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The Global Procurement Network Social Procurement and Economic Development in Greater Western Sydney The Business Case Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au www.arcblue.com.au 0412 318 384

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The Global Procurement Network ArcBlue Government Procurement Development Activity across Australia/NZ VIC State Government CIPSA Certification VIC Local Government Procurement Roadmap Development Contract Management Guidelines and Training Procurement Leaders Conference NSW State Government Accreditation Program preparation and assessment Category Management Programs NSW Local Government Roadmap Program with LGP Procurement Leadership Program Social Procurement Guidelines Regional Procurement and Shared services Programs State Government Local Government SA Local Government Roadmap Program Regional Development Programs Procurement Capability Assessment / Development Federal Government Contract Management Development Regional Social Procurement Development Federal Government QLD Local Government Gold Coast Capability Development and Contract Management Program LG Social Procurement Forum WA Local Government Procurement Training Program NZ Local Government Procurement reviews NZ Government Departmental reviews

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The Global Procurement Network NSW Social Procurement Action Group (SPAG) 17 cross-sector organisations working support the growth of social procurement 2012 Launch of Social Procurement in NSW: A Guide to Achieving Social Value through Public Sector Procurement Social Procurement Australasia (SPA) A non-profit Association supporting the growing demand for guidance, networking, and development in the social procurement field Established to increase the social impact of procurement in Australia and New Zealand Founding Members include: Social Traders, ArcBlue, Eco-Buy, Councils, NSW SPAG, Peak Bodies including the MAV (Vic) and Local Government Procurement (NSW) Activities: Forums/ events; Website portal Case studies, research, clauses, guidance; Newsletters; Advocacy, policy development; Training and support

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The Global Procurement Network Greater Western Sydney A Picture Region20122036Increase Greater Western Sydney2,033,1612,922,854889,693 Sydney Metropolitan Area4,343,0925,601,6231,258,531 Population Growth 47% of the population of metropolitan Sydney live in GWS By 2036, this will be over 50%. An increase of 890,000 people in GWS by 2036, compared to only an additional 370,000 for the rest of Sydney.

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The Global Procurement Network Greater Western Sydney a Picture Gross Regional Product: Greater Western Sydney in 2011-12 was $97,150 billion from a total Sydney GRP of $306,172 billion Employment: 706,359 people employed in Greater Western Sydney in 2011 from a total of 1,961,823 for the whole of Sydney Youth Unemployment 11.2% Sydney - 19% Central-west, 13.2% South-west, 13.5% North-west 47% of the population of Sydney 32% of the Gross Regional Product 36% of the Employment 75% of the unemployment (97,000 as at Jan 14)

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The Global Procurement Network Greater Western Sydney A Picture Source: AECGroup 2013 Employment Containment: According to the 2011 Census, there were over 724,000 workers residing in Greater Western Sydney Of these, 516,000 worked in GWS

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The Global Procurement Network Greater Western Sydney A Picture Employment: The unemployment rate for GWS at February 2014 was 6.8% while for the rest of Sydney the rate was just 5.0%. Participation rate for GWS was 63.6% compared to 68.3% for the rest of Sydney. The Industry Employment Mix is changing Industry No. employed in GWS 2011 Increase since 2006 % increase Manufacturing 104,315-4,226-4% Health care & social assistance 81,55513,38520% Retail trade 80,5011,3512% Construction 61,3044,7818% Education & training 58,1006,13512% Public admin & safety 45,7295,66014%

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The Global Procurement Network Greater Western Sydney A Picture Education Levels Proportion of people with post-school qualifications: Overall in metropolitan Sydney 55%, while in GWS 46.8% GWS has a lower proportion of people with degree qualifications and a higher number of people with certificate qualifications.

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The Global Procurement Network GWS - Critical Challenges and Opportunities Job Creation Creating jobs for GWS residents, particularly local and regional jobs Business Development Developing opportunities for and the capacity of local and regional businesses and attracting businesses to operate and employ in GWS Economic Participation Creating and sustaining opportunities for economic participation for those excluded or disadvantaged Specific groups e.g: Place-based disadvantage (social housing, specific areas) Aboriginal community Disabled physical/ intellectual Long-term unemployed CALD communities/ refugees Young people

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The Global Procurement Network New Approaches to Achieving QBL Objectives All levels of Government & (Private Sector) have social, economic, environmental and Leadership/ Governance objectives (QBL) Traditional silo approach to achieving objectives Innovation Complex issues require new models New ways to address complex, multi-causal and long-standing community, economic and environmental issues Integrating QBLS objectives into procurement, service design and employment For Government these may include: Breaking cycles of long-term disadvantage Providing genuine pathways to training and sustainable employment Achieving Zero Waste and carbon footprint reduction targets Driving local and regional economic development outcomes

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The Global Procurement Network Strategic Procurement Procurement is how we spend most of our money NSW State Govt $25bn and Local Govt $9bn each year Service delivery, community and civil infrastructure GWS Local Government expenditure estimate of $1.5bn/ year Private development housing and infrastructure Major Projects Procurement is moving from an administrative activity to a strategic one NSW Government Accreditation Program underway across State Departments NSW Local Government Roadmap Program 60 Councils will have participated by June 2014 Regional Programs underway in Southern Sydney, Central and Southern NSW WSROC Program begins on the 7 th of May Procurement represents significant market power to: Deliver high quality, value for money goods, services and works; Drive sustainable cost savings; Influence, enable and stimulate the private and social enterprise markets to deliver social, economic and sustainability outcomes;

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The Global Procurement Network Professional procurement Influencing the business Transactional Order placement Level 1 Emergent Level 2 Basic Level 3 Developing Centre of Excellence across all expenditure Procurement foundations in place with improved controls Some functional and category strategies in place Focus on meeting legislative requirements Largely unco-ordinated procurement with gaps in compliance Level 4 Advanced Levels of procurement maturity

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The Global Procurement Network Procurement Maturity Model

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The Global Procurement Network Functional Silos Strategic Social Procurement Strategic Procurement Social Objectives Organisation Social procurement - a strategic approach to meeting social and economic objectives through procurement

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The Global Procurement Network Social and Sustainable Procurement - Features An efficient way to deliver social impact Does not require new money making the most of the money we are already investing NSW $34bn/ year State Govt $25bn/ Local Govt $9bn Service delivery, community and civil infrastructure GWS Local Government expenditure estimate of $1.5bn/ year Private development housing and infrastructure Major Projects Procurement is moving from an administrative activity to a strategic one Significant market power to: Deliver high quality, value for money goods, services and works; Drive sustainable cost savings; Influence, enable and stimulate the private and social enterprise markets to deliver social, economic and sustainability outcomes;

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The Global Procurement Network Social Procurement and Economic Development in GWS Expanding range of case studies and activity already underway International, National, Local Challenges Inconsistent practice ad hoc rather then mainstream Need for sustained collaborative GWS solutions Priorities How to we ensure social and economic objectives are built into project design and procurement practice creating demand? Ensuring that the way Major Projects are planned and delivered leaves lasting legacies for GWS How do we ensure supply capacity to respond to those social and economic objectives: Strengthening opportunities and the capacity of local and regional small to medium businesses and social enterprises to participate in the supply chain Strengthening pathways to employment for disadvantaged residents

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The Global Procurement Network The Day Ahead