Source · Select Committees · Scottish Affairs Committee
Recommendation 72
72
Accepted
Another tool the MOD uses to attempt to deliver benefits for local economies and communities...
Conclusion
Another tool the MOD uses to attempt to deliver benefits for local economies and communities is through using social value criteria to evaluate contracts. The MOD has a minimum 20 per cent weighting for social value. which will be applied to shipbuilding competitions.113 We heard that the three areas the MOD will use to evaluate social value are tackling economic inequality, fighting climate change and equal opportunity.114 Some 110 Defence in Scotland: military landscape: Government Response to the Committee’s First Report, Third Special Report of Session 2022–23, HC 674, p. 2 111 National Shipbuilding Office, National Shipbuilding Strategy Refresh, CP 605, 10 March 2022, p.51; Department for Transport, Maritime 2050: Navigating the Future, 24 January 2019 112 Q24 113 Ministry of Defence (DIS0031) 114 Q28 28 Defence in Scotland: military shipbuilding witnesses suggested different criteria should be used to measure social value: Ian Waddell of the Confederation of Shipbuilding and Engineering Unions argued in favour of the number of UK jobs supported by a bid, the value put into UK supply chains, and the level of tax to be paid in the UK, among others; Richard Powell of the Society of Maritime Industries argued that skills development should be a criterion.115 In evidence from the MOD it appeared these were used as criteria in at least some contracts. Vice Admiral Paul Marshall told us In terms of what more we can do, we put a heavy premium on social value in the contracting phase, and a big part of that is in supply chain development and encouraging our suppliers to develop the local supply chain for small to medium-sized enterprises. The Type 26 was a single-source contract, with BAE, and the social value framework did not apply. For the Type 31, we definitely applied those rules; we incentivised the development of the supply chain for the Type 31. We did similarly for Fleet Solid Support.116
Government Response Summary
The NSO and the MOD are committed to ensuring that social value commitments through Government shipbuilding procurements and investments are delivered. Under the Cabinet Office Social Value Model, the contracting authority is also mandated to assess the supplier’s performance.
Government Response
Accepted
HM Government
Accepted
Both the NSO and the MOD are committed to ensuring that social value commitments through Government shipbuilding procurements and investments are delivered. Under the Cabinet Office Social Value Model, the contracting authority is also mandated to assess the supplier’s performance. This includes monitoring and recording any social value commitments made by the supplier for the entirety of the contract lifespan.