Social Partnership and Public Procurement Act | What it means for social enterprise

One of the most important developments in the Senedd in 2023 was the Social Partnership and Public Procurement Act becoming law. It has the potential to transform how we do politics and policy development in Wales, and is seeking to have a significant impact on the economy too – with opportunities for the social enterprise sector to benefit.

In this blog, we will explain why social enterprises should be ready and prepared to engage with this vital piece of legislation, and how Cwmpas can help public bodies to maximise the potential of social enterprise in achieving socially responsible procurement.

What is the Act?

The Act is a landmark piece of legislation that will create a collaborative system of governance that sees the Welsh government, trade unions and employers formally work together to create a better, fairer Wales. As well as creating a Social Partnership Council to ensure these values are at the heart of the government, the Act gives a duty to public bodies to source goods, services and materials in a socially responsible way.

The duty requires a contracting authority – the local authority buying goods or services – to seek to improve the economic, social, environmental and cultural well-being of its area by carrying out socially responsible public procurement. They are required to set, publish and review  . In order to contribute to the achievement of these objectives, a contracting authority must:

• take all reasonable steps to meet its objectives when carrying out public procurement in respect of prescribed contracts;
• take prescribed actions when procuring major construction contracts or outsourcing services contracts.

It requires large public construction projects and outsourcing service contracts to have regard for codes and model clauses set out by Welsh Government Ministers. For construction projects these are in relation to payments, employment, compliance, training, sub-contracting and the environment, and for outsourcing contracts it is in relation to protecting staff terms and conditions.

In practise, this means providing employment opportunities for disadvantaged and marginalised groups, delivering appropriate training, and ensuring that employment rights, access to trade unions, and union representation are enforced and respected.

How social enterprises can help public bodies to meet their obligations

There is no doubt that social enterprise is very well aligned with the renewed focus on ensuring that public procurement seeks to improve economic, social, environmental and cultural well-being. The sector, through its triple bottom line model, contributes significant and diverse social value that aligns closely with Welsh Government policy priorities and the well-being goals set out in the Well-being of Future Generations Act. Some of the most common impacts identified by social enterprises are displayed in figure 1:

Our Social Business mapping report found that 66% of respondents pay the living wage to all staff, demonstrating that this fairness and commitment to fair work is at heart of the triple bottom line model in the sector. In addition, our research shows that social enterprises are particularly strong in areas with challenging economic conditions, showing the vital role they can play in creating economic well-being and resilience in communities.

If you are a social entrepreneur and think your organisation can benefit from engaging with the public procurement agenda and want to learn more about how you can take advantage of the new public procurement environment, Cwmpas can help. We can help you identify where you need to build capacity to fit the needs of public bodies and where the social value you create can given you a considerable advantage.

Cwmpas can also help public bodies to maximise their use of the social enterprise sector in developing public procurement strategies that prioritise well-being as set out in the Act. We help a diverse range of organisations to identify social value, connect their supply chain with social and local enterprises and assist with social value strategy implementation. Our team of specialists work closely on procurement research and development, to advise government and public bodies on how to maximise social value.

New opportunities to influence policy through the Social Partnership Council

The Act will make an immediate impact for workers in Wales through its changes to public procurement, and there is potential for even more exciting and impactful policies to be developed in the future through greater collaboration and engagement. The Social Partnership Council is made up of a variety of employers, trade unions and representative bodies, and we will work to ensure that the value of social enterprise is at the heart of their discussions.

As Wales continues to develop its collaborative approach to policy development, there will be significant opportunities for social enterprise and co-operative models to come to the fore and become the business models of choice in Wales.

If you would like to discuss how your business or organisation can engage with the social partnership agenda, get in touch via our Policy and Engagement Officer, Dan Roberts, via dan.roberts@cwmpas.coop.