The effectiveness of the post-Brexit UK legal framework in enabling meaningful social value delivery through public procurement

In the UK, over £300 billion or 15% of GDP per annum is spent via procurement to discharge vital public services such as health, education and defence. The importance of effective procurement practice cannot be overstated in ensuring value for money for taxpayers with significant financial, legal and reputational repercussions for poor execution. Post-Brexit, the UK is radically reforming procurement legislation to ensure government contracts deliver not only the lowest price but also "social value," which is high on the political agenda.

Current UK procurement regulations are largely the product of EU Directives and so focus principally on driving competition to ensure non-discrimination on grounds of nationality within the EU internal market. Practically, the principles of non-discrimination, transparency and procedural fairness have contributed to procurement being one of the most "highly legislated and regulated fields of government" (Lloyd & McCue, 2004). In contrast with the international legal framework, cost reduction is often perceived as the main desired output of procurement on a national level. For example, a key priority for Government is achieving efficiencies across Whitehall spend (HM Treasury, 2022). It has been argued that competitive tendering results in "greater savings and maximises operating efficiency," (Crown Commercial Service, 2022) but the National Audit Office suggests this approach has led to "adversarial" supplier relationships which could negatively impact value for money. Public procurement is therefore delicately balancing meeting legal obligations and maximising value for money.

Another requirement of public procurement is driving socio-economic objectives. Following "Brexit" the UK has proposed the 'Transforming Public Procurement' bill which will replace current rules and mandates a new National Procurement Policy Statement committed to achieving social value outcomes. The Government is also on a major policy drive away from attaining lowest price towards a broader conception of public value or "social value" i.e. for government contracts to achieve a range of objectives beyond obtaining the goods or services themselves e.g. supporting sustainable development or increasing employment. This is achieved by including requirements for social value outcomes in tenders. Testing the supplier's capability to deliver social outcomes as well as the traditional price and quality metrics spurs the market to invest in social value offerings.

However, while it is clear that Government has a responsibility to add 'value' to citizens, defining what this value is, how to achieve it and how to balance it against the pressures of delivering at low cost remains a challenge. There is no uniform approach as public bodies set their own social value priorities which creates inconsistency in method and in outcomes.

There is a substantial gap in knowledge in this field in terms of the quantitative measurement of social value delivery and therefore this project will be the first to empirically assess the effectiveness of regulation in delivering social value. In doing so, it will identify best practice and reform.

Performance in terms of actual social value delivery remains difficult to measure. The lack of a consistent approach to social value metrics (i.e. what to measure and how) has presented particular challenges for undertaking systematic research.

This research will fill an important gap by exploring three critical areas:
1) The confidence of procurement practitioners in implementing social value;
2) Compliance with the social value policy regime; and
3) An objective assessment of the success of the regulatory framework in delivering social value.

With an incoming procurement regime and a 'cost of living' crisis, the efficient use of public funds is vital. Making recommendations for reform of the regulatory framework could help transform practice in this area.