How are local procurement teams responding to the cost of living crisis?

Residents across the UK are facing unprecedented pressures on their day-to-day lives, be it from spiralling energy prices, surging inflation or the effects of strike action.

Procurement teams across Local Government are being mobilised to deliver much-needed support for their residents, turning to private sector expertise to roll-out innovative solutions under challenging circumstances.

Using Tussell's procurement intelligence platform, we've been tracking the tendering and contracting activity of local authorities to see how they're taking action in the face of the cost-of-living crisis.

NB: Our latest cost of living analysis - covering contracts and tenders released by Local Government between September and October 2022 - is now out: access it here! 

The big picture

The causes of the cost-of-living crisis are multifaceted. While immediate, short-term responses are needed, councils have also looked to the long-term to address some of the underlying contributors and effects of rising prices.

In this article, we look at three broad areas: improving energy efficiency; addressing food insecurity, and tackling income inequality.

Improving energy efficiency

Local councils have been ramping up efforts to make homes and businesses more energy efficient, thereby helping to reduce energy bills.

Q1 of 2022 saw the highest ever number of energy-efficiency related contracts being awarded by local authorities, at 56.*

The Tussell platform shows that since the beginning of 2022, local authorities have awarded at least £155.4mn worth of insulation and energy efficiency-related contracts, and £1.1 billion since 2016.

* The contract keywords included as part of this search were: "insulation", "double glazing", "energy efficiency", "energy efficient", "heat pump", "retrofit" and "heat network". Only publicly-published contracts classified as 'Works', 'Products' or 'Not specified' were included. The total number of such contracts awarded in Q2 2022 may be artificially low due to a lag in publishing the award notice; Q3 2022 figure is accurate as of 31/08/2022.

Examples of such contracts includes Staffordshire County Council's procurement of LED lightbulbs in August, to be delivered to a variety of homes for persons and families on low incomes to "assist with the cost of living rise in 2022."

Bedford Borough Council also went out to tender for a Warm Homes in Bedford Borough service in late August. The phone and webpage based service aims to "tackle cold and damp homes arising from fuel poverty and fuel stress" by providing targeted lower- and higher-cost interventions to address energy efficiency within homes.

Meanwhile, Oxfordshire County Council sought a supplier back in April to provide services pursuant to funding awarded under the Home Upgrade Grant Scheme, namely to undertake "home energy retrofit and renewable energy installations to residential properties in fuel poverty across Oxfordshire".

The West of England Combined Authority concluded a similar search at the end of September, in which it sought suppliers to apply for funding provided under the Sustainable Warmth Competition for "the installation of insulation and other energy efficiency measures".

Addressing food insecurity

Rising prices are leaving a growing number of residents unable to afford enough food to properly feed themselves or their families.

From January 2021 to August 2022, 19 food poverty or food bank-related tenders and PINs were published by local authorities.**

Some of these sought to provide more immediate assistance to struggling residents. In June 2022, for example, Gloucestershire County Council launched a £20 million single supplier framework with Auriga Services Ltd, to distribute food vouchers, utility vouchers, emergency payments and other support.

Others looked to address the more underlying, longer-term causes of food inequality in the local area. In March, the Royal Borough of Kensington & Chelsea tendered for a third sector provider to take the lead on its 'Partnership approach to Food Insecurity in Kensington and Chelsea', "to support users of emergency food provision to access the services that will reduce or eliminate their need to use them."

The London Borough of Barking & Dagenham similarly went out to tender earlier this year for a supplier to support the development of the Council's Good Food Economy Plan. The Plan, in part, aims to "build a healthier, more affordable, more sustainable local food system", helping to tackle high levels of food insecurity in the borough.

** The contract keywords included as part of this search were: "food insecurity", "food poverty", "foodbank" "food banks", "foodbank" "food bank", "food-bank", "food-banks", "food security", "food vouchers", "food voucher", "supermarket coupon", "supermarket coupons", "food support", "meal voucher", "meal vouchers", "food inequality". Non-relevant tenders were manually excluded. Only covers publicly-published tenders and PINs. Covers period 01/01/2021 - 01/09/2022.

Tackling income inequality

The rising cost of living has exacerbated pre-existing inequalities in people's finances. Some local authorities have started looking for ways to address this deeply rooted issue.

Essex County Council, for example, recently tendered for the provision of "9 accredited Coaching and/or NLP trained specialists to work on a pilot programme aiming to support people [to] improve their financial wellbeing".

Back in February, Bath & North East Somerset Council awarded a £270,000 contract to Bath & District Citizens Advice Bureau to deliver financial wellbeing outcomes for local residents through the provision of advice and information on debt, budgeting and financial management and the "maximisation of income.

Finally, as part of the Household Support Fund 2 (HSF2) - a DWP financial support package provided to local authorities to be distributed to different categories of vulnerable residents - North Northamptonshire Council released a PIN back in May 2022 to express interest in finding a supplier to assist the council distribute funds to "the 3rd category" of targetted support, "'households evidencing financial hardship".

The Council is seeking an organisation "who can operate, on behalf of the Unitarys, in distributing HSF funds", "in the first instance to smaller and bespoke voluntary and charitable organisations, and thereafter directly to residents who meet the HSF criteria".

Digging into the data.

A number of local organisations have published tenders or awarded contracts specifically in response to the cost-of-civing crisis.

Using Tussell's procurement intelligence platform, we've picked out a handful of notable examples:

⚪ Energy Helpline - Pre-Information Notice, Milton Keynes Council

Other authorities are planning introducing dedicated helplines to provide advice and support to its residents.

Towards the end of August, Milton Keynes Council released a PIN to gather expressions of interest to supply an Energy Helpline.

The 12-month Helpline - scheduled to commence this month - will aim "to improve the wellbeing of residents experiencing crisis of exceptional hardship relating to energy / fuel poverty, particularly warmth as we approach the winter period".

The Council expects around 10-15% of those who contact the Helpline to require direct support and advice or referral to the Council; of these, it foresees around 1000 households requiring intensive interventions.

🔵 Affordable Warmth - Tender Notice, London Borough of Brent

In a similar vein, Brent Council went out to tender for an energy support service back in July.

The service will provide "energy advice and support to residents who have been identified as experiencing or at risk of experiencing fuel poverty".

🔵 GB-London: Cost of Living - Tender Notice, Local Government Association

Pooling knowledge is always important, but this is especially so during a time of crisis.

This is the thinking underpinning the LGA's recent publication of a tender to produce an evidence base of what councils are doing to support people through the cost of living crisis.

As Emily Hacket - Public Health Adviser at the LGA - explains: "the purpose of this case study resource is to share best practice and help councils to support their residents with the rise in the cost of living. The resource will highlight positive examples and promote information sharing and ideas generation".

The case studies archive - which the LGA aim's to have live on their Cost of Living Hub in November 2022 - will span areas like "health, debt, financial inclusion and income maximisation, food insecurity, energy" and more, with each case study demonstrating "how the themes identified tie into the council's wider strategic approach to the rising cost of living".

🔴 Warm Hubs in Winter - Contract Award, South Cambridgeshire District Council

Warm Hubs are designated public spaces that provide warmth and security to anyone who needs them.

With the prospect of many residents not being able to afford to keep their homes heated this coming winter, a number of local authorities have introduced plans to roll-out Warm Hubs across their constituencies. One such authority is South Cambridgeshire District Council (SCDC).

SCDC went out to tender for a Warm Hubs supplier in early August, to create a network of volunteer-led spaces across South and East Cambridgeshire that would "offer a warm, friendly and inclusive environment" and "information of how to reduce bills, access financial support, and stay healthy and well".

The £119,000 contract was awarded to local charity Cambridgeshire ACRE later in the month, which will last until March 2023.

*

The rising cost of living is placing many residents under tremendous strain. Harnessing expertise and resources from the private sector through public procurement is just one of many ways local authorities are responding to these unprecedented times.

If you're part of a Local Government procurement team and would like to learn more about how other local authorities are harnessing Tussell to procure more smartly, book a personalised demo of the platform with our team.

Don't miss out on all of our upcoming public sector-focused content: subscribe to our newsletter for public procurement professionals.

NB: Our latest cost of living analysis - covering contracts and tenders published from September to October 2022 - is now out: access it here!