Devolution hands local authorities powers to level up procurement: Simon Hill

This bill is the latest in a series that gives greater control over council and combined authority budgets, to create more positive impacts in communities across the UK.

Achieving this overarching goal will necessitate business communities and local government bodies to actively engage with a shifting public sector procurement landscape.

For example, businesses must tailor bids to localised social, economic, and environmental priorities, highlighting their community contributions.

Local authorities must develop clear social value strategies, train their teams in contemporary procurement practices and foster strong collaborative relationships.

These unique circumstances offer a genuine opportunity for positive change, but we are fooling ourselves if we do not recognise that there will be challenges. We need to understand the current state of play to overcome upcoming barriers.

Demand is surging across the UK for core services like social care, housing, and, increasingly, SEND provision in education. To manage this urgent demand, local governments are being asked to implement digital transformation programmes, operate waste disposal services that comply with new recycling reforms, improve transport connectivity, and support regional economic growth plans.

This is no small achievement, especially given the context of reduced budgets and the looming threat of Section 114 notices that essentially declare a council bankrupt. Creating value in these priority spending areas will require intelligent, strategic procurement planning, particularly in a changing legislative landscape.

More than ever, the UK government is focusing on procurement’s transformative power, concentrating efforts on improving efficiency, transparency, and fairness.

Through the Procurement Act 2023, the government aims to empower public bodies to use a central digital platform with improved transparency, new routes to market, streamlined notice requirements, and more flexible frameworks. For councils across the UK, the aim is to encourage more accountable spending of taxpayer money with greater local benefits.

These are admirable ambitions, and procurement organisations are legislatively aligned with these aims in providing frameworks for the public sector to acquire goods and services, particularly with an emphasis on delivering social value in contracts.

Whilst the new bill does not directly redefine social value in UK public procurement, it significantly increases the incentive for its delivery.

In short, procurement organisations quantify social value and factor it into awarding supplier contracts.

The variables procurement organisations consider when measuring social value include community and environmental impacts, alongside financial value.

Measuring these factors helps the public sector support local communities and should become a greater consideration as devolved powers expand. Businesses must also communicate how they can benefit communities and provide value in their tendering processes.

Our overarching goal should be to ensure these ambitious legislative reforms translate into practical improvements.

Procurement will play a crucial role in achieving this, but ultimately, success depends on public sector organisations and businesses understanding this evolving landscape to collaborate effectively. By doing so, we can ensure that essential services are delivered with both financial and social value, providing the best return on investment and benefiting regional communities.

Simon Hill is the Managing Director of YPO