Public Procurement: price-taker or market-shaper?

The pandemic has thrust the role of public procurement in the UK and other countries into the spotlight like never before, raising concerns and questions about how value is defined in publicly funded contracts.

The changing landscape of procurement policy globally is the subject of research by Sandra Hamilton, a PhD researcher at the Manchester Institute of Innovation Research at Alliance Manchester Business School, who has identified three distinct procurement mindsets – localism, globalism and sustainability – and four other emerging themes.

The UK government has changed how value must be defined in public procurement, becoming the first nation in the world to mandate the evaluation of social value. Effective from April 2022, the NHS will also adopt mandatory social value procurement, committing to align the power of healthcare procurement with five key policy objectives – COVID Recovery, tackling economic inequality, fighting climate change, providing equal opportunity, and improving wellbeing.

Sandra, who is a member of Greater Manchester Mayor Andy Burnham’s Real Living Wage City Region Steering Committee, says the region has been at the forefront of advancing the idea that companies bidding on public contracts are rewarded for addressing inequality and societal challenges. She says: “Having now been adopted at the central government level and across the NHS, the concept has rapidly gained legitimacy.”

How universities operate and define value in procurement is also critical to advancing a more socially responsible and sustainable economy. Sandra suggests that one way for Greater Manchester’s five universities to align with recent advances across the broader public sector would be to adopt mandatory social value procurement and embed the GM Good Employment Charter into the University Civic Agreement. “By rewarding social responsibility in procurement, universities have the opportunity to deliver exemplary role model leadership, while advancing knowledge and improving lives.”

  • You can read a longer blog about Sandra’s work here.
  • A film where Sandra talks about her work can also be viewed here