ao link

Get updates from The Developer straight to your inbox Yes, please!

The price of everything and the social value of nothing

In the quest to quantify the outcomes of regeneration, we have put a price on everything, writes Steve Taylor. But what value are we creating? 

Linked InTwitterFacebook
For twenty years, weve been trying to quantify the value of improving neighbourhoods
For twenty years, weve been trying to quantify the value of improving neighbourhoods

From the living-room of my flat I can look into the windows of a boutique hotel that, in the terms of the original planning agreement, was designated as a block of social housing. Instead, the developer paid Southwark council £29m to be spent somewhere else in the borough.

 

One of the reasons councils find it difficult to maintain social value across their built environment is their dependency on private developers and external financing, which has burgeoned as a result of a relentless reduction in local authority funding from central government.

 

From the local authority perspective, the main mechanism for mitigating commercial developers’ inherent focus on profitability are Section 106 agreements that legally mandate certain social outcomes from a scheme. However, these can be parlayed into a financial contribution, a ‘Commuted Payment’, to be spent by the council on affordable housing elsewhere.

 

In 2018, an article in the Huffington Post reported that Freedom of Information requests had unearthed £375m of commuted payments sitting in the bank accounts of UK councils, with the highest individual figure, at £52.6m, being held by Southwark.

 

This is precisely how the city of Manchester has gone through a period of several years in which no social or affordable housing whatsoever was built in the city centre, despite the forest of cranes evidencing an orgy of residential construction.

 

“Healing a broken UK economy will take more than a glut of luxury apartments and upmarket shops – we can’t premise a recovery on selling each other lattes”

 

Although many councils told journalists Owen Bennet and Peter Hibberd that their banked Section 106 money had been earmarked for future housing schemes, some £204m had not been allocated to any specific project. The National Housing Federation responded to the figures by emphasising that “affordable housing should be delivered within new developments…rather than the money getting lost in the long bureaucratic process of allocating it for housing elsewhere.”

 

At a national level, it is possible to see in aggregate where Section 106 monies are targeted at delivering social value, and the picture is not one of enhancements to the public realm or grants to community organisations. Beyond social housing, the tendency has been for the money to be increasingly channelled into basic social provision that was previously funded from dedicated social spending budgets.

 

Developer contributions spent on education and transport and health by local authorities rose between 70% and 240% between 2016-17 and 2018-19, according to recent government’s 2020 accounts.

 

Contributions to health expenditure, the fastest growing recipient area, had to be extrapolated from the “other’ category; they had not previously been disaggregated due to an assumption that it was “not traditionally an area that was routinely funded through developer contributions.” It is now.

 

In contrast, government spending on public health in 2019-2020 was roughly in line with cash expenditure in 2013-14, according to a King’s Fund analysis. This translates into a reduction of almost 25% less per person, according to the Health Foundation.

 

When even the UK Green Building Council, a charity committed to “radically improve the sustainability of the built environment by transforming the way it is planned, designed, constructed, maintained and operated”, urges local authorities to “think strategically about which outcomes require binding commitments from the developer” and advises against “mandating all desired social value outcomes as part of a Section 106 agreement” it is clear that this mechanism is an unreliable way to secure social value from commercially-led developments.

 

A lone visitor to Hudson Yards in January 2021. Massimo Giachetti/Getty Images
A lone visitor to Hudson Yards in January 2021. Massimo Giachetti/Getty Images

 

It’s a situation made yet more precarious by the sweeping changes to the planning regime outlined by Housing Secretary Robert Jenkins in the August 2020 white paper Planning for the Future including the proposed dissolution of Section 106 and its replacement by an ‘infrastructure levy’ and a reliance on non-binding ‘planning conditions’. The white paper’s recommendations exist in such a provisional form that neither developers nor local authority planners can be clear about their implications for social value.

 

Meanwhile, the social value impetus in development continues to grow, as burgeoning societal pressure overtakes the requirements of ever-shifting legislation. In February 2019, during a Property Week panel discussion, David Partridge the joint CEO of Argent Related acknowledged that the need to generate social value was “a train coming down the track at us extremely fast.”

 

As head of a combined venture between UK’s Argent, responsible for King’s Cross, and US developer Related, responsible for New York’s Hudson Yards, the train Partridge sees coming is likely freighted with an explosive mix of anger at blatant inequality, fears of accelerating climate emergency, and at the displacement and exclusion of communities in the wake of regeneration.

 

In March 2019, Hudson Yards was described by New York Times architecture critic Michael Kimmelman as “a supersized suburban-style office park, with a shopping mall and a quasi-gated condo community targeted at the 0.1 percent… as if the peak ambitions of city life were consuming luxury goods and enjoying a smooth, seductive, mindless materialism.”

 

As Thomas Heatherwick, designer of Hudson Yards’ Vessel and King’s Cross shopping centre Coal Drops Yard, told the Daily Telegraph in 2019, “With the decline in other public gathering points, church, for example, or public libraries and community centres which aren’t being financed now, we need places to come for human interaction.” The Guardian architecture critic Rowan Moore summed up Heatherwick’s insight as “time to give up on civic life… let’s go shopping”.

 

Two years on, healing a broken UK economy from the combined ravages of coronavirus and Brexit will take more than a glut of luxury apartments and upmarket shops – we can’t premise a recovery on selling each other lattes.

 

Southwark has seen a net loss of over 5,000 social rented homes as a direct result of regeneration
Southwark has seen a net loss of over 5,000 social rented homes as a direct result of regeneration

 

“If you were to ask someone walking down the street ‘what do you think about the property industry?’ they would say stuff like ‘capitalism, aggressive, exploitative behaviour,’” Bill Hughes, head of real assets at Legal & General Investment Management admitted on that same panel discussion in 2019.

 

Repairing developers’ reputational deficit is one thing; changing organisational priorities and behaviours is something else entirely. It can be hard to distinguish whether PR or policy is at work in the growing number of social value commitments, though both industry and government appear to be shifting from arms-length ‘contributions’ to direct investment in educational, health and other social infrastructure; focusing, as Lendlease’s Asia CEO, Tony Lombardo puts it, on “value creation as opposed to philanthropic spend”.

 

Lendlease’s social value framework and tool for measuring project-level and business-wide social value are built by the ubiquitous Daniel Fujiwara. An economist at the London School of Economics and Political Science, Fujiwara’s research focuses on policy evaluation methods and techniques for valuing non-market goods. As an advisor to the UK government, Fujiwara has led various wellbeing strategies and provided input into the HM Treasury Green Book, which collates the department’s guidance on evaluating policies, programmes and projects.

 

A parallel shift can be detected in the Johnson government’s amalgam of diluted planning obligations with the pivot towards ‘conservative Keynesianism’ in its plans for post-pandemic economic reconstruction, featuring massive social spending on capital projects, the budgets for which will inevitably flow to the private sector, either wholesale or in the form of public/private partnerships. Social value will be attributed to the spend itself, rather than offset.

 

How did we get here? If the future of social value is privatisation by another name, powered by developers keen to regenerate their public image, its origins might be found in the pressure to demonstrate value for money in capital projects.

 

One place to start looking is the New Deal for Communities (NDC), introduced by the 1997-2010 New Labour government under Tony Blair and run between 1998 and 2008. The NDC was one of the most extensive, innovative and well-resourced Area Based Initiatives (ABIs) to have been attempted in the UK, a £1.71bn project to transform thirty-nine deprived neighbourhoods using placemaking and regeneration to address physical, social and economic problems in targeted cities and towns.

 

“When the UK government’s guidelines ‘required outcomes to be monetised and compared with costs’, the solution was ‘shadow pricing’ which places a monetary value on place- and quality-of-life-related outcomes”

 

In practice the NDC struggled to affect employment and education the target neighbourhoods, though they had a significant positive effect on health. Ever since the mid-1980s, the UK government had been trying to develop methods for evaluating ABIs in order to identify their impacts and draw lessons that could be applied more widely. These efforts were held back by a lack of funds (some ABIs ran out of money before they reached the evaluation stage) and the failure to develop adequate evaluation techniques, especially for appraising non-market outcomes.

 

The political importance and sheer scale of the NDC accelerated the need for more sophisticated evaluation methodologies to demonstrate that the programme represented value for money. Measuring social outcomes that do not have a market value presented problems within the UK government’s guidelines on evaluation, “which required outcomes to be monetised and compared with costs.”

 

The solution, which the government eventually explored in the context of the NDC in a 2010 research paper, was ‘shadow pricing’, which uses a range of techniques to place a monetary value on place- and quality of life-related outcomes. The report includes financial proxies for quality-of-life indicators from “feeling trapped in current accommodation” to people’s level of satisfaction with their GP.

 

Funding for the New Deal for Communities ended in 2011; by then the Cameron-Clegg coalition was in power; the year, according to Inspiring Impact, the output from a conference bringing together 30 leaders in the field of social impact measurement, marked “a key point in the history of social change”.

 

After a decade during which local government moved much of their funding from grants to contracts, from activities to outcomes, the gospel of measurement had gathered momentum; the coalition “accelerated this trend”, committing in its 2010 Spending Review to “pay and tender for more services by results.”

 

This sea-change underpinned the coalition’s launch of the Big Society, prime minister David Cameron’s project “to generate, develop and showcase new ideas to help people come together in their neighbourhood to do good things” - clearly, in those terms, something no reasonable person could object to.

 

From the remote perspective of twelve years later, the Big Society looks either hopelessly naïve, wilfully vague, or nothing more than a pabulum to civil society organisations already despairing at the pace of privatisation. Ostensibly aimed at devolving more power to communities, boosting the social enterprise sector, encouraging volunteerism and transferring power from central to local government, the Big Society arguably achieved none of those things and had effectively disappeared from the political scene by the 2015 general election.

 

“We don’t really have industry standards for what social value is. We account for things…but we don’t ‘count’ social value and, until we do, it is going to be very difficult to talk about in any reasonable way”

 

In spite of its short life, the Big Society incorporated a culture of impact measurement that provided the impetus for the Public Services (Social Value) Act 2012, which came into force on the 31st of January, 2013. The act has managed to survive and evolve since then as a putative corrective to a further, even more economically fundamentalist phase in the commercialisation and financialisation of UK public sector expenditure, epitomised by the Johnson government’s contentious outsourcing of the measures necessary to contain the COVID pandemic.

 

Having been monitored, reviewed, critiqued, extended and amended over its decade-long life, the Act remains in force, against the odds. From its origins as an instrument designed to dilute the dominance of private sector corporations in large-scale tendering for government business, the Act, and its underlying principle of social value, has expanded its range to cover broader aspects of delivery to “local authorities, acute trusts, clinical commissioning groups (CCGs), other NHS organisations, fire and rescue services, education and early years services, police, housing associations and government departments.”

 

The application of social value across these diverse sectors has been uneven; unsurprisingly given that until the 2018 extension of the Act, the only requirement was to “consider” its application. Some of the problems inherent in such a voluntarist approach were identified as early as February 2015 in a speech to Social Enterprise UK’s Social Value Summit by cross-bench peer Lord Adebowale, including his key observation that “we don’t really have industry standards for what social value is. We account for things…but we don’t ‘count’ social value and, until we do, it is going to be very difficult to talk about in any reasonable way.”

 

Shoreditch was among the 39 deprived communities targeted by the NDC. George Clerk/Getty
Shoreditch was among the 39 deprived communities targeted by the NDC. George Clerk/Getty

 

Adebowale’s comments were a precursor to the publication of Lord Young’s official review of the Act three months layer, which listed barriers to “fully develop the Act’s potential” that included; awareness and take-up, varied understanding, inconsistent practice, knowing how and when to include it in the procurement process, applying it within a legal framework and procurement rules, and how to measure it.

 

The original Act’s lack of prescriptiveness had evidently hobbled its effective implementation on more or less every front, not least in the lack of any common understanding of what was actually meant by ‘social value’.

 

The term ‘social value’ itself, although concise and apparently straightforward, is riddled with ambiguity, almost to the point of oxymoron. Value, values, valuation; the words might share the same etymological root but they inhabit very different moral, social and economic universes. The concept of value is itself fiercely contested by contemporary economists including Kate Raworth, Marianna Mazzucato and degrowth advocate Jason Hickel.

 

Neoclassical economists sought to reframe economics as a value-free science but, as Mazzucato points out, their model of the world is not only predicated on a specific theory of value, it also embodies a value system. Along with, it could be argued, a set of tools for valuation (cost-benefit analysis, to name just one).

 

Social Value emerged from the neoclassical economic underpinnings of conservative social policy, which had spent three decades wreaking enormous damage on UK communities by the time the Public Services (Social Value) Act became law.

 

Conservative MP Chris White, whose private members bill formed the basis of the Act, gave a speech to parliament at its second reading in which he declared “What I believe in is a future in which our public services are run by communities and the organisations close to them that have a sense of social responsibility and put people before profit.” What was to happen in public procurement six years later revealed how just much wishful thinking that statement contained.

 

“The strengthening of the Social Value Act was widely interpreted as a response to the narrowly-avoided apocalypse of the Carillion debacle”

 

Early in January 2018 Carillion, one of the UK government’s largest contractors, providing management services to the military, hospitals, courts, schools and big infrastructure projects, collapsed under a landslide of debt. 43,000 jobs were at risk, along with hundreds of subcontractors and smaller businesses.

 

The previous summer, Carillion had been ‘fighting for survival’ according to the Financial Times, its plummeting share price reducing the company’s market valuation to £250m against a pension deficit of £663m and net debt of £695m, even as the UK government continued to award it contracts.

 

Six months after Carillion went under, Theresa May’s Chancellor, David Lidington, announced an extension to the Social Value Act to “ensure all major procurements explicitly evaluate social value where appropriate, rather than just ‘consider’ it.” He conjured the image of a “responsible capitalism”, in which “businesses recognise the duties and obligations they have to wider society.” The strengthening of the Act was widely interpreted as a response to the narrowly-avoided apocalypse of the Carillion debacle.

 

Whilst the Act may function as a useful fig leaf for governments when the private sector fails to deliver, this hasn’t stopped the broader concept of social value propagating beyond the procurement of large government contracts, the focus of the original Act. It is possible that the Act’s laissez-faire approach to compliance encouraged a more diverse range of social and economic actors to get on board.

 

Housing associations, who were in the Act’s scope from the outset, initially found it hard to implement. Another 2015 government report, this time on the use of the Act in public health, noted that “although two thirds of housing associations and local authorities in one survey reported considering social value across all the services they commission, only 13% were “very satisfied” with their social value processes.”

 

As recently as November 2019, a pointedly-titled IPPR report, Valuing More Than Money: Social Value and the Housing Sector, noted that “the Social Value Act’s focus on procurement means that many of the wider housing-specific considerations related to, for example, investment, planning decisions, procurement of construction works, land asset disposal and the operational phase of development, are technically out of scope.”

 

It also reported that “a significant minority of housing associations are not engaging with the act, despite it being a regulatory requirement for them to do so.”, concluding that the Act was in need of yet further strengthening, post-Lidington.

 

“With the Social Value Act apparently still lacking teeth, businesses involved in the built environment but outside of its remit have taken up the social value cause”

 

With the Act apparently still lacking “the teeth necessary”, in Lord Adebowale’s words, businesses and civil society organisations involved in the built environment but outside of its remit have taken up the social value cause.

 

Many regard social value as an integral part of a drive towards sustainability in the face of climate emergency. Interrelated issues include widening inequality, endemic poverty and political polarisation making it harder for commercial entities in particular to maintain a belief that the singular pursuit of profits will have the benign side-effect of maintaining social value, let alone enhancing it.

 

As a result, social housing providers, commercial developers, local authorities, architects, academics and industry bodies such as the RIBA and the UK Green Building Council have increasingly taken up the initiative.

 

HACT, the housing sector innovation agency, has been championing social value in social housing for the past decade, with a consistent focus on developing methodologies, metrics and tools for measuring what was initially referred to as ‘social impact’ or ‘social valuation’ before social value became the preferred term.

 

Much of HACT’s work in this space has been developed in collaboration with Fujiwara. Since 2014 HACT and Fujiwara have been assembling the Social Value Bank, which the agency describes as “the largest set of methodologically consistent social value metrics ever produced”. The Bank can function as a stand-alone way of measuring social impact, work as a valuation model that feeds into broader measurements such as Social Return on Investment (SORI) and is available, as a suite of free-to-use tools, to organisations like housing associations. It’s been widely used across the social housing sector.

 

Calling it a bank - as in seed bank - makes sense; however, the word also unwittingly evokes the culture of valuation in which it has been developed, one that is perhaps best encapsulated in the term ‘monetisation’. ‘Monetised values’ are financial proxies for social impacts and are seen as the most useful way to create a level playing field for measuring all the impacts of a project, say a housing scheme, around a common metric.

 

“Hyde Housing have calculated that the average social value of each of their tenancies in 2019-20 was £13,682, made up from proxies such as a reduction in unemployment and less exposure to crime”

 

The monetising methodology, often described as a business model approach, is the dominant mode of social impact measurement across UK government, civil society and, increasingly, the built environment. Things that aren’t directly bought and sold in the process of delivering a project, so-called ‘non-market goods’, are ascribed a monetary value – a financial proxy – in the applicable currency.

 

Affordable housing specialists Hyde Housing have calculated that the average social value of each of their tenancies in 2019-20 was £13,682, made up of: reductions in unemployment, absenteeism and presenteeism; improvements in physical and mental health; reduced involvement in, or exposure to, crime; local authority savings on social provision; fewer claims on Universal Credit; increased involvement in education; less debt and fewer domestic fires. These are relatively easy proxies to establish using government-produced data to calculate a nominal unit cost per saving; for each person who comes off Universal Credit, or for every time a fire brigade call-out is avoided, for instance.

 

Monetisation becomes more problematic when applied to less tangible, and therefore less measured and recorded, areas of wellbeing or to those aspects of the wider hinterland around a project that, although they have palpable effects on people, are usually treated as ‘exogenous’, coming from the outside, and therefore beyond the scope of an analysis rooted in costs or proxies.

 

Foot in the Door, a joint project between the Welsh film board, Ffilm Cymru, and several Welsh housing associations including Charter Housing aims to create social value by training and offering work experience in the film and television industries to people from disadvantaged communities. On one level, the social value of transitioning someone into paid employment is easy to measure in terms of the social costs that are saved; it is less easy to quantify the social value generated by some of the initiative’s qualitative goals like enhanced confidence, social mobility and role-modelling.

 

Nevertheless, methodologies have been developed for integrating these ‘wellbeing’ impacts into social value evaluations, originating in the application of cost-benefit analysis to social value in the ‘welfare economic theory of value’ developed by Nobel Prize winning economist John Hicks and his colleagues in the 1930s. Crudely summarised, it relied on asking people in surveys what they would be prepared to pay for a particular ‘good’; the putative price being equated to the ‘value’ of that good.

 

Over time, a number of problems with this approach became evident, not least the issue of “miswanting”, a desire for things that will not in fact make us feel better and a lack of desire for things that will - surely a syndrome most of us have fallen prey to at some time. A more recent alternative is the Wellbeing Valuation approach, which relies on people self-reporting their levels of wellbeing to generate data that is “based on real experiences and not…on people’s imaginations of how they will be affected by change.” This updated methodology is now integrated into HM Treasury Green Book cost-benefit analysis.

 

Isos Housing, a group of housing associations and commercial housebuilders based in the North East, applied monetised wellbeing metrics to account for the social value generated by Back in the Game, a joint initiative between them, Sunderland AFC Foundation of Light and the Newcastle United Foundation to improve the fitness and skills of, and help find work for, sixty adult unemployed Isos residents.

 

Over a three-month phase of the initiative, the Social Return On Investment (SROI) was calculated as: 5 people helped into employment at £8,700 each, total £43,500; 27 people with “raised career aspirations” at £4,800 each, total £129,600; 32 participants with increased fitness levels at £2,354 each, total £75,328’; 24 people “improved their self-confidence” at £1,195 each, total £28,680; and 27 people who gained a certificate in work skills at £947 each, total £25,569.

 

“Economic growth acts as both an ultimate rationale for developers’ projects and as a benefit to the ‘community’ impacted by a scheme, conventionally expressed in terms of the number of jobs and apprenticeships created”

 

Since its creation in 1999 by pioneering San Francisco Bay area philanthropic organisation the Roberts Enterprise Development Fund, SROI methodology has been widely disseminated and developed on both sides of the Atlantic, using a growing body of research and case-studies to continually boost the accuracy of financial proxies.

 

Having been actively promoted in the UK since the late 2000s by the New Economics Foundation, SROI now forms the foundation of many government and local authority policies aimed at generating social value, as well as being the basis for HACT’s Social Value Bank and the National TOMS (Themes, Outcomes & Measures) Framework developed by a partnership between the Local Government Association, the LGA’s National Social Value Taskforce and the Social Value Portal, a commercial provider of evaluation services and toolkits. TOMS is increasingly being used by local authorities for procurement and was expanded with a Real Estate plug-in in 2019.

 

Gradually, this plethora of methodologies, metrics and tools has worked its way into the industries that are responsible for our built environment, starting with the straightforward application of social value methodologies to construction procurement. Key to the subsequent extension of its reach into the closely associated areas of planning and land disposal has been the work of the UKGBC.

 

The UKGBC has been producing some of the most detailed, forward-facing advice in the sector, and, according to Building Design’s social value columnist, architecture professor Flora Samuel, will publish in March 2021 further definitive guidance informed by Kate Raworth’s Doughnut Economics framework for sustainable living within “social and planetary boundaries”.

 

Samuel is also the lead author of the RIBA’s Social Value Toolkit for Architecture, which features a quotation from Marianna Mazzucato as its frontispiece - “If we cannot define what we mean by value, we cannot be sure to produce it, nor to share it fairly, nor to sustain economic growth”. In a stinging introduction to the Toolkit, former RIBA president Ben Derbyshire berates the profession for what he sees as a cavalier attitude towards social value; “Architects do little to obtain feedback on the outcomes of their work and are shockingly ignorant of the impact they have on communities.”

 

Later in his introduction Derbyshire throws RIBA’s hat into the ring marked ‘monetisation’; “What is needed is a methodology for translating the social value of design into a format that can be used in economic models.” It is significant that the quotation from Mazzucato chosen to preface the document includes an implicit imperative to “sustain economic growth”.

 

Unless they are designing purely government, council or community funded projects, architects are bound by financial necessity to work with developers in order to get their designs built. Economic growth acts as both an ultimate rationale for developers’ projects and as a much-promoted benefit to the ‘community’ impacted by a scheme, conventionally expressed in terms of the number of jobs and apprenticeships created.

 

Cash-strapped local authorities, competing cities and regions have all been drawn inexorably, along with architects and developers, into circuits of investment capital looking for new opportunities for growth. Conventional social-value-accounting draws social actors and organisations, charities and communities into those same circuits.

 

“Economic growth acts as both an ultimate rationale for developers’ projects and as a benefit to the ‘community’ impacted by a scheme, conventionally expressed in terms of the number of jobs and apprenticeships created”

 

Proponents of social value operating within a dominant culture of financial evaluation have found it necessary to translate social benefits into their monetised equivalents in order to have them acknowledged, pressure that has often relegated social value to a position of playing catch-up. The pressure to monetise has created an uneven playing field on which social value needs to prove itself according to criteria that may be antithetical to its purpose and meaning, which are unfairly weighted from the outset.

 

A housing project may seek to enhance people’s mental wellbeing by giving every tenant a window onto nature from their living-room. Whilst the costs - of producing and installing the widows - are relatively easy to account for, it is much harder to demonstrate causality between the emotional benefits of a lovely view and data on local mental health expenditure and to quantify directly the resultant savings.

 

It is arguable that, however sophisticated the process of creating financial proxies has become, the scope for collapsing the qualitative into the quantitative has a finite limit. Beyond that, even where it is feasible to assess impact as measurable and attributable outcomes, value is a matter of judgement, an opinion about what is important. Not all social impacts are of equal ‘value’, at least when it comes to the ethical meaning of that word.

 

Fortunately, a number of recent developments are acting to transform this state of affairs, one of the more influential being widespread adoption of the UN’s seventeen Sustainable Development Goals since their launch in 2015. Whilst one of the founding pillars of the UN’s concept of sustainable development is the familiar trope of ‘economic growth’, the goals seek to reconcile this with ‘social inclusion’ and ‘environmental protection’, stating that “these elements are interconnected and all are crucial for the well-being of individuals and societies.”

 

A prominent example, The Social Value Model, a comprehensive manual for government procurement updated in December 2020 to incorporate COVID-recovery initiatives, explicitly links to the UN goals; one of its five overarching themes is ‘Fighting climate change’. The UK Green Building Council responded to its publication by highlighting its importance to the sector; “For the construction and property industry this new model will have a material impact on how the built environment sector bids for central government contracts.”

 

“Do social value and its close relative, sustainability, always need to be served with a side order of economic growth and a saucing of financial uplift in order to be palatable, let alone desirable?”

 

Similarly, environmental protection is core to the work of the UKGBC itself. One of the most potentially transformative aspects of its mission is the way its overarching sustainability goals (the built environment is responsible for a whopping 42% of the UK’s carbon footprint, after all) are closely integrated with socio-economic impact, resource usage, wellbeing and biodiversity. Interrelated cross-sector initiatives are embedding environmental responsibility into the business of building; HACT, for social housing, the Construction Innovation Hub, the expansion of BREEAM standards to the whole lifecycle of buildings including refurbishment, the government’s own recent Construction Playbook.

 

Even where sustainability goals are not explicitly embraced, their influence can be felt. Research indicates that BREEAM certified buildings, for instance, outperform their non-certified competitors in both on asset value and rental rates. Initial construction costs are more expensive, but only by a factor ranging from 0.17% to 0.75%; operational savings over the lifecycle from the reduced cost of energy and other services more than compensate.

 

But do social value and its close relative, sustainability, always need to be served with a side order of economic growth and a saucing of financial uplift in order to be palatable, let alone desirable?

 

There are variants on the growth imperative designed to bring it into alignment with more humanistic measures of progress, including ‘sustainable growth’ and ‘inclusive growth’, focusing respectively on environmental maintenance and repair, and social deprivation and exclusion. The growing adoption of inclusive economy principles across local government aims to ensure that economic development benefits “all residents, including those who have been historically cut off from the proceeds of growth.”

 

Commissioning and procurement are seen as the main levers for achieving this; Manchester City Council for example, while monitoring social value with help from the Centre for Local Economic Strategies (CLES), reported an increase in local expenditure from 51% to 70% in 2018/19, an additional £318m of council spend hitting the local economy.

 

Social value generation has been less easy to discern in the city’s recent efforts in construction, with a lamentably low number of affordable homes built. Increased local spending “helps support” 561 apprenticeships, 1,579 jobs and 7,730 employment opportunities for hard-to-reach individuals, but the social value generated is significantly undermined if those people cannot afford to live in the city or are forced into long, draining commutes from cheaper peripheral locations in order to access those opportunities.

 

As long as measurement of social value is forced into the economist’s straightjacket of cost-benefit analysis, such disconnects will persist. The alternative is to ask what outcomes people and communities actually want to see, to incorporate their own experiences and perspectives, increase the weighting of qualitative outcomes and wrap up data in narratives that show, holistically, how the pieces fit together. We loosen the constraints of monetisation by mitigating the fixed sense of value as a noun; switching focus to its role as an active verb – to ‘value’ – measuring what people impacted by changes to their built environment consider important or beneficial.

 


Festival of Place: Social Impact runs 22-26 March online and takes an inspiring look at how professionals can make a positive impact on places through their work. Find out more

Linked InTwitterFacebook

Sign up to our newsletter

Get updates from The Developer straight to your inbox


© The Developer 2020 - Tweak Ltd., Kemp House, 52 - 160 City Road, London, EC1V 2NX. Tel: 020 7772 8384