Agenda item

Report from the Director of Policy, Strategy and Engagement.

Recommendations:

That Cabinet:

1.    Receive the annual report, noting the social value commitments along with outcomes delivered. 

2.    Approve that the key priorities for 2026/27 are:

a.    Continuing to ensure social value commitments made within the procurement process are delivered through contracts.

b.    Championing democratic business models through employee ownership and 21st century social clubs.

c.     Continuing to build on opportunities to support residents into employment and strengthen access to good-quality jobs across the borough.

d.    Enabling more socially productive use of land and property.

e.    Following the changes proposed nationally, exploring how to maximise local benefits from investment. 

3.    Agree to delegate authority to the Director Policy, Strategy and Engagement, in consultation with the Leader of the Council, to extend the Social Value Policy approved by Cabinet in March 2024 to March 2029.

At the Chair’s invitation, Councillor Read, Leader of the Council, presented the annual Social Value Report. It was noted that the report had been aligned with the wider Community Wealth Building agenda. Social value commitments had increased by 30% and delivery by 50% since the previous report, generating £23 million of social value through local jobs, apprenticeships and increased spending within the local economy.

Support provided through procurement brokerage; the Go for Growth programme and partnership working was highlighted as helping local businesses and residents access economic opportunities. An update was also provided on employee ownership and co-operative development, including engagement with more than 30 businesses and support for eight social clubs.

RDASH's achievement of Real Living Wage accreditation was welcomed, alongside the continued contribution of partner organisations through the Rotherham Together Partnership. Priorities for further strengthening social value delivery were outlined, and reference was made to emerging national procurement reforms intended to improve accountability for suppliers' social value commitments.

The Director of Policy, Strategy and Engagement, Jane Maxwell welcomed the progress made through the Social Value programme and advised that work was underway to strengthen the Council’s approach to community wealth building. It was noted that internal arrangements would be reviewed to ensure the right services were engaged and that close working with procurement and contract management colleagues would continue to maximise social value opportunities. Emphasis was placed on both contractual measures and strong supplier relationships to support the delivery of positive outcomes for residents.

The Chair invited members of the Overview and Scrutiny Management Board (OSMB) to raise questions and queries, Councillor Blackham referred to recent Government changes that had reduced the tax advantages associated with employee ownership and asked whether these changes were affecting demand for the support provided, what impact was anticipated, and how the Council intended to respond.

The Leader advised that recent changes to tax incentives had led some businesses to question whether employee ownership remained as attractive as previously but stated that it was too early to assess the long-term impact on demand for support. It was noted that work had expanded into the 21st Century Social Clubs programme and that much of the employee ownership support focused on business owners approaching retirement, promoting employee ownership as a means of protecting the long-term values and continuity of businesses. It was confirmed that the tax changes had not altered the Council’s overall approach and that the wider effects would continue to be monitored.

Councillor Blackham asked when the current uncertainty surrounding employee ownership demand was expected to become clearer. Concern was raised that, if fewer businesses pursued employee ownership because of changes to tax incentives, the dedicated officer resource could become underutilised, and clarification was sought on whether alternative uses for that resource were being considered.

The Leader advised that there were no plans to redeploy the dedicated officer, as there remained ongoing work to support existing employee-owned businesses and those considering employee ownership. It was noted that the officer continued to play a valuable role within the regeneration service, and while future policy changes could affect demand, the Council remained committed to the post.

Councillor Yasseen expressed support for the Social Value programme but sought assurance on how its impact was being measured. Reference was made to procurement readiness support provided through the Chamber of Commerce, and clarification was requested on how many businesses receiving support subsequently progressed through procurement processes or secured contracts, as this was considered a more meaningful measure of success.

The Leader agreed that measuring outcomes was important and advised that information would be sought on the results achieved through the Go for Growth programme. It was acknowledged that understanding how many supported businesses went on to secure contracts or progress through procurement processes would provide a stronger measure of impact, and further information would be provided where available.

Councillor Yasseen requested further information on Real Living Wage accreditation outcomes, the geographical distribution of support and benefits, and equalities data, particularly in relation to engagement with and outcomes for ethnic minority-led businesses. Concern was raised that relatively few ethnic minority-led businesses appeared to secure contracts despite significant ethnic minority populations in some parts of the borough.

The Leader acknowledged that these issues had been raised previously and agreed to provide further information in writing where available.

It was noted that many ethnic minority-led businesses were likely to be smaller enterprises, which could face greater challenges in accessing public sector procurement opportunities. The Leader advised that support available through the Go for Growth programme may help address these barriers and undertook to explore whether information on participation by ethnic minority-led businesses was available.

The Leader also clarified that social value activity was supported by two specialist procurement officers and an employee ownership officer within RIDO, alongside contributions from a range of services including procurement, employment support, policy and economic development. It was emphasised that delivering social value relied on a wider organisational commitment rather than a small number of dedicated posts, and a commitment was given to provide further information on geographical distribution, ethnic minority business engagement and Go for Growth outcomes.

The Chair advised that, following discussions, it was felt the policy was operating successfully and did not require annual scrutiny review. It was proposed that the policy be reported to the Board on a biennial basis. The Chair then sought a show of hands from Members in support of the recommendation. Upon being put to the vote, the recommendation was carried unanimously.

Resolved: That the Overview and Scrutiny Management Board supported the recommendations that Cabinet:

1. Receive the annual report, noting the social value commitments along with outcomes delivered.

2. Approve that the key priorities for 2026/27 are:

a)    Continuing to ensure social value commitments made within the procurement process are delivered through contracts.

b)    Championing democratic business models through employee ownership and 21st century social clubs.

c)    Continuing to build on opportunities to support residents into employment and strengthen access to good-quality jobs across the borough.

d)    Enabling more socially productive use of land and property.

e)    Following the changes proposed nationally, exploring how to maximise local benefits from investment.

3. Agree to delegate authority to the Director Policy, Strategy and Engagement, in consultation with the Leader of the Council, to extend the Social Value Policy approved by Cabinet in March 2024 to March 2029.

An additional recommendation to Cabinet from OSMB was that:

4. Cabinet is asked to note that the Overview and Scrutiny Management Board (OSMB) has agreed to scrutinise the Social Value Annual Report every two years.

Further actions that arose from discussions were that:

·       Information on the uptake of support by BAME-led businesses, particularly in relation to the support offered through the Chamber of Commerce and Go for Growth programme be provided.

·       Information on the outcome measures from Go for Growth, including evidence of progression and success in response to questions about whether businesses receiving procurement-readiness support were subsequently securing contracts or progressing through procurement processes be provided to members of OSMB.

·       Information be provided to OSMB setting out the specific outcomes arising from the Social Value Programme, including evidence of the tangible and longer-term benefits delivered through social value activity, the outcomes and impact of Real Living Wage accreditation, how social value benefits have been distributed across different communities and areas of the borough, and information demonstrating how social value activities and procurement opportunities are supporting equality objectives and benefiting under-represented groups.