The UK Government is dropping net-zero and domestic abuse criteria as part of its procurement requirements when agreeing contracts with outside firms.
Louise Haigh, who is effectively Andy Burnham’s deputy prime minister as First Secretary of State, told the Financial Times that Whitehall will scrap a list of demands that companies have had to satisfy in order to win deals.
“For too long, [public] procurement has tried to tick too many boxes,” she said.
She added: “If you prioritise everything, then you’re prioritising nothing.”
Haigh said the rules had included “a whole gamut of conditions around net zero, around the environment.”
She continued: “There were things that I think a lot of businesses would have struggled to prove, like tackling domestic abuse and improving high streets. It became quite amorphous”.
The Cabinet Office’s new “social value” model will require firms, both inside the UK and internationally, to show they are creating jobs and opportunities in Britain.
The weighting given to “social value” will increase from 10% to 20% for contracts worth £5 million or more, under the proposed model.
Guidance will be published in the autumn, and the new model will come into effect from January.
Haigh said: “We are stripping back what’s known as social value to focus it ruthlessly on that priority.”
She added all of the £90 billion spent by central government each year should help benefit local communities and the economy.
Burnham previously said the Government would change procurement rules to prioritise “social value” when giving out contracts, including whether firms offer young people work experience.
He told a podcast last week that he wanted to increase the number of 45-day placements given to 16 to 18-year-olds, which could improve their employability in a bid to drive down the number of young people not in education, employment or training (Neets).
“I will be changing public procurement (to include) more social value weighting in public contracts, and it will particularly be focusing on more provision of those 45-day work placements,” he told former political adviser Jimmy McLoughlin, host of Jimmy’s Jobs for the Future podcast.
Haigh told the Financial Times the current system meant small or medium sized businesses were being “crowded out”.
The report claims bidders will be given extra credit for creating local jobs that pay above minimum wage, and by offering the work experience Burnham has spoken about.
Haigh and Chancellor John Healey will write to Cabinet ministers asking them to identify firms who could be targeted for more government contracts, as part of Healey’s intention to “back British jobs and skills not just ‘where possible’, but by design”.
He had previously told Treasury staff this would be a priority in his first address to the civil service after his appointment.
When contacted, the Cabinet Office declined to comment.
