Case Study 1 - Social Value

HCT Delivering Social Value– Dai Powell, Chief Executive

Procuring for Social Value in Knowsley- Ian Bancroft, Head of Social Growth

Procuring Social Value- To Encourage Social Innovation

and Social Growth

An Emerging Approach in Knowsley

Ian Bancroft, Head of Social Growth, KMBC

Knowsley - Location

Social Growth to reduce dependency

Public Sector

Private Sector Social Sector

ResilientCommunities

Creating the Conditions for Social Innovation leads to Social Growth

• Procuring for Social Value• Social Enterprise Support• Social Finance : Knowsley Foundation• Public Service Mutuals : Knowsley Youth Mutual• Community Led Solutions to Independent Travel• Asset Transfers : Newstead School• One Approach to Volunteering• Social Sector Collaboration : Forward Together

Social Value = Social Growth in Knowsley

• Public Services (Social Value) Act 2012

• Defining Social Value Locally

• Knowsley Definition“Outcomes, measures and activity that will create strong and well connected public, private and social sectors that enable communities to be more resilient”

Social Value Outcomes & MeasuresOutcomes (6 in total) Examples of Measures (29)

1. Increase in Community Resilience

- Provision of working age population in work

2. Reduction in Demand for Public Service

- No. of people supported to live independently

3. Impact of Volunteers - No. of new volunteers

4. Impact of Community Businesses (CBs)

- No. of CBs with social purpose linked to communities

5. Private Sector Investment in Communities

- Level of investment in Knowsley as part of CSR.

6. Residents Making Socially Responsible Decisions

- Increase in recycling rates for household waste

Domiciliary Care Example

• Current contract specification is a series of input based tasks, e.g.:– cook evening meal– assist with dressing

• Note the contractor has no requirement or incentive to deliver innovation in service delivery and improve its effectiveness.

Domiciliary Care Example

• The next contract specification will have in addition to the tasks to be undertaken:– core social value outcomes– added and appropriate social value outcomes

The following will potentially form part of the specification:– reduction in hospital admissions– reablement of clients to have reduced or no

service needs– removing sense of isolation by encouraging

and supporting service users to participate fully in the community, to access community activities and services and that their contribution is valued equally with other people

Core Social Value Outcomes

Added Social Value OutcomesThe following will potentially form part of the tender:– employment & training opportunities including

for those with a disability– contractor’s supply chain supporting smaller

community business and groups– investment as part of contractor’s corporate

social responsibility– evidence of delivering social value previously

Evaluating Social Value

In evaluating the tenders, this is how the scoring of the bid might work:

% scoreCost (inc. core sv) 40

Service provision & outcomes (inc. core sv)

50

Added social value 10

100

2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/200

10,000

20,000

30,000

40,000

50,000

60,000

Spending as share of available resources

All other Services

Environment / Waste

Adult Social Care

Childrens' Social Care

£bn

Conclusions and Context

Innovative public procurement for social entrepreneurs - Delivering social value

Dai Powell, OBE Chief Executive, HCT Group

HCT Group is a social enterprise

Which means that commercial buses like these…

…Pay for community services like these….

…Making a real difference to people’s lives.

About HCT Group

■ From a community transport charity founded in 1982■ To a social enterprise with a turnover of €50m

(2012/13)■ 98% of revenue comes from contracts■ Competing against the large multinational operators■ Profits reinvested in the communities where they are

earned■ A focus on community-led service design

Welcome to our world…

■ Local Authority A – SEN transport contract – at tender, we offer 10 new jobs for hard to reach

unemployed – no extra cost (unscored) – 6 months after start, offered an EU grant for the jobs…

…the LA can’t count it as an outcome otherwise

■ Local Authority B – day centre transport– taking older people from home to day centre and back– on route, a supermarket and sheltered accom.– we offer to connect the two during dead time– no extra cost – declined on the grounds it would ‘raise expectations’

The world we want

■ These cases are not uncommon■ Real available gains from SE innovation ■ LAs face barriers to realising these gains

– silos– input/output contracts– culture and imagination

■ SEs and Authorities share the same values ■ This makes real partnerships possible

– true open-book contracting – co-creation of services– community-led service design– shared incentives to innovate

Step 1: Embracing Social value

■ SE is a model that can create real value■ Social Value Act means it must be considered■ Simple compliance is a missed opportunity ■ Knowlsey’s approach to social value:

– goes far beyond compliance – social value as a strategic opportunity– leads to a practical set of options for commissioning

Step 2: unlocking ‘whole place’ approaches

■ Social Value as a step to unlock practical commissioning for ‘whole-place’ policies

■ Captures the connection between commissioning transport and:– addressing local unemployment– wellbeing and inclusion – education, health…

■ Provides the opportunity to also think about transport in a ‘whole-place’ context

Transport strategy today…

■ Too often, Authority engagement in transport is to remedy market failure

Payment for non-viable routes

Subsidy for vol sector remedies

Payments for social provision

Cost for externalities of poor transport

Subsidy for low margin routes

Market provision

€€

€

€

€

€

Shareholder value

Whole place delivery

■ Commissioning with a whole place approach locks in resources for public benefit

Market-driven (fare-box)

SE‘whole-place’

delivery

Contract services

Profit share

Local AuthorityCommissioning

Low-margin routes

A ‘whole-place’ approach

Step 3: The ‘Social Citizen’

■ Social value commissioning enables place-wide externalities

■ Commissioning at ‘place’ level enables cost-saving■ But… ■ Place-level initiatives have failed in the past■ A sense of place cannot be imposed from above■ Must be mediated by the public – the ‘Social Citizen’

– user-led service design, based on outcomes– purposeful, binding consultation– volunteering/active citizenship– community ownership?– community investment?

Delivery mediated through active engagement

The social citizen

€Place-based

Fare-box Commissioning Low margin

Non-commercial routes

Public infrastructure

Novel community solutions

Community buses

Community connections

(Buurt)

Group transport

Questions? Comments?