Suppliers bidding for UK public contracts worth £5m or more face a fundamental change in how their tenders are scored, with local job creation replacing the social-value measures that previously included equality, diversity, net zero and post-Covid recovery. According to the BBC, the government is doubling the weighting for community benefits from 10% to 20% and redefining what that weighting measures, a shift that procurement teams at both British and international firms must fold into their bid strategies.
Procurement scoring shift
The prime minister, Andy Burnham, will tell firms bidding for public contracts to prove they are creating jobs rather than meeting green and social targets, in a bid to get more people into work, the BBC reported. The change is part of an overhaul of the £90bn public procurement system, requiring bidders to show they are supporting young people into work and addressing local skills shortages. Burnham said he wants to create "growth in every postcode".
Under the changes, the Cabinet Office said, the weighting given to the benefits brought by companies will be doubled, from 10% to 20% for contracts worth £5m or more. Previously, that weighting accounted for how companies created social value through measures such as equality and diversity, net zero and the post-Covid recovery. The new 20% measure will instead be based on job creation.
| Evaluation element | Previous rules | New rules |
|---|---|---|
| Weighting for community benefits | 10% | 20% (doubled) |
| Contracts covered | Not specified | £5m or more |
| Basis of the weighting | Social value: equality, diversity, net zero, post-Covid recovery | Job creation |
| Extra credit criteria | Not specified | Local jobs above minimum wage; training to plug skills gaps; 45-day work experience placements |
Bidders will be given extra credit for creating local jobs paying above the minimum wage, plugging local skills gaps by offering training and particularly by offering 45-day work experience placements for young people.
The unemployment context
The policy is being introduced as the government tackles the youth unemployment crisis. Office for National Statistics (ONS) figures show more than a million people aged 16 to 24 are currently not in education, employment or training (Neet). Burnham previously used a similar initiative during his time as mayor of Greater Manchester, the BBC reported.
Reaction: ministers and green groups
First Secretary of State Louise Haigh, who is effectively Burnham's deputy prime minister, called the current procurement process a "tick-box exercise". "Every pound of taxpayer money should be spent in a way that benefits local communities — creating good jobs and giving young people the skills they need for the future," she said in the BBC report. Haigh added: "These new rules will ensure the £90 billion that is spent each year through government contracts supports British jobs, skills and people in every postcode."
Cabinet Office Minister Mark Ferguson said businesses that secure government contracts "have a responsibility to give back". "Businesses that benefit from the billions of taxpayer pounds spent by government, will have to create more local jobs and opportunities for young people in their area," he said.
Green groups criticised the plans. Greenpeace UK's head of politics Ami McCarthy argued that protecting the environment and helping young people into work are "mutually beneficial and one shouldn't come at a cost to the other". She added: "Companies should be held to account with environmental targets to help achieve a better future without leaving young workers behind."
What this means for your procurement team
For procurement teams, the practical consequence is that the 20% evaluation weighting on contracts worth £5m or more is now tied to demonstrable job creation commitments rather than the environmental and diversity metrics many bidders have built into their tender submissions. According to the Cabinet Office, extra credit is available for local jobs paying above the minimum wage, training that plugs local skills gaps, and 45-day work experience placements for young people. Since the new model applies to both British and international firms, global suppliers will need to quantify regional hiring and training commitments in the UK for each bid.
Watch for two things in the coming months: how the Cabinet Office translates the job-creation criteria into an auditable scoring framework, and whether the removal of net zero and equality measures from this particular weighting prompts a compensating change elsewhere in the evaluation process. The BBC reported that green groups have already raised objections, signalling that the trade-off between employment and environmental targets will remain contested.
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