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Social Value: What does it mean for future supply chain contracts?

In October 2020, the NHS set out its roadmap to becoming net-zero by 2045, taking into consideration the impact caused by each area of the NHS from patients to production to procurement.

According to Greener NHS, 60 percent of the overall NHS carbon footprint is caused by the NHS supply chain, with more than 80,000 suppliers contributing to this in order to keep supply of drugs, food, medical equipment and more.

Whilst the NHS are doing all they can to improve their output and reduce their carbon emissions, suppliers are not yet in line with the health organisation and are still contributing a huge percentage to the NHS carbon footprint.

In order to align suppliers with the NHSs’ net-zero ambitions the NHS England Public Board have approved a roadmap which has set a standard that suppliers entering into a framework should adhere to help achieve this goal.

Below is the roadmap which is in addition to the UK Governments procurement policy:

net-zero supplier roadmap

Next month (April 2022), the NHS will adopt the Governments Social Value Model where new and existing NHS tenders will have to include a minimum of 10 percent scoring criteria in all procurements in order to remain or become an NHS supplier. The criteria will allow the NHS to see how much a supplier would be contributing towards the NHS’ net zero targets and social value.

Within the government’s Social Value Model there are five themes: COVID-19 recovery, tackling economic inequality, fighting climate change, equal opportunity and wellbeing.

Suppliers must complete a Model Evaluation Overview which will describe the organisations commitment to ensuring the contract delivers the themes set out in the Social Value Model.

COVID-19 Recovery:

When looking at new contracts the Government will consider the number of relevant outputs such as how it impacts the economy and local communities through factors like employment, re-training and return to work opportunities.

Contracts should look to outline how they will tackle high unemployment rates that have been caused by COVID-19 and how they could help to reduce this.

In addition, mental health, social distancing measures and remote working options are all also factors which new and existing contracts will be assessed upon.

Tackling economic inequality:

The Government will assess contracting authorities and ask them to report the number of full-time equivalent jobs and traineeship opportunities that will be created through their contracts.

This theme will also look to address any skill gaps that present themselves in the local area, particularly in technical skills such as in the construction industry.

Fighting climate change:

This theme will fall in line with the Government’s 25 Year Environment Plan, which sets out goals for improving the environment and how we can work with communities and businesses to achieve this.

Equal Opportunity:

The Government have set an aim to see one million more disabled people in work over the next ten years. This strategy looks to reduce the disability employment gap by ensuring a diverse and inclusive workforce to reflect the customers it serves and the community in which it is based.

Contractors must outline how likely under-representation may be within the workforce and if there are equal opportunities for employment of people with disabilities.

Wellbeing:

In partnership with Mind, the Government have created the Mental Health at Work website which includes resources to help both employers and employees address mental health within the workplace.

Progress under this policy will be monitored by the proportion of suppliers in the contract supply chain who have implemented measures to improve the health and wellbeing of employees.

You can see a full list of the priorities, policy outcomes, model award criteria and reporting metrics listed in the social value model here.

NHE will be hosting an NHS Procurement virtual event on 22 September 2022. Join us for the full day event by registering here.

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