Image: © Terry Robinson via Geograph

Companies should prove ‘social values’ as well as money-making skills, says government

The Carillion collapse has taught them a lesson or two about responsible business (or so you'd hope)

The government's decided that if they're going to work with private companies, they should probably make sure they've got good values, as well as good business skills, before partnering with them.

What it means: Remember when Carillion, the huge company managing lots of government contracts, collapsed a few months ago, and thousands of people lost their jobs? Yeah, that was fun.

The government spends about £200bn a year on contracting private firms for public projects. The rationale is that it's more efficient, but ever since Carillion collapsed, there's been more scrutiny on the topic – and it turns out for a quite a few government contracts in the recent past, the price was about 2-4% higher than normal. And cleaning up Carillion's mess will cost the government around £150m.

The Social Value Act, implemented in 2013, is a regulation which requires public authorities to consider wider social, economic, and environmental benefits when they're finding a firm to buddy up with.

But 'consider' isn't a very strong word, and it doesn't seem to have done much to change behaviour. So now they're changing it to 'explicitly evaluate' a company's values before partnering with them... which still doesn't actually seem to say you shouldn't partner with them unless their values are solid, but at least this is an explicit evaluation rather than just a casual 'consideration'.

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