Government moves to promote social value in public service contracts should be strengthened, the national body for social enterprise has said.

Following today’s launch of the Government’s Social Value Act, public bodies – including councils and health commissioners – will now be obliged to consider commissioning services from organisations which deliver social and environmental benefits for communities as contracts are delivered.

However Social Enterprise UK has said that public sector spending could be used more effectively if a consideration of social value was instead made into a legal requirement.

Welcoming implementation of the Act, experts have said that the measure could support social enterprises and charities which remain capable at reinvesting their profits in a positive fashion yet are often sidelined by larger service providers.

Social Enterprise UK’s chief executive, Peter Holbrook, said: ‘This law, if strengthened, has the power to improve standards across the board as private companies will also come under pressure to deliver social value to win contracts.’

‘The Government needs to put its full weight behind the Social Value Act and help local commissioners embrace this armoury. It’s imperative they get to grips with what they need to do to comply with it so that our public sector spending can be used as a force for good.’

Chief executive of the National Council for Voluntary Organisations, Sir Stuart Etherington, said: ‘This little gem of an Act has the power to radically transform our public services. It gives commissioners the green light to take into account the extra value charities bring.’