Social procurement

The Social Procurement Toolkit is an extension of the Victorian Government's Social Procurement: A Guide for Victorian Local Government (the guide) (PDF 1.1 MB) or (DOC 1.6 MB), which was developed to support Victorian councils to increase their capacity to deliver effective social outcomes through their procurement processes.

The guide provides an excellent high-level information overview of social procurement and was the first social procurement guide of its kind in Australia.

The toolkit provides councils with information, guidance notes and templates as part of a practical step-by-step guide for incorporating social procurement into every stage of a procurement project, including:

Step 1: Establishing a Social Procurement Environment
Step 2: Becoming Social Procurement Ready
Step 3: Social Procurement Planning
Step 4: Procurement Documentation
Step 5: Implementation

Step 1: Establishing a Social Procurement Environment

To successfully undertake social procurement, councils need to be prepared - through their internal polices and procedures.

To set the stage for social procurement, there is a need to gain senior manager support for social procurement initiatives and it is important to ensure that council officers who will be required to assist in undertaking social procurement initiatives have received briefings and communications on the councils social objectives that are to be achieved through the procurement process.

The following tools will assist in gaining support and setting the scene for social procurement across all levels of the organisation:

Step 2: Becoming Social Procurement Ready

Once the stage for social procurement has been set, it is time for councils to review and update internal policies and procedures to ensure that they align with the with social objectives and outcomes of the organisation.

Tool/Template What will this help with?
Embedding social procurement in council policies and plans (DOC 93.5 KB) Guidance on reviewing and updating council policies and plans to reflect the inclusion of social procurement in councils processes.
Social procurement principles checklist (DOC 80.0 KB) A checklist of guiding social principles and council readiness.

Step 3: Social Procurement Planning

There are two scenarios where a council could possibly undertake social procurement:

  1. Dedicated social procurement project
  2. Embedding social procurement in a procurement project more broadly.

Both scenarios require the creation of a business case and no matter which scenario a council decides on, the following should be noted to assist in the procurement planning phase.

Tool/Template What will this help with?
Development a business case for social procurement (DOC 129.5 KB) Guidance and template on how to develop a business case for social procurement as a stand alone project or as part of a broader procurement project.
Quantifying the benefits of social procurement (cost-benefit analysis) (DOC 107.0 KB) Quantifies benefits and guidance on the cost-benefit of social procurement.
Researching local social benefit suppliers - information template (DOC 108.5 KB) A template for councils to use when researching the market supply of social benefit suppliers.
Local training and employment opportunities (DOC 187.0 KB)* Step by-step guide to developing a training/employment initiative internally.
Understanding social enterprises and other social benefit providers (DOC 134.5 KB)* An outline on the different types and operation of social enterprises including case studies suppliers.

* These documents have been written and provided by Social Traders in partnership with Landell Consultants. 

Social Procurement Environment and Opportunities Mapping Methodology Project

To assist with planning for social procurement initiatives, a key outcome of the Social Procurement: Expert Support Program is the development and implementation of this methodology.

Purpose of the methodology

The purpose of this methodology is to provide a framework for mapping and analysing the opportunities for social procurement at the local municipal level.  It is intended to assist council officers identify the local social procurement environment, and to analyse the 'readiness' of the local community to respond to social procurement opportunities.

In essence, the methodology seeks to identify what a council needs to know to recognise and undertake social procurement. 

Key elements of the methodology

(a) Priority - Local Issues

With the assistance of readily available information, the key unemployment/disadvantage issues that a council is aiming to address will be identified.

(b) Demand – Future Investment and Opportunities

Councils will be guided through a process of mapping the upcoming service and infrastructure investment flowing into a municipality from local, State and Federal Government as well as from private investors.

This investment will then be analysed in terms of its relevance and compatibility with the inclusion of social outcomes in delivery.

(c) Supply – Job Readiness and Skill Development

Councils will be given the tools necessary to map the existing social benefit suppliers (community enterprises) and service providers involved in job readiness and skills development (for example, job agencies, TAFE, employment brokers, etc) that exist in the municipality.

Supply mapping will determine the skills gaps that exist locally in meeting the 'demand requirements' of step b and how these gaps can be addressed.

(d) Analysis and Planning

Following on from steps b and c, councils will be able to analyse the investment flowing into the municipality, the social procurement opportunities that exist due to that investment and how to best target that investment to address the unemployment/disadvantage issues that exist in the municipality.

Social Procurement Environment and Opportunities Mapping Methodology (PDF 257.7 KB) or (DOCX 133.3 KB)

Step 4: Procurement Documentation

Regardless of how a council undertakes social procurement, all procurement documentation must clearly and accurately detail the expectation of the council on the social benefit requirement.

Evaluation is a critical component of a transparent procurement process –the template below gives assistance on how best to evaluate the social components of the proposed contract.

Procurement documentation formal processes (DOC 135.0 KB)

This documentation includes:

  • specifications
  • key performance indicators
  • selection criteria
  • contractual clauses
  • councils processes.

Evaluation of social procurement (DOC 86.0 KB)

Step 5: Implementation

Contract monitoring and reporting are important activities when undertaking any procurement process, social procurement is no different.

With respect to social procurement, tracking and reporting serves to:

  • determine the effectiveness of an organisation's social procurement initiatives
  • inform decision-making about the existing and future project design and management, including lessons learned
  • assist in the integration of sustainability into organisational operations, resulting in enhanced operating efficiency and cost savings
  • drive and promote transparency and accountability and meet disclosure expectations
  • reinforce organisational commitments and demonstrate progress to staff and stakeholders, thereby enhancing staff satisfaction, thereby improving service quality and their overall confidence in the organisation
  • improve internal governance
  • facilitate the exchange of learnings between organisations
  • enhance participation by various stakeholders in decision-making and governance.

It is important to note that for tracking and evaluation to be most accurate, the monitoring and reporting mechanism for social procurement must be planned for early in the procurement process and must align with the key performance indicators.

Monitoring and reporting of social procurement outcomes  (DOC 94.0 KB)

Page last reviewed on 7 October 2014

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