Report

The promise of social procurement: leveraging purchasing power to create inclusive employment opportunities

Publisher
Government contracts Social outcomes Social procurement Government expenditure Job creation Socio-economic disadvantage Employment Victoria
Description

Every year across OECD member states, public procurement accounts for almost 30 per cent of government spending, representing on average 12 per cent of GDP.  Given its significance, public procurement can play a major market-influencing role through the process of social procurement.  It does this in two ways: by stimulating the large-scale production and consumption of goods, services and works that are ecologically and socially conscious; and by creating employment opportunities for jobseekers experiencing disadvantage.

It is the second role—the promise of social procurement for creating employment opportunities—that is explored in this paper. Using the state of Victoria as a case study, this paper demonstrates that linking employment policy objectives to public procurement has considerable potential, provided certain conditions are met.

In the aftermath of the COVID-19 pandemic, social procurement represents a significant strategy through which governments can help tackle some of the employment-related exclusion issues they face. By involving social benefit suppliers in their supply chains or using contractual obligations as a way of incentivising employers to take on jobseekers experiencing disadvantage, public bodies can help create employment opportunities through their goods, services and infrastructure contracts. Questions remain, however, as to what the most effective way of implementing social procurement activation policies might be—both at a federal and state level.

Publication Details
DOI:

10.25916/v6y9-1315

License type:
CC BY-NC-ND
Issue:
Research Paper No. 3, November 2020