Labour's new 'social-value' rules for government procurement are an imposition of left-wing ideology that prioritizes trade union interests over taxpayer value, according to Alex Burghart, Shadow Chancellor of the Duchy of Lancaster. Burghart argues that these rules will drive up costs for businesses and, consequently, raise prices and future taxes for the public.
The updated regulations require government organizations to consider 'social value' priorities when selecting companies for public contracts, with these factors now accounting for 20% of the evaluation points, a doubling of the previous weighting. Burghart contends that this significant emphasis on social value has no relation to delivering best value for money.
Concerns have been raised that the new rules could compel businesses to offer employees more flexible working arrangements, such as increased remote work or four-day weeks, which Burghart suggests could negatively impact productivity and profitability. Furthermore, suppliers may be required to grant unions substantial access to their staff, potentially allowing union representatives to hold meetings during paid working hours.
The rules also stipulate that companies will be rewarded if they adapt their recruitment and retention procedures to assist communities in accessing, obtaining, and retaining jobs. Burghart suggests this could lead to divisive identity politics within the private sector, potentially favoring certain groups over others in hiring processes. Additionally, businesses that 'co-design' their plans with 'community organizations' will receive preferential treatment, a practice Burghart likens to the politicization seen in police Independent Advisory Groups.
Burghart links these new measures to existing pressures on businesses, including a National Insurance hike, a business rates increase, and the Employment Rights Act, claiming these have already forced layoffs and business closures. He asserts that despite a change in Prime Minister, the Labour Party continues to prioritize the demands of trade unions at the expense of businesses and taxpayers.