How to get maximum social value from procurement

For us the living wage is an important part of a much bigger picture when it comes to ensuring the council achieves the maximum social value from its procurement processes.

After taking control of the council in June 2012, the current Labour-led administration quickly implemented the living wage for its own staff and announced its intention to create the Birmingham business charter for social responsibility.

Once launched a year later, signing up to the charter became a condition of contract for any organisation entering into a relationship with the council – with payment of the living wage embedded as a key condition for achieving charter status.

The charter outlines how an organisation can improve the economic, social and environmental wellbeing of Birmingham that results from its activities.

Clearly when introducing something so different to what suppliers were previously used to, it was inevitable there would be some concerns and suspicion but by a process of constructive and persuasive dialogue we have been able to explain the benefits of the scheme and why we are committed to its implementation.

This is why it is extremely pleasing we’ve now got more than 100 signatories, with the century being notched up by construction firm Carillion, the firm behind the construction of the widely-acclaimed Library of Birmingham and the soon-to-begin Paradise Circus redevelopment in the heart of the city centre.

But it’s not just about big name industry giants. We have organisations of all shapes and sizes signed up, including some firms that don’t even have a working relationship with the council but are keen to show they share the same values that we hold in high regard.

Looking forward, we have another 100 companies and organisations progressing towards accreditation and expect the number signed up by April 2015 will exceed 250, with the 1,000 mark a target for one year’s time.

But what of the living wage itself? What does that achieve? First and foremost, it rewards a fair day’s work with a fair day’s pay – ensuring people have enough money to enjoy an acceptable quality of life. The living wage also has many spin-off benefits for the employer, which include improved morale for staff, better attendance rates and ultimately improved productivity. And as lower-paid people can afford to travel less and save less, the extra money gets spent in local communities, creating a virtuous circle of economic regeneration.

The council has accounted for introducing the living wage for care contracts in its long term financial plan. Detailed analysis is also being carried out in the early years sector to assess the impact and implications of requiring payment of the living wage in the early years/nursery sector.

It cannot be right that we put the care of those we love the most in the hands of those we pay the least.

In conclusion, we aren’t standing still. We plan to review our charter to ensure its aims and requirements remain relevant. We will also be reviewing the council’s social value policy for the same reasons.

If any organisation is on the fence when it comes to implementing the living wage, we’d say the rewards you reap from its introduction far, far outweigh any perceived negatives.