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The British choice: to innovate for the social welfare

Public expenditure From the product to the result: how the legislation on public contracts has changed in the United Kingdom, thanks to the Social Value ...

In the past, reaching Sainsbury’s supermarket in the London borough of Islington without a private car was not easy. Today it is possible for everybody: in fact the line 812, a community bus whose path has been designed by the users, reaches it. Designed according to the needs of elderly and disabled people, but on hand to everybody, the line 812 links to the main services: shops, surgeries and the most important leisure centers. The line 812 is not just a lifeline for its users: it has become an example of improvement of the public service through the social impact.


Hackney Community Transport (HCT) is the most important British social enterprise in transport and manages the classic red double decker buses in London. It was born on the needs of its district, developing the transportation of students, elderly and disabled people.

In the public service contract with Transport for London HCT has included the concept of outcome instead of output: that is to say the ability to generate new services of social impact, based on the same inputs required by the contract. The meaning is clear: if through urban transport it is possible to demonstrate a social and economical improvement achieved in public spending in the social area, this outcome is a social profit


As such it can be contracted, measured and subsequently distributed among the contractors that generated it and the public body which has benefited it, like an economic profit. 


It is also possible to optimize the input of the contracts, buses, drivers, … to produce new services in the private market: these extra revenues will lower the public spending linked to the contract itself.

The United Kingdom has introduced into its legislation the Social Value Act, which came into force at the end of January 2013.The government requires all public bodies to include in the public service contracts the economic, social and environmental impact of a local community.

As it happened in Italy with the launch of social cooperation, also in the UK one of the most common fields of application will be the job integration of disadvantaged and vulnerable worker: people with disabilities, mental health problems or with a criminal record.


To retrain public spending more wisely, including the concept of "social profit" in the delivery of public services, is very appropriate in this time of tight budgets. With the Social Value Act local authorities keep their freedom to look for service providers, with the addition, however, of having to give value to a local community. This foundational characteristic of the European third sector can become very competitive also in the UK.


This rule puts traditional private companies under pressure to provide a social value, in addition to the profit: it will perhaps be possible to see a real change in the way companies provide public services!


Italian version here