New Social Value Model PPN 026: Impact on Public Sector Suppliers

The Cabinet Office has published definitive guidance on the new social value model, PPN 026, which is set to become mandatory for central government contracts from 1 January 2027. This update shifts the focus towards tangible outcomes in two primary areas: the creation of high-quality jobs and the development of skills to address national shortages. Procurement professionals should note that these rules replace all previous social value policy notes for central government departments and their executive agencies.

A significant change involves mandatory weighting for social value in tender evaluations. For contracts valued between £1 million and £5 million, a minimum 10% weighting must be applied to the social value score. This increases to 20% for contracts worth £5 million or more. Buyers are also encouraged to conduct pre-market engagement to ensure these criteria are realistic for SMEs and voluntary organisations before formal tendering begins.

To aid compliance, the government will soon release a 'List of Community Programmes'. This resource will highlight existing schemes that suppliers can support to meet their social value commitments. While using these programmes is optional, they provide a structured route for bidders to demonstrate place-based benefits, such as supporting apprenticeships or improving fair pay standards within local communities.

For procurement managers and supply chain leads, this update requires a review of bidding strategies and supplier engagement processes. Understanding how to evidence support for fair working conditions, flexible working, and talent pipeline development will be critical for maintaining competitiveness in the public sector marketplace. Early adoption of these standards is encouraged by the Government Commercial Agency ahead of the 2027 deadline.

Source: GOV.UK Procurement