The NHS roadmap: social value and carbon reduction expectations for suppliers

From April 2022, NHS organisations will be required to take social value into account when procuring goods and services. The move will see the NHS adopting the UK government’s Social Value Model, with NHS tenders required to include a minimum of 10% scoring criteria in all procurements to assess how suppliers will contribute to social value in contract delivery.

Since January 2021, the UK government’s Social Value Model has been mandatory in all central government contracts. Its launch followed the publication of procurement policy note PPN 06/20, which sets out how social value should be taken into account for all major central government procurement, as well as requiring it to be explicitly evaluated.

The Social Value Model sets out the government’s social value priorities for procurement and includes a menu of social value objectives centred around five themes:

1. COVID-19 recovery
2. Tackling economic inequality
3. Fighting climate change
4. Equal opportunity
5. Wellbeing

The model aims to make it easier to assess and evaluate the social value offered in tenders and manage the social value delivered in contracts. Publication of PPN 06/20 is a major step change from when the Social Value Act came into force, which only required public sector commissioners to ‘consider’ how they could improve the economic, environmental, and social wellbeing through their procurement activities.

Carbon reduction

In addition to social value, and to support its ambition to become net zero by 2045, the NHS will also adopt the recently released procurement policy note PPN 06/21 ‘Taking Account of Carbon Reduction Plans in the procurement of major government contracts’.

Adoption of PPN 06/21 will start in April 2023. The main feature of the PPN is the requirement for bidders to submit a carbon reduction plan (CRP) at selection stage where the anticipated contract value is above £5 million per year. Specifically, the CRP must:

• Confirm the organisation’s commitment to achieving net zero in their own operations by 2050
• Report current emissions using both:
  • Scope 1, 2 and 3 emissions (for the CRP, organisations are only required to cover five of the 15 categories in scope 3)
  • CO2e (carbon dioxide equivalent) for the six greenhouse gases covered by the Kyoto Protocol.
• Detail environmental management measures that will apply during the contract, such as relevant certifications (e.g. ISO 14001:2015) or specific carbon reduction initiatives (e.g., reducing vehicle mileage)
• Be published on the organisation’s website
• Have been signed off ‘at an appropriate level’, i.e. director-level, within 12 months of the date of the procurement.

From April 2024, the NHS will expand this requirement further to cover all new contracts irrespective of their value.

For more information on responding to social value and sustainability tender questions, visit our dedicated division The Social Value Practice, contact us free on 0800 612 5563 or email info@executivecompass.co.uk / enquiries@thesocialvaluepractice.co.uk.