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PPN 026 explained: the new Social Value Model for FM suppliers

Updated 18 October 2026. Checked against the published PPN 026 text (August 2026). Written for UK FM, cleaning, security, catering, M&E and building services suppliers.

Procurement Policy Note 026 replaces the central government Social Value Model. For labour-intensive facilities management contracts it is the biggest change to quality scoring in years: social value now focuses tightly on good jobs and skills, and the minimum weighting doubles to 20% on contracts of £5m or more.

Who PPN 026 applies to

• Buyers in scope: central government departments, their executive agencies and non-departmental public bodies. The note says other contracting authorities may wish to adopt the same approach, so expect some councils, NHS bodies and housing providers to borrow it.
• Contracts in scope: covered procurements valued at £1m or more total contract value including VAT, commenced under the Procurement Act 2023. It does not apply to private utilities contracts or contracts whose main purpose is overseas delivery.
• Frameworks: social value should be assessed at framework stage and at call-off. Detailed framework guidance was promised for autumn 2026.

When it starts

In-scope organisations should apply PPN 026 to procurements commenced on or after 1 January 2027, and a procurement commences when the tender notice is published. For Procurement Act procurements that started earlier, buyers are encouraged to move to the new model but may keep using the previous edition where switching would need disproportionate resources or would undo market engagement already done.

In practice, FM suppliers will see a mix of the old and new models through 2027. Read every tender's social value questions on their own terms.

The minimum weightings

The weighting applies where a model award criterion is relevant to the contract and proportionate. Where buyers use absolute scoring methods, such as price per quality point, the 10% or 20% applies to the non-price (quality) score instead.

The six award criteria, translated for FM

The new model has two outcomes and six model award criteria. Here is what each one is likely to mean on a facilities management contract.

Outcome 1: Good jobs

• 1a. Create and/or retain high quality jobs. Local recruitment for the contract workforce, adapting recruitment so people facing barriers can get and keep jobs, and retaining transferred staff. In FM, show how you will recruit cleaners, security officers, engineers and supervisors from the communities around the estate.
• 1b. Fair working conditions. Going beyond the statutory minimum and supporting people facing barriers to stay in work. The note gives examples such as access to trade union representation, flexible working, positive workplace culture and a healthy workforce. Shift patterns, lone working, welfare checks and guaranteed hours are all relevant in FM.
• 1c. Fair pay. Paying more than the statutory National Minimum Wage and rewarding and retaining staff through progressive pay. For cleaning, security and catering contracts this is likely to be the decisive criterion, and it has a direct price impact you must model honestly.

Outcome 2: Skills

• 2a. Training and retraining. Addressing skills shortages and supporting people from deprived areas or facing barriers to employment, co-designed with the community. Building services engineering, electrical and HVAC skills shortages are a natural fit for M&E contractors.
• 2b. In-work progression. Helping the contract workforce move into higher-paid work, and showing how that improves retention and service quality. Operative-to-supervisor pathways and engineer upskilling are strong FM examples.
• 2c. Talent pipeline. Creating a pipeline for future workforce needs through pre-work training, placements and apprenticeships. The note specifically highlights work experience as the kind of social value the government wants to see.

The note also names target cohorts that future guidance will cover, including young people not in education, employment or training, people moving from education into work, people with a long-term health condition or disability, and care leavers.

What is different from the previous model

• Narrower focus. The new model concentrates on jobs and skills. Broad community, wellbeing or environmental promises are less likely to earn social value marks on their own. Carbon is still assessed through Carbon Reduction Plans where PPN 006 applies.
• Higher stakes on big contracts. A 20% minimum on £5m-plus contracts means social value can outweigh several method statement questions.
• Community programmes. Buyers will attach relevant programmes from a published list of community programmes, and suppliers can commit to support them. Delivery is then monitored by KPI.
• Consequences. Poor performance against social value KPIs can be taken into account when considering exclusion from future tenders. Over-promising is now a risk to your pipeline, not just your margin.

What FM suppliers should do before January 2027

1. Baseline your workforce data. Pay rates by role against the National Minimum Wage, turnover, internal promotions, apprentices, training hours and local recruitment. You cannot commit to improvements without a baseline.
2. Price fair pay properly. Decide where you can pay above the statutory minimum and build the cost into your pricing model, including TUPE staff and annual uplifts.
3. Build one repeatable skills offer. A small number of apprenticeships, work placements or progression routes you can actually deliver on every contract is worth more than a long list of one-off promises.
4. Find delivery partners. Colleges, training providers, local employment services and care leaver teams near the estates you bid for.
5. Turn commitments into KPIs. For each commitment, set a measure, frequency, owner and evidence source before you submit. Buyers will monitor them, and a missed KPI can follow you.
6. Keep case studies current. Real numbers from real contracts beat any policy statement.

Sources

• Procurement Policy Note 026: The Social Value Model (August 2026)
• PPN 006: Carbon Reduction Plans
• Procurement Act 2023 short guides

This guide summarises public policy for planning purposes. It is not legal or procurement advice. The tender documents for each opportunity decide what is scored and how.