to deliver a service

A disadvantage for community groups and organisations

The group found that the vast majority of the social value they bring would be described as inherent, and therefore doesn't meet the requirements for social value in procurement. Members identified a few areas that they could build on their inherent social value as part of a contract, for example in the creation of local jobs. However, overall it was felt that the current approach to social value in procurement puts community groups and organisations at a disadvantage because it favours measuring additional social value that private sector companies might offer on condition of winning a contract.

How might Sheffield City Council approach social value in procurement differently?

The group came up with a number of recommendations:

  1. Design new social value measures with people and organisations in Sheffield to ensure they meet our communities' needs.

  2. Recognise inherent social value in procurement processes, for example and automatic 5% for registered charities or social enterprises.

  3. Social value should be baked in to applications, not an add-on.

  4. Make procurement more accessible to VCFSE and SMEs, e.g. by creating smaller contracts and supporting the creation of alliances.

  5. Prioritise grassroots to cut our middle men that aren't embedded incommunities.

  6. More co-commissioning to ensure we have better designed opportunities that benefit Sheffield.

What's next?

1. This is the beginning of a conversation to review the council's approach to social value in procurement over the coming year.

2. These insights will be fed into the council's Commissioning, Procurement and Contract Management change programme.

3. Finally, the insights will form part of our co-designed working principles that we are working towards with this working group.