Aug 072014

An appreciation of the current situation and identification of requirements.

Prof Mike Martin - KITE (Centre for Knowledge, Innovation, Technology and Enterprise) Newcastle University

The impact of current developments

The stated aim of the Public Services (Social Value) Act 2012 is to strengthen the social enterprise business sector and make the concept of social value more relevant and important in the placement and provision of public services. The context of this initiative is a wider policy to shift service delivery responsibilities from public sector organisations, particularly Local Authorities and to encourage an expanded social enterprise sector, and the private sector, to provide service delivery capacity.

The NHS represents a complex cluster of distinct procuring authorities operating at many different levels from the centralised and outsourced NHS Supply Chain to locally and regionally operating Trusts and the new local CCGs. The act applies to the NHS at all of these levels.

The small scale survey and analysis reported here has been undertaken in the context of local developments in health and social care in a period where the introduction of the Social Value Act, has coincided with the inauguration of CCGs, the introduction of personal budgets in health and social care and the development of social prescribing. In addition to these organisational, legislative and social changes, we have also seen a growth in interest in, and the use of electronic channels, services and devices in delivery and management of caring services providing opportunities for participation in, and coordination of, services at home and in the local community. They have also increasingly been the medium for discussion and debate about these services and the experiences of service users.

The mandates and opportunities of social value commissioning , however, represent only a very minor aspect of the legal, managerial and governance challenges that are being faced by the newly forming CCGs. The first report of the King's Fund and the Nuffield Trust joint project to assess the implementation and impact of CCGs[1], identifies member relationships, the relationship with HNS England and the demarcations of responsibility for the procurement of primary care services, as the major issues and the significant challenges which have been dominating the agendas of the CCGs in their first phase of operation once the challenges of achieving the basic capability and capacity requirements under which they are approved for operation have been met. It is clear that uncertainty and the demands for change that are being experienced in this context mean that any creative response to the opportunities of social value commissioning will, at this stage, be local and fragmentary at best: this is not an issue which is able to command the attention of key players in the CCG arena.

The longer term perspective

If we accept the situation as described above and recognise that now is not an appropriate time to be addressing CCGs collectively and directly about the challenges of Social Value in their commissioning approach, we are then faced with the further question regarding what can be done now to prepare the ground and accelerate the processes by which such innovations could come to fruition as early as possible.

The implementation of a sustainable, social value based approach to commissioning and procurement[2] (SVP) involves a series of conversations between commissioners, potential and active service providers, service users and wider community beneficiaries. There are a number of pre-conditions for such conversations to be possible and fruitful. Some work and investment is required by all the parties to achieve these pre-conditions and to establish the required connections and relationships. All of this implies that work is required to achieve a community based readiness for SVP.

Commissioning Processes

The basic legal constraints of commissioning have not been changed with the Social Value Act. Their dual purposes are to protect the public financial interest and to provide fair access and competition among suppliers. The change implemented by the Act concerns what is allowed to be taken into account, and to which a value can be attached, in the selection between bids. A feature of procurement rules and processes, which is relied upon to achieve this fairness and protection, is the partitioning of the process into strict phases which are defined by the sorts of conversations and information exchanges that are allowed to take place within them and are not allowed between them. This results in four phases:

  1. Pre-procurement: In this phase potential procurers and potential bidders can talk to each other about what might be needed and what could be supplied. Such conversations may be public or may be in confidence but public procurers have the responsibility to demonstrate transparency and fairness and that preferential relationships are not being formed.
  2. Initial Procurement Phase: In this phase, a procurer announces the intent to procure in a particular area of supply and conversations can take place to clarify the needs, specifications and evaluation criteria and processes.
  3. Tendering phase: The procurement document is fixed, tenders are prepared by bidders and submitted within the deadline and are then opened and evaluated. The selection process defined in regulations and in the procurement document is executed to select a supplier and produce a contract.
  4. Delivery phase: The supply processes and relationships of the contract are delivered, reviewed and evaluated. This phase may then merge into phase 1 above as the term of the contract approached.

An important observation which must be made in the context of SVP under the new act is that phase 3 does not change in any way. The only things that can be taken into account in the selection process are the criteria explicitly defined and published in phase 2.

This implies that the precise definition and scoring methods of the Social Value dimensions for each procurement but have been defined and published beforehand: new concepts of social value cannot emerge in the evaluation process.

This factor is critical in the understanding of the pre-conditions required for SVP. If the legal requirements of the public procurement are to be respected while at the same time the creativity and innovation potential and social value are to be realised then both generic (phase 1) and specific (phase2) conversations and debates about what could count as social value and how precisely it will be valued, must be instigated, facilitated and sustained. They must also be informed by the experiences of phase 4.

Two further, related factors then come to the fore regarding these debates and the channels, media and mechanisms that support them. The first of these is participation: the four grouping identified above: commissioners, suppliers, users (carers and the cared for) and third party, community beneficiaries all need a voice and need to demonstrate a willingness to listen in this process. The second factor concerns the aegis, channels and media under which such debates can be conducted and trust in the provenance of the content guaranteed.

As stated in the first section, this survey and analysis has been undertaken in the context of a cluster of developments including personal health and social care budgets. The debate about social value, priorities and outcomes, which is key to both personalisation and localisation, is dominated by, but not limited to, Health. The remit of the CCG, under the current definitions, covers the clinical needs of:

  • Mothers and newborns
  • People with need for support with mental health
  • People with learning disabilities
  • People who need emergency and urgent care
  • People who need routine operations
  • People with long-term conditions
  • People at the end of life
  • People with continuing healthcare needs

All of these groups also have social care needs of one sort or another and these must also be included in the evaluation and decision making about outcomes and priorities if a user centred and joined up approach is to be delivered. In this conversation about priorities and outcomes, the individual and community perspectives as well as the clinical and social perspectives must all be taken into account.


We have observed that the current state of accommodation to significant reorganisation and redistribution of responsibilities in the NHS means that a creative and constructive response to Social Value in service commissioning is unlikely to be high on the present agenda. We have also observed that any longer term approach to developing good practice and sustainable operation in this area requires a wide and on-going engagement in conversations and debates about what count’s individually and locally as social value and individual benefit. Such a debate must be mediated through a variety of media and modes and must be conducted under appropriate aegis. While Local Authorities are designated as “market makers” and “place shapers” in the rhetoric of current policy, they are not well placed to provide the mediation and infrastructure for this wide ranging and multi-agency participation. Similarly, the CCG, Local Commissioning Boards or Senates cannot be expected to deliver this wide ranging remit on their own.

There is, therefore, a need to develop a partnership concept around social value commissioning and multi-agency care which provides a “stake holder engagement service” to the commissioners of personal health and social care services. The precise scope, possible providers and the means and mechanisms for the operationalisation of such a service, which could be defined and jointly commissioned by CCGs and Local Authorities, would require some careful thought, consultation and design.