Benefits for the public sector
1.8 Government did not assess the costs and benefits of this policy in detail before implementing it. However, we found a broad consensus among the departments and providers we met during our fieldwork on the benefits that can be achieved by using . The most commonly cited were innovation, flexibility and better value for money (Figure 1).
1.9 We were also told can offer additional benefits where their social or charitable objectives align with government's objectives. For example, are more likely to employ disadvantaged people. A recent report found that 59% of social enterprises employ at least one person who is considered disadvantaged in the labour market, such as the long-term unemployed or ex-offenders.
Figure 1
Benefits for the public sector of working with Benefits | Illustrative examples | Innovation - fresh thinking compared with established larger providers. | An was awarded a contract to provide the Driver and Vehicle Standards Agency's Hazard Perception Test. By using digitally generated people rather than real people in the video tests, they could use a far wider range of scenarios as there was no risk, therefore improving the quality of the test. | Flexibility - providers can be more agile and responsive to client needs as they have a direct relationship with commissioners. | Home Office awarded a hosting contract for the Disclosure and Barring Service to an that charges on an hourly basis allowing information services to be switched on and off freely depending on demand. | Better value for money - fewer corporate overheads and senior staff. | contracted an to use cloud hosting to deliver an information management system for a staff suggestion scheme for simplifying activities and reducing costs. The contract was delivered significantly faster and cheaper than other approaches. | Expertise - specialist skills and knowledge in a particular field can lead to better outcomes. | Department for Culture, Media & Sport's galleries procure fine art print from specialist as the usual central government printing providers do not have the requisite skills. | Local focus/knowledge - closer to the community and service users, hence better able to engage them and address needs. | Nuclear Decommissioning Authority recognises that many operating in the nuclear decommissioning supply chain are part of local communities so may be better placed to build relationships with the local community than larger multinational providers. | Economic growth - by growing the supplier base and creating jobs. | Research shows that for every £1 spent with an there was an additional 63p benefit for the local economy compared with 40p in every £1 spent with a larger business. |
Note 1 Federation of Small Businesses, Local Procurement: Making the most of small business, one year on, June 2013. Source: Case study departments and provider meetings |
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7 Social Enterprise UK, Leading the World in Social Enterprise, 2015.