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How do you measure social value?

Date: 20.07.21

Prior to and since “Social Value” was boosted into common currency in the UK by the Public Services (Social Value) Act 2012, there has been a plethora of initiatives seeking to give “Social Value” definition and tangibility, many with a starting assumption that “measurability” is the critical subject.

However, especially in public services, the starting point should be the recognition that Social Value stands for the great value in the provision of a service that is not necessarily reducible to formal or precise measurement. But the real value can still be understood. Mariana Mazzucato Professor in the Economics of Innovation and Public Value at UCL, uses the illuminating example of universal state education. The cost can be measured, but the socio-economic value is exponential.

The same is true, for example, of genuinely preventative public service social interventions, where multiple future costs of future public service interactions are saved, the lives of individuals are enhanced into greater personal well-being and community socialisation and society benefits from greater economic productiveness.

Such matters can be made subject to “Social Return on Investment calculations” and to proxy-financial credit methodologies, such as the Social Value Portal’s “Themes, Outcomes and Measures”. But the key is a commissioning strategy that treats Social Value/Public Value as the essential purpose and a professional application to the complexity of endeavouring to realise the specific target benefits, outcomes and impacts.

Measurement methodologies need to be serious and credible, but they do not need to replicate price-based methodology, which itself only approximates to true socio-economic value.