Values-based procurement has a crucial part to play in driving economic equity. LHC Group interim chief executive Elaine Elkington explains why, exploring the role of public sector procurement in delivering quality housing for all and supporting a more diverse supply chain for social landlords

The quality of social housing has yet to be fully recognised as a cornerstone to the government’s levelling up agenda. Even less has been said about the pivotal role public sector procurement plays in achieving the social, economic and environmental benefits of such an agenda.

Low carbon new homes and retrofit programmes, underpinned by diverse regional and local supply chains and an unerring focus on social value, are just some of the crucial factors identified within LHC Group’s recently published report, How Public Sector Procurement Aids the Levelling Up Agenda.

The report brings together sector experts from LHC, the Home Builders’ Federation (HBF), Northern Housing Consortium (NHC) and industry equality, diversity and inclusion campaigners to explore these issues through a procurement and housing lens, identifying key things the public sector and construction industry must get right, now.

Together, contributors emphasise the inextricable link between housing and levelling up as stimulators of UK-wide social and economic opportunity, also highlighting programmes to deliver high quality homes for their potential to create jobs and ignite innovation in low carbon and sustainable building methods.

But beneath this sit the foundations of public sector procurement. A strong base is needed to guarantee a long-term pipeline of work that drives regeneration across our regions, while also shaping the very fabric of the way suppliers are appointed.

Tackling fuel poverty through construction

There has been much rhetoric around levelling up since the government’s 2019 General Election manifesto, with a Levelling Up Unit established in May 2021, September bringing the newly titled Department for Levelling Up, Housing & Communities (DLUHC) and £1.7bn allocated by the chancellor in his Autumn Statement for the Levelling Up Fund. Indeed, the LHC report follows the government’s recently launched Levelling Up White Paper, giving information on 12 missions across four broad areas.

The current energy crisis and impact upon standards of living for people across the country has ramped up the urgency of this situation. In the LHC report, John Slaughter, director of external affairs at HBF, earmarks tackling fuel poverty as a guiding principle for levelling up.

He says: “The relationship between poor housing conditions, high energy bills for heating and fuel poverty is well-known. Unsurprisingly, those affected by fuel poverty also have poorer health than those living in more energy efficient homes. Tackle this, and we start to tackle a host of deeper societal issues.

“One important way of breaking through the entrenched problems associated with poor housing and fuel poverty is to build homes of all tenures that are energy efficient, cheaper to heat and suited to today’s lifestyles. The housebuilding industry is committed to working collaboratively with the many parties involved to address these issues.”

Innovative, low carbon solutions

Retrofit skills and Modern Methods of Construction (MMC) should – and are – also forming part of the housing and construction roadmap to cheaper-to-heat homes.

Many social housing providers are already offering apprenticeships in retrofit, developing partnerships with local colleges and LEPs to make it a priority for regional economic recovery and reduction in poverty.

In the report, Northern Housing Consortium director Tracy Harrison says: “Housing associations and local authorities will need people with new skills to assess and design scheme and projects to decarbonise housing stock, while combined authorities are also prioritising retrofit skills to boost take up.”

In the North of England specifically, housing accounts for a quarter of total carbon emissions, with two-thirds of homes requiring retrofit to achieve the Energy Performance Certificate (EPC) band C requirement.

Commenting on this, Tracy Harrison says: “The housing retrofit market presents an opportunity for 77,000 direct jobs in the North of England alone. Yet we have a chicken and egg challenge where home decarbonising is still emerging and customer demand is latent, but long-term certainty over funding is needed to bring about the confidence and ambition needed in the housing and construction sector to build demand, develop supply chains, promote technological pathways and build skills in local economies.”

LHC’s report also looks at MMC as another way to raise regional housing standards, with Homes England’s Affordable Homes Programme requiring projects to deliver 25% through MMC.

Wider adoption is needed for offsite technologies, with a willingness to educate and change the way homes are designed, procured and delivered. Here, LHC’s role is to connect with social housing providers and wider homebuilding and construction supply chain, fostering more collaboration. This will mean risk is shared and delivery made more attractive and competitive through longer-term planning.

EDI: The missing piece of the jigsaw

The report also makes explicit the link between diversity, equality and inclusion and levelling up, calling on public sector clients and procurement bodies to actively seek out SMEs and suppliers from more diverse backgrounds – an approach taken in LHC’s Architect Design Services (ADS 1.1) and now being reviewed by the framework provider as to how it can be replicated nationally.

Particularly crucial to levelling up, working with diverse teams promotes learning from the lived experience of all groups within communities, often including marginalised or underprivileged in areas where many social housing providers may be most active. This brings new skills and fresh thinking in community engagement and outcome-led design.

public sector procurement

Writing in the report, Anjali Pindoria, Avi Contracts project surveyor, says: “When I think of ‘levelling up’, I don’t just think of place. True levelling up throughout all parts of the UK is not possible without significant progress to improve EDI. The key lies in education of the sector to embrace EDI naturally and instinctively, steering away from the tick-box attitude based solely on satisfying contractual obligations.

“But we also need to singularly target schools, because if we want new recruits who are from diverse backgrounds, we need to do more to change perceptions.”

Overall, the report points to the role of all public sector landlords and registered providers, and their procurement advisers and framework providers like LHC, to continue to collaborate closely, identifying and breaking down inequalities and barriers in their processes, and root out anything that doesn’t procure good outcomes, boosting equity and levelling up the regions.

Read the full LHC Group report.

 

Elaine Elkington

public sector procurement

Interim chief executive

LHC Group

www.lhc.gov.uk

Twitter: @LHCprocurement

LinkedIn: LHC

Youtube: LHC Procurement

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