The UK is at a crossroads in terms of how its economy serves — or doesn’t serve — the people who live here. The cost of living crisis saw prices rise sharply across the UK between 2021 and 2022, with the annual rate of inflation peaking at 11.1% in October 2022. Prices haven’t gone down in the two years since, and wages have barely risen to meet them. Similarly, the housing crisis continues to put affordable living spaces out of reach for more and more British citizens, as the poorest 20% of renters in the UK pay over half their income to landlords, and (in 2023) England had the highest proportion of homeless households in the OECD.
With over £390 billion of public money spent every year, public procurement is one of the largest levers at the government’s disposal for redressing social inequalities, according to a recent report by the Trust for London.
More than buying goods and services
The report, Public Procurement For Good argues that government purchasing can do more than buy goods and services. Public procurement used for the public good can, the report argues, lift communities out of poverty, promote fair wages, and build a stronger, fairer economy through better wages, working conditions, and legislation that fights discrimination in the labour market.
Setting the Real Living Wage as a default condition of every public contract as a minimum will ensure that good employers are not undercut by the bad and will generate more money in local economies.
Making “Good Jobs” a standard condition of very public contract will ensure public money isn’t wasted on employers who fail to guarantee their employees decent conditions at work. “Bad work” drags down local economies and leads to increased pressure on hard pressed public services.
By rebuilding local economies to support Good Work organisations, authorities have the power to reserve contracts for organisations and programmes designed to tackle discrimination in the labour market. The report research shows that if the UK government directed just 1% of procurement spending towards such positive action employment programmes this would generate £3.9 billion of contracts — helping support local delivery and address economic inactivity.
The Government also recently issued a National Procurement Policy Statement Survey. Trust for London is urging individuals and organisations to support its recommendations through responding to the survey and making the case for:
- Real Living Wages as a minimum for every public contract.
- Good working conditions as a baseline standard.
- Reserved contracts for social enterprises and local organisations that put communities first.
You can access the government survey here, which closes on 4 November.
If you miss the deadline, you can still make your views known by emailing your MP or the transforming procurement team at procurement.reform@cabinetoffice.gov.uk.
