New plan to increase number of ‘ethical’ suppliers to the Council agreed

Published: Thursday, 17th November 2022

Oxford City Council has agreed a new plan to buy more of its goods and services from businesses that ‘do good’ for local residents.

The City Council spends about £150m on goods, services and construction projects every year.

As the City Council is public body, there is a strict process – known as procurement – that must be carried out before taxpayers’ money can be spent.

In 2020, the City Council committed to include ‘social value’  weighting- the added benefit to the community from a procurement process, such as using locally-sourced materials - as part of the formula to decide whether or not to procure goods or services from a business.

In the latest procurement strategy, which was agreed by the City Council’s Cabinet yesterday (16 November), the organisation has doubled the emphasis on ‘social value’ (from 5% to 10% of the formula) if companies want to successfully bid for Council contracts.

Quality and value for money sit at the heart of the strategy.  Beyond those key criteria, the change means that businesses who hire apprentices, give to charity or work to tackle the climate emergency, will receive a higher score and are, therefore, more likely to be chosen as Council suppliers.

One of the other ways businesses can argue social value is if they are based in Oxfordshire, hire local residents and purchase their goods and services locally. The intention is the new procurement strategy will see more of the City Council’s money spent in the Oxfordshire economy.

The Council’s Procurement team works with all of the Council service areas and its wholly owned companies within the Group (Oxford Direct Services Limited (ODSL), Oxford Direct Services Trading Limited (ODSTL), Oxford City Housing Limited (OCHL) and Oxford City Housing Development Limited (OCHDL) to ensure best value for Council contracts with suppliers. Oxford Direct Services (ODS) is one of the Council’s main suppliers.

Building a fairer economy

The Council is keen to use effective procurement as a vehicle for building a fairer economy across Oxford as part of its corporate objective to enable an inclusive economy.

The aim of this objective is to distribute wealth more equitably across the city, for example, by encouraging businesses to pay the Oxford Living Wage and to provide affordable space for Oxford residents, including those from more deprived areas, to start new businesses.

Community Wealth Building and Social Value

The Council is committed to the Community Wealth Building approach – where local institutions use their assets, spending power and influence to build a truly inclusive local economy.

Social value can be defined as the additional benefit to the community from a procurement process over and above the direct purchasing of goods, services and or works.

The new Procurement strategy places greater emphasis on social value commitments and outcomes, including OxTOMs, an Oxford version of the TOMs (Themes Outcomes and Measures) framework for delivering excellence in measuring and reporting social value. The Council plans to offer training and support to potential suppliers to the Council in this area as part of its “How to Tender” workshops.

This approach has resulted in a range of commitments from suppliers to support Oxford’s local communities, including:

  • Support of Oxford Living Wage
  • Coaching for business impacted by Covid-19
  • Commitment to work with ASPIRE and other VCSEs (Voluntary, Community and Social Enterprise)
  • Student Placements, including five paid work placements for students at Blackbird Leys College, and five free legal consultations for businesses in Oxford
  • Engaging local sixth form business studies pupils with the CIPFA (Chartered Institute of Public Finance and Accountancy) Management games
  • Investment of 2% of service fee into a Community venture of the Council’s choice and offer a ‘living lab’ service enabling students to get involved in the local project to gain insight and exposure to the construction industry
  • Donation of equipment to specialist deaf schools
  • Donation of excess food to the local community
  • Health and Safety training to boost employment
  • Sports sponsorship and equipment donation
  • Support of woodland trust and tree planting
  • £500 donation per year to Oxford's Community Impact Fund 'Big Ideas'

Procurement also aims to support the city’s transition to Net Zero by 2040, ensuring climate change adaptions will be incorporated into major projects at all stages of the procurement exercise.

Oxford Living Wage

The Council will seek to promote and increase the number of suppliers that adopt the Oxford Living Wage or Living Wage Foundation rate on supply of goods, services or works by incorporating the requirement into both tender documents and terms and conditions, ensuring that local suppliers pay a fair wage to employees.

Oxford is regularly named as the least affordable place to live in the country. The Oxford Living Wage, which is administered by Oxford City Council, is set at 95% of the London Living Wage and aims to recognise the high cost of living in the city.

The Oxford Living Wage rate will rise from the current rate of £10.50 per hour to the new rate of £11.35 from 5 April 2023.

Councillor Ed Turner, Cabinet Member for Finance and Asset Management at Oxford City Council, said:

“This new procurement strategy aims to use the Council’s significant purchasing power to retain wealth that benefits the local economy, influences sectors to provide an Oxford Living Wage to employees and unleashes the potential of the voluntary and third sector.

“In taking this approach, the Council will not only deliver a successful local economy for everyone but can also help address a wide range of ethnic and social disparities, push employers to become inclusive, significantly contribute to our ambition to be zero carbon and deliver value for money for Oxford’s citizens.

“Obtaining best value is an essential requirement in the spend of public money and one that cannot be achieved without the support of our suppliers. We also need their support to increase the amount of social good that can be achieved for the local community”.

For more information on the Council’s procurement process, please visit:

https://www.oxford.gov.uk/info/20023/selling_to_the_council