Mandatory requirement to prepare a Social Procurement Strategy
The Social Procurement Framework requires all departments and agencies to develop a Social Procurement Strategy.
To satisfy this requirement, the core components of a Social Procurement Strategy may be incorporated into a departmental or agency procurement strategy or set out in a standalone document.
The Social Procurement Strategy, or the relevant components of a departmental or agency procurement strategy, must be approved by the Accountable Officer or delegate.
Phased introduction of Social Procurement Strategy
The requirement to develop a Social Procurement Strategy will be introduced in two phases:
Phase 1
Applicable entities:
- Victorian Government departments and the following agencies:
- VicRoads
- Victoria Police
- Public Transport Victoria
Each of these organisations must submit a draft Social Procurement Strategy to the Department of Treasury and Finance by 1 September 2018.
The Department of Treasury and Finance will provide feedback on draft Social Procurement Strategies prior to these organisations finalising their respective strategies.
Social Procurement Strategies must be reviewed, updated and submitted to the Department of Treasury and Finance by 1 September each subsequent year.
Phase 2
Applicable entities:
All other agencies subject to the Standing Directions 2018 under the Financial Management Act 1994 (Vic).
Draft Social Procurement Strategy: Each of these organisations must submit a draft Social Procurement Strategy to the Department of Treasury and Finance by 1 September 2019. However, these organisations are strongly encouraged to become ‘early adopters’ by submitting their Social Procurement Strategy prior to this deadline.
The Department of Treasury and Finance will provide feedback on draft Social Procurement Strategies prior to these organisations finalising their respective strategies.
Social Procurement Strategies must be reviewed, updated and submitted to the Department of Treasury and Finance by 1 September each subsequent year.
All other mandatory requirements apply from 1 September 2018
The phased introduction applies only to the mandatory planning requirement for departments and agencies to develop a Social Procurement Strategy.
All other requirements established by the Social Procurement Framework apply to the procurement of all goods, services and construction undertaken by, or on behalf of, departments and agencies from 1 September 2018.
Developing a Social Procurement Strategy
The Social Procurement Strategy must:
- outline the organisation’s business strategy (including strategic priorities and objectives), procurement profile and social procurement opportunity analysis
- clearly articulate the social and/or sustainable procurement objectives that the organisation will prioritise in its procurement activities for the coming year (i.e. which of the objectives identified in Tables 1 and 2 of the Social Procurement Framework the organisation will prioritise)
- establish roles and responsibilities to ensure compliance with Social Procurement Framework requirements
- incorporate social procurement into the organisation’s capability development planning
- incorporate social procurement into the organisation’s supplier engagement planning / develop a supplier engagement plan that incorporates social procurement
- incorporate a reporting and management framework to monitor progress and performance, promote continuous improvement and review the Social Procurement Strategy
These core components ensure that departments and agencies:
- comply with mandatory planning requirements under the Social Procurement Framework
- demonstrate clear leadership and governance in relation to social procurement and manage internal expectations about delivering social and sustainable outcomes through procurement
- prioritise social and/or sustainable objectives in order to focus energy and resources, guide government buyers in respect of individual procurement activities, and enable a clear market signal to be sent by Government. A high-level summary of the social and sustainable procurement objectives being prioritised by departments and agencies in their Social Procurement Strategies will be published on this website
- manage supplier and stakeholder relationships regarding changing Government expectations and supplier requirements
- embed social procurement throughout the organisation’s procurement process, by building social procurement capability to enable the organisation to undertake, measure and report on social procurement initiatives
For Social Procurement Strategies developed by Phase 2 agencies, the level of detail expected in relation to each core component will depend on the organisation’s total annual procurement spend and the value of its individual procurement activities.
Social Procurement Strategy Templates
Social Procurement Strategy templates provide example headings and instructions for each section of the Social Procurement Strategy. The templates are designed to ensure that the core components listed above are covered and increase consistency across Government.
All Phase 1 departments and agencies must use the Social Procurement Strategy (Long form) Template.
For Phase 2 agencies, the following flowchart determines which Template Social Procurement Strategy must be used:
The diagram shows a flow chart that determines for Phase 2 agencies which Template Social Procurement Strategy must be used.
The agency will be in Group 4 if it follows the policies and practices of a lead department. Group 4 agencies may use the Social Procurement Strategy Adoption Template.
All other agencies will be in either Group 1, Group 2 or Group 3.
The agency will be in Group 1 if:
- it has a total annual procurement spend at or above $10 million (exclusive of GST); and
- any regional procurement activity is valued at or above $1 million (exclusive of GST) or any metropolitan or State-wide procurement activity is valued at or above $3 million (exclusive of GST).
Group 1 agencies must use the Social Procurement Strategy (Long Form) Template.
The agency will be in Group 2 if they meet one of two scenarios:
- first, the agency has a total annual procurement spend at or above $10 million (exclusive of GST), and all regional procurement activities are below $1 million and metropolitan or State-wide procurement activities are below $3 million (exclusive of GST); or
- second, the agency has a total annual procurement spend below $10 million (exclusive of GST), and any individual procurement activity is valued at or above $50,000 (exclusive of GST).
Group 2 agencies must use the Social Procurement Strategy (Short Form) Template.
The agency will be in Group 3 if:
- it has a total annual procurement spend below $10 million (exclusive of GST); and
- all procurement activities are valued below $50,000 (exclusive of GST).
Group 3 agencies must use the Social Procurement Commitment Template.
Social procurement self-assessment for departments and agencies
Departments and agencies should complete a social procurement self-assessment on an annual basis, in the course of developing its Social Procurement Strategy. The self-assessment should be submitted to the Department of Treasury and Finance as an addendum to the Social Procurement Strategy. The self-assessment must be:
- carried out by an assessor with appropriate expertise and knowledge of the organisation’s procurement function (for example, a Chief Procurement Officer or internal procurement unit)
- approved by the Accountable Office or delegate
The Social Procurement Self-Assessment Template has two components:
- Part A contains ten items, which are framed as positive statements. For each item, the assessor must determine the extent to which they agree or disagree with the statement by placing a ‘tick’ in the appropriate column.
- Part B contains a free text box, in which the assessor completes a high-level progress statement based on the responses to Part A. The statement should summarise the organisation’s progress toward operationalising the Social Procurement Framework and be no more than 250 words in length.
The responses to the Social Procurement Self-Assessment Template Part A will chart the organisation’s progress toward operationalising the Social Procurement Framework. In early stages of implementing the Social Procurement Framework, it is expected that many responses to the Social Procurement Self-Assessment Template Part A will be ‘Neutral’, ‘Disagree’ or ‘Strongly disagree’. Over time, however, each Social Procurement Strategy should move the organisation closer to a ‘Strongly agree’ response for all items, but focussing on:
- raising awareness and shifting mindsets
- building social procurement capability
Where the response is ‘Unknown’, it is expected that departments and agencies will take steps to ascertain the current situation and update the Social Procurement Self-Assessment Template Part A response as soon as practicable.
Tools and support
Browse directories of social benefit suppliers to support your social procurement activities.
This content on this page is taken from the Social Procurement Framework – Buyer Guidance – Guide to planning requirements. Access a PDF version in the social procurement document library.
For more information about social procurement, please contact the Social Procurement team.
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