Out of the Shadows? The fall and rise of social value in public services: a progress report

Out of the Shadows? The fall and rise of social value in public services: a progress report
Social Enterprise UK



In practice, the shadows around public services seem to be darkening with each news story. But 
in policy terms, there are a number of promising signs that public services might soon emerge 
from the grey. 
We are moving towards a policy landscape where first, elected representatives and their 
officials are increasingly given the flexibility to explore what they can achieve for the people they 
represent. Second, workers’ representatives are becoming more familiar and less suspicious of 
asset-locked and mission-locked social enterprises. And some are staring to see the 
possibilities for a new era of empowerment of our public sector professionals and workers. 
Finally, public service users may be given some influence over who delivers the services which 
are meant to benefit them. Some of the people we spoke to for this report expressed genuine 
hope for increasingly democratised public services employing tools like the Social Value Act. 
This policy landscape is being shaped by a seemingly unlikely coalition of EU lawmakers, the 
trade union movement, Cabinet Office Minister Francis Maude and Lord Young, an individual 
Conservative MP and frustrated citizens across the country waking up to the flaws in existing 
models. This broad church shows that we may be moving slowly beyond a tired conflict between 
century concepts of left versus right, pro-business versus anti-business and staff-side 
versus management-side towards a constructive recognition that we simply have to change the 
way we spend taxpayers’ money in the common interest. 
We believe that the stars are aligning to shine a light on a model which goes beyond the 
traditional debate between public and private, enabling greater innovation and entrepreneurial 
approaches while retaining a public service ethos. 
We stand by the recommendations we made in The Shadow State, which are more important 
than ever in ensuring social value is at the heart of our public services, while greater 
transparency can help safeguard services where the private profit motive looks set to remain in 


Recommendation 1 


Despite a promising start following the introduction of the Public Services (Social Value) Act and 
welcome accompanying changes to EU law, we still believe the Act should be strengthened. 
This is also supported across the political spectrum, for example by, among others, Chris White 
MP and Hazel Blears MP. In particular, that: public bodies should be obliged to account for how social value is generated in commissioning and procurement; the Act should be extended to apply to the purchasing of goods and works and the management of assets, including investments and disposals of capital, land and other assets; the Act should be supported with Statutory Guidance; and the Act should be given greater ‘teeth’ to ensure its implementation. 


Recommendation 2 


The Freedom of Information (FOI) Act and the powers that support transparency urgently need 
reviewing. FOI powers should be extended to companies delivering public services (taking into 
account proportionality and appropriate timeframes) 


Recommendation 3 


An independent contracting oversight body should be established to scrutinise contracting 
decisions and prevent unfair competition, with sufficient weight and power to challenge and 
overturn departmental decisions and to issue penalties.  
Recommendation 4 


The EU has made a welcome start in clarifying that performance under previous contracts can 
be explicitly weighed up as part of the decision-making process in procurement decisions. This 
now needs to become de rigeur when public authorities evaluate tenders. 


Recommendation 5


Open book accounting should be rolled out for all public- sector contracts worth more than 


Recommendation 6 


The new EU rules allow greater flexibility to support the introduction of innovative governance 
arrangements for public services in the community interest. Public bodies must act on this new 
flexibility to ensure communities are given a greater infleunce in the governance of their public 


Read the full report here.