Councils are increasingly embracing social value legislation in their contracts and tendering processes for social enterprises and businesses but uptake is still low, research has found.

Based on Freedom of Information Act request to councils in England and Wales the research found that more than half (55%) never apply social value in their tendering and contracting.

A third have no social value policy and nearly half have never provided staff training on the issue.

Just half said they use a tool to calculate social value. Among those that do “there was no consistent approach”, which creates barriers for suppliers, say researchers.

This lack of action is despite the 2012 Social Value Act being in place requiring public sector organisations and their suppliers to consider how the services they commission and procure can improve the economic, social, and environmental well-being of communities.

The findings have been revealed at this year’s Social Value Leaders’ Summit, which is hosted by Social Enterprise UK in Manchester.

The research is part of the Social Value 2032 programme, a cross sector collaboration formed by Social Enterprise UK that aims to expand social value across public sector procurement and influence the spending of UK firms.

Progress

However, progress is being made. Most (58%) do have a social value policy or strategy, which is more than double the 24% who had such a plan in place in previous research carried out eight years ago.

The level of authorities applying the Social Value Act to all eligible tenders has tripled over this period, from 10% to 30%, according to researchers.

According to the Social Value 2023 campaign £750bn worth of opportunities to create economic, social and environmental value through more effective public sector procurement was missed between 2010 and 2020. This is the equivalent of £56bn a year.

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“We’ve already missed out on £56 billion since the Act became live – and with public expenditure likely to continue to be squeezed, regardless of who wins the next election, it is vital that the Act is used by all commissioners to maximise value wherever possible,” said Social Enterprise UK associate director and Social Value 2032 lead Joanne Anderson.

“While these figures are a promising development for social impact towards communities, local economies, and the environment, we’re still coming up against the barrier of consensus.

“For everyone to be on the same page, the public and private sectors need to come together and refine how we deliver social value even further. More importantly, it needs consistent widespread use in the short and long term if we want to see real effects in the UK’s supply chain ecosystem.”

Nancy Park, from Social Value 2032 partner PwC added: “We welcome the research by Social Enterprise UK to shine a spotlight on the importance of social value in the public sector.

“Whilst we are seeing progress with some early adopters really pushing forward with what is possible, there is still significant progress to be made. Leadership and culture are crucial in propelling the social value agenda and the necessary cultural shifts across all sectors to truly embed it."

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