Maximising the value of every pound key to sustainable economy in County Durham

Jan 7, 2021 | Local News

Maximising the value of every pound spent in County Durham is key to developing a sustainable economy and driving forward recovery, councillors will hear.

Next week, Durham County Council’s Cabinet will receive an update on the progress and next steps for Social Value and Local Wealth Building (The County Durham Pound) project and the important role it will play in the county’s prosperity.

Social value is about driving the economic, social and environmental benefits for communities when making decisions about how contracts are awarded and budgets are invested. When employing a contractor factors such as the businesses’ environmental policies, apprenticeship programmes and community outreach work are taken into account, alongside considerations such as quality, price and timescales for delivery.

As an example, the council recently appointed Esh Construction as its contractor for the new £7.4 million Bowburn Primary School and the company committed to more than 40 per cent social value outcome in County Durham for the project. Esh also employs 340 County Durham residents, and has 450 County Durham businesses within its supply chain. The Durham-based firm is also one of only a few UK companies to have received the Queen’s Award for Enterprise for Promoting Opportunity Through Social Mobility.

Local wealth building, meanwhile, is about working with residents, businesses and partner organisations to create and retain wealth within communities. This could be through promoting locally owned and socially minded enterprises, establishing local supply chains or managing assets to allow communities greater control of buildings and land in their area.

The aim is to maximise the value of every County Durham pound spent to ensure it benefits as many people and businesses as possible. As part of this objective the council will also be working with other major employers in the county to ensure their collective buying and employing power works for the county.

Cabinet will hear that the council is already a national leader in this policy arena, demonstrating high levels of spending in County Durham and across the North East, with 68 per cent of its annual £530 million spend invested within the North East and 46 per cent in County Durham.

Furthermore, 57 per cent is spent with small and medium sized enterprises (SMEs) and 13 per cent is invested within the voluntary and community sector. This success has been part of a conscious and concerted effort to support local businesses over a number of years.

The County Durham Pound project, which was launched in September, aims to build on this success to drive forward recovery measures and accelerate the council’s work to develop a more sustainable local economy. This is being achieved by working with developers and suppliers to identify social value and wealth building opportunities, including ways to progress the council’s Climate Change Emergency Response Plan.

It also looks to ensure that social value and community wealth building are part of the council’s response to Covid-19 and the delivery of the four priorities within the Council Plan 2020 – 2023. These are to create more and better jobs; to help people live long and independent lives; to ensure communities are well connected and supportive of each other; and to be an excellent council.

A series of initiatives has been put forward and Cabinet will be asked to approve these, as well as note the achievements made so far. Key achievements include:

  • The council has increased its tender threshold from £50,000 to £189,330. The threshold is the point at which the bidding process becomes more intensive and increasing it will make it easier for suppliers to bid for contracts.
  • A 10 per cent minimum social value weighting is now applied to all procurement projects above the £189,330 threshold. This means that when considering bids social value factors will be a significant part of the decision-making process.
  • A Local Government Association National Social Value Task Force meeting is taking place this month to allow councils to review opportunities for social value to be applied to the planning process.
  • Business Durham, the council’s economic development arm, has produced a Covid-19 Business Support Brochure highlighting all the grant funding available. There is also an ongoing promotional campaign to increase take up.
  • Twenty-one businesses have engaged in the Durham Business Opportunities Programme’s Routes to Construction Contract Success project. This is aimed at helping County Durham SMEs and their supply chains win more public and private sector contracts.

Cllr Carl Marshall, the council’s Cabinet member for economic regeneration, said: “We are committed to ensuring County Durham is a place of opportunity, with vibrant communities, prosperous businesses and a thriving economy. By imbedding social value and community wealth building into everything we do, we can strengthen our communities and businesses while delivering high quality services. This will in turn enhance County Durham’s reputation as a place to live, work and visit, which will attract further investment and help to create and safeguard jobs.”

Cllr Alan Napier, deputy Leader and Cabinet member for finance, said: “Social value and community wealth building are all about ensuring that money and resources are managed in a way that maximises the benefits for County Durham residents and businesses. For example, if you invest £1 in a County Durham business, there is a high chance that business will spend that same £1 at another local business. And, if all the supply chain is local, that £1 investment will benefit even more County Durham businesses and its value will have been maximised.

“It is encouraging to see such a large proportion of the council’s budget is being spent in the county as this helps to sustain local employment and local communities. It is crucial we build on this success to ensure the county’s long-term resilience.”

Professor Claire O’Malley, Pro-Vice-Chancellor (Global) at Durham University, said: “We are proud to be Durham’s university and proud of the contribution we make to our local communities, economically, culturally, socially and through our world-leading academic research, which is tackling major issues globally and locally.

“We employ over 4,000 staff, generate more than £600 million for the North East economy every year and nearly a third of our total spending is with local suppliers. For every £1 we receive in funding, we generate more than three times as much for the economy.

“We fully support Durham County Council’s vision to drive up social value and build wealth locally and are pleased to be working with the council and other partners to be making this a reality and supporting the recovery and flourishing of our wonderful county and region.”

Cabinet will meet virtually at 9.30am on Wednesday 13 January. The meeting can be viewed online at www.youtube.com/DurhamCouncil