Government contracts to require job creation instead of green targets under new rules

The UK government is set to revise its procurement rules, prioritizing job creation over environmental targets when awarding public contracts. Ministers plan to double the weight given to whether companies will help reduce the number of young people not in education, employment, or training (Neets) and boost regional growth. This move aims to simplify the process for small businesses and ensure taxpayer money benefits local communities.

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Every pound of taxpayer money should be spent in a way that benefits local communities – creating good jobs and giving young people the skills they need for the future.

Currently, government contracts account for approximately £90 billion of annual spending. Under the new measures, the social value consideration in contract decisions, which currently stands at 10%, will increase to 20%. However, the focus will shift from general social and environmental well-being to securing contracts with companies that offer jobs paying above minimum wage, provide training, or address local skills gaps. Contracts valued below £1 million will be exempt from this requirement, a change intended to make it easier for smaller firms to compete.

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For too long, securing government contracts has been a tick-box exercise that fails to deliver the positive change that people feel in their pocket and see in the places they live.

Louise Haigh, the first secretary of state, stated that the new rules will ensure that the £90 billion spent annually through government contracts supports British jobs, skills, and people across the country. She criticized the previous system as a "tick-box exercise" that often failed to deliver tangible positive change for communities. The government hopes this recalibration will stimulate employment and economic activity, particularly among younger demographics.

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We are doing things differently. These new rules will ensure the £90bn that is spent each year through government contracts supports British jobs, skills and people in every postcode.

However, the proposed changes have drawn criticism from environmental and green campaign groups. Greenpeace UK and Friends of the Earth argue that job creation should not be a trade-off with environmental protection. They contend that companies should remain accountable for environmental targets and that safeguarding the environment and creating good jobs are mutually beneficial goals. These groups highlight the ongoing environmental challenges, such as record heat-related deaths and the decline of the natural world, emphasizing that environmental action should not be compromised.

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Protecting the environment and helping young people into good work are mutually beneficial and one shouldn’t come at a cost to the other.