Firms seeking work on major infrastructure schemes will need to set out plans to boost local jobs and skills under a tightening of procurement rules to be considered by the government.
Ministers are to consult on proposals that would see companies bidding for road, rail, hospital and school building contracts required to demonstrate that they can “create opportunity and growth” in local areas.
The announcement comes ahead of the release of the government’s 10-year infrastructure strategy later this week.
Plans have already been unveiled for the launch of a £7.9bn flood defence programme designed to protect hundreds of thousands of homes over the next decade.
An extra £590m has also been committed to the long-delayed Lower Thames Crossing, alongside £1bn for repairs to roads, bridges and tunnels across the country.
Under the new procurement rules, which will form part of the infrastructure strategy, plans for high-quality jobs and improved skills in local communities would be “key requirements” for firms hoping to land major contracts.
Pat McFadden, chancellor of the Duchy of Lancaster, said firms that “put money in working people’s pockets” would be favoured under the new arrangements.
“Whether it’s building roads, railways or schools, we want to open up opportunities on major infrastructure projects for firms that boost British jobs and skills,” he said.
“The new rules will deliver on our Plan for Change by rewarding companies that put money in working people’s pockets as we invest in the country’s future.”
In February, the Cabinet Office published fresh guidance on the process by which public bodies should take account of social and economic benefits when assessing bids for central government work.
But while that document set out an expectation that bodies would seek to promote wider social and economic value when awarding work, the changes now under consideration would make this a mandatory requirement on all major new contracts.
Public bodies would have to “give more weight” to firms that show they would boost British jobs and skills in their bids for contracts, the Cabinet Office said.
The changes, which are expected to apply to major government projects including transport investments, schools and hospital building schemes, will also reward suppliers able to prove they can deliver benefits “targeted to the specific needs” of a community.
A firm bidding for work on a road building project, for example, would be asked to show plans for apprenticeships, T-level industry placements, opportunities for care leavers, or helping people get into work and stay in work in the local area.
“In the past companies have made pledges when they are bidding for a contract but don’t always follow through,” the Cabinet Office said.
“Under these plans, we will make sure that companies deliver their promises on skills, jobs and local opportunities.”
It also promised a “new, simpler approach to social value” for public bodies to use with clearer rules on monitoring the extent to which suppliers were delivering on contract requirements.
The consultation will be published in due course, the Cabinet Office said.
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Kerry Lorimer