Social Value in Procurement: A Complete Guide for UK Businesses
Social Value in Procurement: A Complete Guide for UK Businesses
Last updated: 24 June 2026 | Author: VerdaScope Editorial Team
Social value procurement is how UK contracting authorities — and the suppliers bidding for their work — deliver wider economic, social, and environmental benefit through public contracts. Driven by the Public Services (Social Value) Act 2012, central government Procurement Policy Note 06/20, and the Social Value Model, social value in procurement is now a core competency for public sector buyers and private sector bidders alike.
This guide explains what is the social value act, how the social value model works in practice, and how organisations can approach measuring social value credibly in tenders — without treating it as a box-ticking exercise.
Direct Answer
Social value procurement integrates economic, social, and environmental well-being objectives into how public contracts are designed, evaluated, and delivered. The Social Value Act UK framework (Public Services (Social Value) Act 2012) requires contracting authorities to consider social value before procuring services. Central government applies PPN 06/20, requiring a minimum 10% weighting for social value in scorecards using the Social Value Model. Suppliers demonstrate commitments through measurable outcomes — such as local employment, carbon reduction, and VCSE engagement — backed by delivery plans, not unsupported promises.
Key Takeaways
- The Public Services (Social Value) Act 2012 applies to service procurements by contracting authorities in England and Wales — consider social value before starting the process.
- PPN 06/20 mandates explicit social value evaluation for central government and arm’s-length bodies, typically with at least 10% weighting.
- The UK Government Social Value Model uses themes, outcomes, and measures (TOMs) — including COVID-19 recovery, inequality, climate, and wellbeing.
- Measuring social value requires defined metrics, baselines, and contract management — aligned to frameworks such as National TOMs where used.
- VCSE procurement (voluntary, community, and social enterprises) is a recurring social value theme — supporting local organisations through spend and subcontracting.
- Bidders should link social value offers to operational capability and sustainable procurement policies to avoid overcommitment.
What Is the Social Value Act?
What is the social value act? In plain English:
The Public Services (Social Value) Act 2012 (often called the Social Value Act UK) requires contracting authorities in England and Wales to consider how procurement might improve the economic, social, and environmental well-being of the relevant area — and how to secure that improvement — before starting a procurement for services (and certain mixed contracts).
Key points
| Aspect | Detail |
|---|---|
| Who it binds | Contracting authorities (local councils, NHS bodies, central government departments, etc.) |
| What procurements | Primarily services contracts above relevant thresholds — not all goods |
| When | At pre-procurement strategy stage — “think before you buy” |
| Geography | England and Wales (Scotland and Northern Ireland have separate frameworks) |
The Act does not mandate a fixed percentage weighting — that came through subsequent policy, especially for central government.
Public Services Act social value — common confusion
People search Public Services Act social value referring to the same 2012 legislation: the Public Services (Social Value) Act 2012. It amended procurement practice by embedding well-being considerations into commissioning decisions.
PPN 06/20 and the Social Value Model
Procurement Policy Note 06/20
PPN 06/20 (Taking account of social value in the award of central government contracts) requires:
- Central government departments, executive agencies, and non-departmental public bodies to explicitly evaluate social value in all central government procurement
- A minimum 10% weighting to social value in the total score (quality plus social value), with flexibility for complex procurements
- Use of the Social Value Model and model evaluation criteria
Social Value Model structure
The UK Government Social Value Model organises expectations into policy outcomes:
| Theme (examples) | Illustrative outcomes |
|---|---|
| COVID-19 recovery | Supporting local communities and supply chains to recover |
| Tackling economic inequality | Creating new jobs, apprenticeships, skills development |
| Fighting climate change | Net zero commitments, reducing emissions in delivery |
| Equal opportunity | Diversity, inclusion, accessibility in workforce |
| Wellbeing | Healthier, safer communities; mental health support |
Each outcome links to model award criteria and suggested measurement approaches in procurement guidance.
National TOMs
Many local authorities use the National TOMs (Themes, Outcomes, Measures) framework — developed by the Social Value Portal — to standardise measuring social value across contracts. Measures might include:
- Number of local jobs created
- Apprenticeship weeks
- CO₂e reduced
- Spend with SMEs and VCSEs
- Volunteering hours
Authorities may adapt TOMs to local priorities. Bidders should read each tender’s specific social value schedule — not assume a generic response.
Social Value Procurement for Buyers (Public Sector)
Pre-procurement
- Identify social value objectives aligned to corporate plan and local needs
- Engage stakeholders (communities, VCSEs, economic development teams)
- Document consideration in business case — Social Value Act compliance
- Select relevant Social Value Model outcomes or National TOMs
Tender design
| Element | Practice |
|---|---|
| Weighting | Minimum 10% central government; local authorities set own weightings |
| Questions | Clear, proportionate, linked to contract delivery |
| Method statements | Require implementation plans, not vague commitments |
| SME/VCSE access | Proportionate lot sizes; prompt payment clauses |
Evaluation
- Score against published criteria only — maintain audit trail
- Verify plausibility of commitments (capacity, track record)
- Avoid evaluating unrelated CSR activity not tied to contract performance
Contract management
- Social value KPIs in contract management plan
- Regular reporting — quarterly or as specified
- Adjust if delivery context changes (within contract law)
Integrate with wider sustainable procurement — social value overlaps environmental themes (climate) and ethical supply chains (Modern Slavery Act compliance).
Social Value Procurement for Suppliers (Bidders)
Winning approach
| Weak bid | Strong bid |
|---|---|
| Generic CSR brochure | Contract-specific delivery plan |
| Unmeasurable promises | KPIs with baselines and milestones |
| Ignoring local context | References local geography and partners |
| Overcommitting | Achievable targets with named resources |
| Social value separate from price/quality | Integrated operational model |
Evidence to prepare
- Previous contract social value reports
- Apprenticeship and training programmes
- Carbon reduction data (links to PPN 06/21 Carbon Reduction Plans for major central contracts)
- VCSE partnership letters or subcontracting intentions
- Diversity and inclusion statistics (where published voluntarily)
PPN 06/21 interaction
Suppliers bidding for central government contracts ≥ £5 million per year must submit a Carbon Reduction Plan under PPN 06/21. Environmental social value commitments should align with published carbon data — inconsistencies undermine credibility.
Measuring Social Value
Measuring social value is challenging because outcomes are diverse and attribution is disputed. Credible approaches:
1. Define the unit of account
What are you measuring? Jobs, tonnes CO₂e, volunteer hours, £ spent with local SMEs?
2. Set baselines
Compare against pre-contract conditions — not marketing aspirations.
3. Use recognised frameworks
- UK Government Social Value Model measures
- National TOMs (where authority adopts)
- HM Treasury Green Book principles for appraisal (public sector)
4. Report during contract life
Social value is not only a tender score — contract managers track delivery. Under-delivery may affect extension decisions and reputation.
5. Be cautious with monetisation
Social Return on Investment (SROI) models exist but require transparent assumptions. Do not present speculative valuations as audited facts.
| Measure type | Example | Data source |
|---|---|---|
| Output | 5 apprenticeships started | HR records |
| Outcome | 3 apprentices employed full-time post-qualification | Follow-up survey |
| Impact | Improved local employment rate | Hard to attribute — use careful language |
VCSE Procurement
VCSE procurement — engaging voluntary, community, and social enterprises — supports social value through:
- Direct awards or lots reserved for VCSEs (where law permits)
- Subcontracting portions of large contracts to local social enterprises
- Prompt payment and capacity-building support
- Partnerships delivering employment programmes for disadvantaged groups
Central government and councils increasingly track VCSE spend as a social value metric. Large primes should plan VCSE routes before tender submission — not as an afterthought.
Environmental Social Value and Climate
Climate-related social value is explicit in the Social Value Model. Relevant actions:
- Net zero aligned delivery plans
- Ultra-low emission vehicles in contract fleets
- Waste reduction and circular economy practices — see what is circular economy
- Sustainable sourcing in contract supply chains — sustainable sourcing guide
Avoid double-counting the same initiative across multiple themes without clarity.
Common Mistakes
| Mistake | Consequence |
|---|---|
| Copy-paste tender responses | Poor scores; delivery failure |
| Commitments without governance | Missed KPIs at contract management |
| Treating social value as philanthropy only | Fails model outcomes tied to contract |
| Ignoring proportionality | SMEs excluded from unrealistic pledges |
| Green social washing | Unverified environmental claims — UK Green Claims Code risk |
UK Examples
Local authority facilities contract
Authority weights social value at 15%, uses National TOMs for jobs and apprenticeships, requires quarterly reporting, and scores bidders on local subcontracting plans.
NHS framework supplier
Bid includes measurable training placements for local residents, EV transition plan for logistics fleet, and partnership with VCSE employment charity — each tied to contract KPIs.
Central government IT services
Supplier meets PPN 06/20 social value weighting and maintains Carbon Reduction Plan under PPN 06/21; reports diversity hiring and SME spend through contract management portal.
Social Value in Different Procurement Routes
| Route | Social value consideration |
|---|---|
| Open procedure | Full social value weighting in evaluation; competitive market |
| Framework call-off | Social value may be evaluated at framework setup or mini-competition |
| Direct award | Still consider Social Value Act for services — document rationale |
| Below-threshold | Act may still apply to services; local policy often includes social value |
| Goods-only | Social Value Act focus is services — but carbon and fair work may appear in specifications |
Always read the contracting authority’s procurement strategy — weightings and model outcomes vary.
Template: Social Value Commitment Structure (for Bidders)
Use this structure in tender responses:
- Understanding — show you read the authority’s priorities and geography
- Commitments — SMART targets (Specific, Measurable, Achievable, Relevant, Time-bound)
- Delivery plan — named roles, milestones aligned to contract start
- Partners — VCSE or training provider letters of support
- Measurement — data sources and reporting frequency
- Risks — what could prevent delivery and mitigations
| Weak commitment | Strong commitment |
|---|---|
| “We support local communities” | “We will create 4 FTE local jobs within 6 months of contract start, evidenced by payroll” |
| “We value diversity” | “We will deliver 200 apprenticeship hours with [named college] by month 12” |
Scotland, Wales, and Northern Ireland
| Nation | Note |
|---|---|
| Wales | Social Value Act applies; Well-being of Future Generations Act shapes public priorities |
| Scotland | Separate procurement regulations and sustainable procurement duty on public bodies |
| Northern Ireland | Distinct procurement policy; social considerations in CFPO guidance |
UK-wide bidders should tailor responses to devolved priorities — not submit identical social value text nationwide.
Contract Management: Protecting Social Value Delivery
Winning the tender is only the start. Build these controls into delivery:
- Named social value manager on contract with authority to coordinate partners
- Baseline survey at contract start for jobs, skills, or carbon metrics
- Quarterly internal reviews against commitments — flag slippage early
- Evidence library — photos, payroll extracts, training logs (GDPR-compliant)
- Variation process — if context changes, agree adjustments with commissioner formally
- Final account — social value report at contract end supports re-tender references
Under-delivery without explanation can damage framework standing and future scores.
Frequently Asked Questions
What is social value procurement?
Procurement that deliberately delivers economic, social, and environmental benefits beyond the core purchase — evaluated and managed through the contract lifecycle.
What is the social value act?
The Public Services (Social Value) Act 2012 requires contracting authorities in England and Wales to consider how procurement could improve local well-being before procuring services.
What is the social value model?
The UK Government framework setting policy outcomes and model evaluation criteria for social value in central government procurement, used with PPN 06/20.
What is the minimum social value weighting?
PPN 06/20 requires at least 10% weighting for central government procurements. Local authorities may set different weightings.
How do you measure social value in contracts?
Define KPIs aligned to tender commitments — jobs, skills, carbon, SME/VCSE spend — collect data during delivery, report on schedule, and review at contract milestones.
Does social value apply to private sector procurement?
The Social Value Act binds contracting authorities, not private companies directly. Private firms encounter social value when bidding for public contracts or when corporate customers adopt similar criteria.
What is VCSE procurement?
Procurement approaches that include or prioritise voluntary, community, and social enterprises as suppliers or subcontractors.
How does social value relate to sustainable procurement?
Social value is the social (and partly environmental) dimension of sustainable procurement — particularly prominent in UK public sector practice.
Next Steps
- Procurement hub — sustainable procurement guide
- Policy template — sustainable procurement policy template
- Supply chain ethics — Modern Slavery Act business guide
- Carbon in tenders — net zero guide
Sources and Further Reading
- Public Services (Social Value) Act 2012
- PPN 06/20 — Social value in central government procurement
- PPN 06/21 — Carbon Reduction Plans
- Cabinet Office — Social Value Model
- Social Value Portal — National TOMs
This article is for general guidance only. It does not constitute legal or procurement law advice. Regulated procurements must comply with applicable UK procurement regulations.