Social Value Engine
14
Measuring the Impact of Rural Economic Development
Claire Watts
East Riding of Yorkshire Council
Local Multiplier Effect
-Measure of added economic benefit of money being spent in a local economy.
-Often used to describe the impact of local spending campaigns.
-Analyses expenditure in any defined geographic area.
-Public sector can adopt ‘local multiplier’ methodology as a standard measure of added value when considering procurement decisions.
Economic performance measures
Commonly known as Local Multiplier 3 (LM3)
Calculated in 3 key activities:
Stage 1 – Total spend/ project cost
Stage 2 – Spend with local suppliers/ direct employees
Stage 3 – Local re-spend of local supplies and direct employees
LM3 = (S1 + S2 + S3)/S1
- Census
- Indices of Multiple Deprivation
- Rural Urban Classification
- Nomis (Labour Market Statistics)
- Nearest Neighbour Model
Economic performance measures
Case Study: Withernsea Boat Compound
£940k project
YORbuild construction framework awarded contract to South Yorkshire company
£162k retained locally in Round 2, mainly through local suppliers.
LM3 total = £1.17
£0.17 in £1.00 spent retained in the local economy
LEA
LEA
Indices of multiple deprivation
Indices of multiple deprivation
Inclusive Growth Monitor
Inclusive Growth Monitor
- Developed by the Joseph Rowntree Foundation in 2016
- Measures economic inclusion with prosperity
- Comprised of 18 nationally available indicators
- Resource for LEPs, local authorities and campaigners to understand benefits of growth
- The East Riding scored 8/9 in economic inclusivity and 5/9 in prosperity, compared to the national average.
- By comparison the Leeds City LEP scored 4/18 compared to our 13/ 18 total when compared to the national average.
Strategic sites example
Strategic sites example
M62/ A63 Corridor
M62/ A63 Corridor- 84% Rural
Social Value
The Alternative
A different type of measurement
Seeing value in a different way?
Unlocking the social value of a project to the wider economy
Seeing the real value of money spent in the context of our holistic economy and on at a local level
What is Social Value?
'Value, not in its financial sense but in its true sense – recognises the importance of social, environmental and economic well-being across our communities and in our lives'
Chris White, former MP & the Government’s first Social Value Ambassador
'Social value has real potential to act as a value for money tool for commissioners tackling severe cost pressures'
Lord Young, led a review of the Social Value Act (2013-2014)
What is Social Value?
The Origins of Social Value
Public Services (Social Value) Act 2012
The Origins of Social Value
- The Bill asks public bodies, by law, to consider the ways that spending benefit society as part of the decision making process.
- It applies to all public services contracts.
- The Act sits alongside other procurement laws (value-for-money: how this is calculated, whole life cycle requirements).
- Social value asks the question ‘If £1 is spent on the delivery of services, can that same £1 be used to also produce wider benefit to the community?'
Bristol Accord
Case study
Outcomes & Outputs
Deflators
Social Value Engine
What does the Engine Provide?
Social Value Engine
- A systemised and academically robust assessment of social value for you to forecast, plan and evaluate your activities.
- More than 100 peer-reviewed financial proxies derived from reliable sources.
- A description of how a project creates value, and a ratio that states how much social value (in £/€) is created for every £/€ of investment.
- It enhances your ability to evaluate activities in the context of sustainable communities.