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Birmingham Council tells firms: accept social responsibility if you want our business

Birmingham Council tells firms: accept social responsibility if you want our business

🕔15.Apr 2013

counhouseFirms supplying goods and services to Birmingham City Council must comply with new guidelines that include paying staff the Living Wage, recruiting workers locally and committing to the green agenda.

Announcing details of a Business Charter for Social Responsibility, council leader Sir Albert Bore listed six principles that most companies wishing to trade with Britain’s largest public body will have to follow.

They are:

  • Provide jobs and training opportunities for local people, targeting areas of high unemployment.
  • Buy goods using the Birmingham supply chain whenever possible.
  • Play an active role in Birmingham’s community support organisations.
  • Support staff development and welfare and adopt the Living Wage pay rates.
  • Commit to protect the environment, minimise waste and energy consumption.
  • Commit to employing the highest ethical standards in their own operations and those within their supply chain.

The attempt to pin down suppliers of goods and services with such a wide-ranging charter is believed to be a first for any UK council. Sir Albert said the aim was to use the city’s £1 billion annual procurement budget “work as hard as possible” by creating local jobs and boosting skills.

Signing up to the charter will be mandatory for firms wishing to bid for contracts above £500,000.

Sir Albert added: “These measures will ensure that more money is recycled within the local economy than at present, which is vital as we seek to tackle inequality and as we attempt to escape the dire economic situation the city faces.”

Sir Albert admitted that it would be unlawful to force existing suppliers to approve the charter, although they would be encouraged to do so. Amey, which runs Birmingham’s £3 billion highways private finance initiative, has already signed up.

One of the key measures, creating employment for local people, will involve firms wishing to do business with the council being invited to log in to the council’s Find it in Birmingham website, which features details of more than 8,000 firms in the city.

However, the cabinet member for Commissioning, Contracting and Improvement, Stewart Stacey, accepted that companies could not be forced to buy goods locally if they concluded that a better deal could be obtained elsewhere. He also pointed out that the council could not positively discriminate in favour of local firms when awarding contracts.

Cllr Stacey said: “We can’t specify where companies come from, but what we can do is give every opportunity for Birmingham companies to bid for contracts with the council.

“We can’t actually say ‘you will use local sub-contractors, because that’s not legal.”

Cllr Stacey added that existing suppliers with large contracts would be told “you jolly well will sign up to this charter”. He said talks were continuing with Capita-led Service Birmingham, which has contracts with the council worth £1 billion, about the speed at which the charter could be embraced.

He added: “This is about companies being partners in our communities in some of our poorest areas. We believe that companies can make a real contribution.

“The charter will put more money in the pockets of more Brummie workers, who will then spend that money at Brummie shops and businesses creating yet more jobs.”

Cabinet members will receive a lengthy report from lawyers, discussing whether the charter’s principles can be enforced – particularly a commitment to pay the living wage.

European case law gives a mixed message, but the council’s legal experts have given the go-ahead for the charter to be implemented.

Cllr Stacey said: “The jury is still out Europeanwise, but there is some very helpful advice from the EU about our ability to take into account social and economic issues when awarding contracts, even if the courts haven’t made their minds up.”

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