4. Rapport - Progressing Public Procurement in Amsterdam (met NL Samenvatting)

Progressing Public Procurement in Amsterdam (Engelstalig met Nederlandse managementsamenvatting) June 2024

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Managementsamenvatting (Nederlands) Als onderdeel van een breder programma rond Community Wealth Building (CWB), streeft de gemeente Amsterdam ernaar de manier waarop zij inkoopt te veranderen. De gemeente wil de inkoopprocessen verschuiven van een rigide, bureaucratische en kosten gedreven aanpak, naar een model dat echte sociale en ecologische voordelen oplevert en bijdraagt aan de transformatie van de economie van Amsterdam en haar stadsdelen. Om deze verschuiving te initiëren, heeft de gemeente Amsterdam dit rapport laten opstellen om de algemene succesfactoren voor de benodigde transformatie van het inkoopinstrument te verkennen, de huidige positie van de gemeente Amsterdam ten opzichte van deze succesfactoren te beoordelen en aanbevelingen te doen voor de transformatie van inkoop in de toekomst. De belangrijkste bevindingen zijn in de onderstaande tabel weergegeven. Succes Factor

Huidige positie

Aanbeveling

1 – Begrijpen waar het geld heen gaat (Spend Analyse)

Bestaand systeem houdt alle inkooptransacties bij, inclusief geografie, MKB en bedrag/waarde.

Update/verrijk het systeem om meer inzicht te creëren in type MKB, uitgaven bij inclusieve bedrijven en overige resultaten die kunnen worden behaald via inkoop.

2 – Stel een politiek- en beleidsmatig narratief vast

Krachtige politieke en ambtelijke steun om de inkooppraktijk te veranderen, om lokale economische transformatie te realiseren en sociale en milieuvoordelen te behalen. Inkoopbeleid aanwezig, onder meer met focus op Social Return en circulair inkopen.

Deel dit inkooprapport met politieke vertegenwoordigers, wethouders, relevante afdelingen en met degenen die verantwoordelijk zijn voor het ontwerpen en inkopen van goederen, diensten en werken. Ontwikkel een Inkoopkader dat de vertaling maakt van strategisch- naar operationeel niveau en ervoor zorgt dat een breder scala aan (maatschappelijke) waarden bij elke inkoopopgave worden overwogen Betrek een breed scala aan stakeholders bij de ontwikkeling van het Inkoopkader. Het kader moet in de toekomst ook door de ankerorganisaties worden overgenomen.

3 – Ontwikkel een overkoepelend inkoopbeleid en -kader

4 – Maak het afdelings- en organisatie overstijgend

Een breed scala aan interne en externe belangstelling is aanwezig om inkoopactiviteiten te bevorderen, inclusief die van ankerorganisaties.

5 – Inbedden in de aanbestedingsfase 6 – Weging per opgave bepalen 7 – Identificeer en betrek de potentiële markt

Bestaande link tussen inkopers en degenen met specifieke beleidskennis aanwezig. Bestaand beleid voor Social Return op investeringen aanwezig, en enige betrokkenheid met bestaande leveranciers.

Pas het inkoopkader toe op alle inkoopopgaven van boven de 100.000 euro. Geef de maatschappelijke waarden bij een aanbesteding een weegfactor mee tussen de 5% en 20%. Ontwikkel een database van potentiële leveranciers in stadsdeel Nieuw-West.

8 – Stel de juiste vragen en evalueer kwantitatief én kwalitatief.

Sociale uitkomsten worden al gevraagd via het Sociale Return-beleid.

Ontwikkel een set duidelijke vragen als onderdeel van het Inkoopkader, met een bijbehorend puntensysteem voor de evaluatie.

9 – Monitor outputs, uitkomsten and impact 10 – Doorlopend evalueren

Outputgegevens (data) van het toegepaste het Sociale Return-beleid wordt verzameld.

Het Inkoopkader moet een sectie bevatten over Monitoring. De gemeente Amsterdam moet een Inkoopboard oprichten.

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Executive Summary (English) As part of a wider programme of work around Community Wealth Building (CWB), the City of Amsterdam is seeking to shift the way in which it undertakes Procurement. Primarily, the City of Amsterdam is seeking to shift Procurement away from a rigid, bureaucratic, and cost driven process to something that brings real, social and environmental benefits and contributes towards transforming the economy of Amsterdam and its districts. To commence this shift, the City of Amsterdam commissioned this report to explore the general success factors to progressing Procurement, to assess the City of Amsterdam’s current position in relation to those success factors, and to make recommendations as to how Procurement can be transformed in the future. The key findings are detailed in the table below. Success Factor 1 – Understand where spend goes.

Current Position Existing system in place that tracks all Procurement transactions including around geography, MKB, and amount.

2 – Set political and policy narrative.

Firm political and officer level backing to shift Procurement practice and deliver local economic transformation and social and environmental benefits.

3 – Develop an overarching Procurement Policy and Framework.

Existing Procurement Strategy in place, including with focus on Social Return and Circular Procurement.

4 – Make it Cross-Departmental and Cross-Organisational.

Range of existing internal and external interest in progressing Procurement activity, including from Anchor Institutions. Existing link between Procurers and those with specific policy knowledge. Existing Social Return on Investment Policy, and some engagement with existing suppliers.

5 – Build in at the Commissioning Stage 6 – set weighting on case-by-case basis, 7 – identify and engage with the potential market. 8 – Ask the right questions and evaluate quantitatively and qualitatively.

Social outcomes already asked about through Social Return Policy.

9 – Monitor outputs, outcomes and impacts 10 – continually review

Collection of output data where Social Return Policy applied.

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Recommendation Refresh system to enable understanding of breakdown of MBK, spend with inclusive business, and wider outputs delivered through Procurement, for example. Share this Procurement report across political representatives, Aldermen, Departments, and those with responsibility for designing and procuring goods, services and works. Develop Procurement Framework that operationalises the Strategy and which ensures wider outcomes are considered across all spending. Range of stakeholders to be involved in development of Procurement Framework with Framework to be adopted by Anchor Institutions in the future. Embed Procurement Framework on all purchases over 100,000 Euros. Weight these Procurement’s between 5% and 20% around wider social and environmental outcomes. Develop database of potential suppliers in NieuwWest district. Set of clear questions developed as part of Procurement Framework, with accompanying points-based system for evaluation. Procurement Framework to have a section on Monitoring. City of Amsterdam to set up Procurement Board.

1. Introduction and Context Over the course of the next 20 years, the National Program Samen Nieuw-West will seek to transform the Nieuw-West district in Amsterdam. The Program recognises that whilst Nieuw-West is a beautiful and diverse district, there is a need for significant improvement, most notably around the economy, housing, employment opportunities, safety, and for the future of children and young people. The 20 year-long Program is seeking to bring together a range of local stakeholders and including public sector institutions, businesses, NGOs, and residents to realise real transformational change in the five domains of: • • • • •

Ownership, inclusion and democracy. Safety. Work and livelihood security. Housing and living environment. Opportunities for youth.

The activities of the National Program Samen Nieuw-West are being framed by the concept of Community Wealth Building (CWB) – Originating in the United States and developed by the Democracy Collaborative, Community Wealth Building challenges the orthodox approach to Economic Development that has shaped city policymaking over the last 40 years. This orthodox approach to Economic Development has assumed that by attracting inward investment and growing the economy in Gross Domestic Product (GDP) terms that benefits would automatically ‘trickle-down’ to communities. This orthodox approach has not worked as wealth has instead been extracted from places, inequality has widened, and poverty has continued to be exacerbated - in addition, the orthodox approach has been a significant contributor to the climate crisis. Community Wealth Building seeks to realise a more people and place-based approach to Economic Development, harnessing the existing wealth and assets that exist in place and ensuring that such wealth brings local economic, social, environmental and community benefits. Community Wealth Building seeks to transfer the ownership of the economy away from wealth extraction to a more circular and localised approach.

Central to the concept of Community Wealth Building are Anchor Institutions – these are large, often public sector institutions that spend lots of money buying things (through Procurement), employ lots of people, own and manage land and assets, often have a democratic mandate, and are unlikely to re-locate elsewhere. Community Wealth Building is also framed by five pillars of activity around: spending1 (Procurement), inclusive ownership, workforce2, land and property, and finance. The Procurement pillar is an area from which many places in the United States and the United Kingdom have commenced their Community Wealth Building approach and journey. There is a recognition in particular that Anchor Institutions, including local municipalities, spend billions of Euros every year buying goods, services and works through the process of Procurement. Whilst recognising that Procurement has to be undertaken in a technical and bureaucratic way, framed by cost as a decisionmaking factor, and with complex EU and National Level Law in mind; Community Wealth Building 1

The spending pillar of Community Wealth Building includes a number of elements including development spending and spending through subsidies and grants. Throughout this report we refer predominantly to the Procurement element of spending – the process utilised by Municipalities and other Anchor Institutions to purchase goods, services and works. 2 The workforce pillar of Community Wealth Building includes a number of elements including around the recruitment of personnel, and the policies of Municipalities and Anchor Institutions around their workforces and specifically their wages, terms and conditions, and health and well-being practices.

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advocates that a more equal and just approach to Procurement can reduce wealth extraction, increase the resilience of supply chains and deliver a whole host of local economic, social and environmental benefits. The CWB Program Team at Nieuw-West recognise the importance of the spending pillar and wider Community Wealth Building to realising the aims of the Program. They also recognise that the change needed in Amsterdam is not restricted to the Nieuw-West District – instead, in order for outcomes to be realised in Nieuw-West, there needs to be shifts in the City of Amsterdam’s approach to both Economic Development and Procurement in the coming years, with this urgency also needed in other Districts such as Zuid-Oost and Noord. In order to realise cultural change around Procurement, the CWB Program Team have acquired the services of Matthew Baqueriza-Jackson, an Independent Policy Advisor who has worked with hundreds of organisations across the United Kingdom and Europe over the last 15 years to shift their culture and practice around Procurement – this has included 8 years as a Lead Expert for the EU’s URBACT Programme. Shifting Procurement processes and practice is therefore seen as central to the future local economic destiny of both Amsterdam as a whole and specifically Nieuw-West.

To enable this objective to be realised, in late November and early December 2023, Matthew Baqueriza-Jackson visited Amsterdam in order to explore the existing Procurement policies and practices of the City of Amsterdam and to identify ways in which Procurement could be adapted and progressed to realise greater local economic, social, environmental and community benefits. The visit was framed by his previous work across Municipalities and other Anchor Institutions and 10 key success factors in developing more progressive approaches to Procurement. The following sections of this report detail the key findings from the visit, with section 2 detailing each of the 10 success factors, the City of Amsterdam’s existing practice, and recommendations for the future; and with section 3 detailing the key conclusions from the visit, together with some next steps of activity. 2. Means of Progressing Public Procurement in Amsterdam The following section of the report seeks to do three things. First, and for each success factor, it provides a description of what that success factor is and how generally it progresses Procurement. Second, it details what the City of Amsterdam is already doing around that success factor – this has been derived from conversations held in Amsterdam in late November and early December 2023.

Third, it sets out a recommendation for how the City of Amsterdam can further progress policy and practice around that success factor. Where relevant, some of the success factors have been linked to other relevant ones, dependent on the stage of the Procurement Cycle. 2.1 Success Factor 1 - Understand where spend goes About the Success Factor Public Authorities will spend a significant amount of money every year through Procurement, with this amounting to over €2000 Billion across EU Member States – around 14% of Gross Domestic Product (GDP). Public Authorities should have a clear understanding of where this money goes: • • •

geographically – how much is spent in their local area or region. sectorally – how much is spent with the construction sector, for example. and in business type terms – how much is spent with cooperatives and social enterprise, for example. 5

This provides Public Authorities with a baseline position and a basis for change – they may want to spend more in the future with social enterprise, for example. What is already happening at the City of Amsterdam? The City of Amsterdam already has in place a system (currently being reviewed) which tracks every single transaction undertaken by the Municipality. This includes clear data around the name of each supplier, when the transaction was made, the broad geography of the suppliers, the supplier’s VAT code, whether the supplier is a MKB or not, and the amount paid to the supplier in that transaction. Indeed, the system has information on an annual basis from thousands of transactions. As part of the CWB Program, work has already started to be undertaken to analyse these transactions and undertake Spend Analysis of these data for 2022. Across thousands of transactions, this has enabled an understanding of how much is spent on an annual basis by the City of Amsterdam through Procurement (an annual total of 2.8 billion Euros). In particular, it has enabled an understanding of where Procurement spend goes – i.e how much is spent with suppliers based in Nieuw-West3 (just 5% of the total spend), Amsterdam, the Amsterdam Metropolitan Area, the Netherlands and elsewhere.

It has also enabled an understanding of how much is spent with MKB – this information, however, only identifies whether an organisation has less than 250 employees, rather the different nuances of MKB. The current system, however, is not straightforward to use, and is not conducive to clear, robust, and ongoing analysis around Procurement spend by sector, and by a further breakdown of the types of organisations delivering Procurement contracts, such as whether they are micro-business, cooperatives or social enterprise, women-led or global majority owned. The current system is also not directly linked to a contract management system, which details the extent to which suppliers are delivering against wider social and environmental outputs and outcomes they may have committed to during the Procurement process. Recommendation to further progress Procurement in the City of Amsterdam The City of Amsterdam is already looking to refresh its data system around Procurement spend. It is recommended that the team at the Program work directly with the Procurement team to ensure that the new system is conducive to clear and robust Spend Analysis, that can be readily updated and feed into wider policy making. In particular, the new system should enable: • • • •

• •

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transactions to be brought together for individual suppliers into an overall figure. the geographical location of suppliers (both address of registration and operation) to be analysed easily through the collection of postcodes. the overarching business type of each supplier to be detailed easily, with a more detailed breakdown by MKB, and ownership4, for example. the broad industrial sector of each supplier – this is important in identifying sectors of spend where there are particular gaps in spending in areas such as Nieuw-West and potentially where new enterprises can be developed to fill gaps. scope for contract managers to include output data about the performance of suppliers in delivery in relation to wider social and environmental commitments. Scope for information to be collected about the sub-contractors of core contractors, and particularly around their geography and workforces.

Approximately 20% of the population of Amsterdam reside in Nieuw-West. More inclusive ownership can include worker owned firms, cooperatives, and social enterprise.

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2.2 Success Factor 2 - Set a political and policy narrative About the Success Factor Public Authorities will have a range of political parties, political opinions, and political priorities that will drive strategy and policy-making. Progression around Procurement will require a cross-party political and policy narrative that is about shifting away from a process that is shaped by predominantly cost, to one which framed by a blend of cost5, quality, and realising wider local economic, social and environmental benefits. Public Authorities also will have a range of strategies such as City Strategies and Economic Development Strategies that set out the local economic, social and environmental outcomes they want to achieve and the approaches they will utilise to realise those outcomes. Procurement should be seen as fundamental to wider strategy and a key mechanism or approach which can be utilised to realise wider outcomes. Delivering local economic, social and environmental outcomes through Procurement should form a key part of the political and policy narrative of a Public Authority.

What is already happening at the City of Amsterdam? The City of Amsterdam has already started to embed the overarching concept of Community Wealth Building in political, policy and practical terms, and most evidently in its approach to Economic Development and as a core principle of the execution plan of the National Program Samen NieuwWest. As part of the National Program, it has been recognised that policy and practice around Community Wealth Building needs to expand beyond a district Program to something that is mainstreamed across the Municipality and wider Anchor Institutions. This expansion is commencing with the pillar of Procurement and has firm political and officer level backing. The activities described throughout this report are framed by existing programmes around Procurement such as Social Return and the Procurement Strategy (Inkopen met Invloed) – described in more detail in Success Factor 3. Indeed, utilising Procurement to realise Community Wealth Building and wider social and environmental outcomes formed the basis of a ‘Technical Session’, hosted by a City Councillor in October 2023, and which included participation across political parties and the Procurement Team at the City of Amsterdam.

In addition, the deputy mayor Hester van Buren and the Director of Procurement attended a workshop involving Procurement Officers and economic, social and environmental Policy Specialists in November 2023 which looked to further progress how Procurement is undertaken in the City of Amsterdam. The above suggests that there is an emerging political and policy narrative in the City of Amsterdam around both Community Wealth Building and progressing Procurement – however this is in its early stages. Through the CWB Team, work is also underway to engage with Anchor Institutions based in the Nieuw-West district. This engagement is both general in seeking to formulate an Anchor Network that seeks to move Community Wealth Building forward in Nieuw-West; and specific to the Procurement processes and practices of the Institutions engaged. Into the future, the Network will seek to support a shift in the behaviours of the Anchor Institutions around the process of Procurement and so that greater emphasis in particular is placed upon engaging inclusive businesses and other organisations based in Nieuw-West in Procurement opportunities.

Recommendation to further progress Procurement in the City of Amsterdam This Report presents a key opportunity for the political and officer leadership of the City of Amsterdam to promote the importance of Community Wealth Building and progressing Procurement to a wide 5

Cost is not just about the price of a product; it can also be seen as a longer term investment. Consideration of cost should go beyond narrow consideration of GDP growth and financial profit

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audience. The report should be shared across political representatives, Aldermen, Departments, and those with responsibility for designing (commissioners)6 and procuring goods, services and works. This report should be a mechanism for sharing the political and policy narrative around Procurement, both internally at the City of Amsterdam and to Anchor Institutions in Nieuw-West. It should also inform wider reports around Community Wealth Building. 2.3 Success Factor 3 - Develop an overarching Procurement Policy and Framework About the Success Factor Public Authorities should develop an overarching Procurement Policy or Strategy that outlines their approach to buying goods, services, and works. As well as outlining their approach to legal frameworks, risk, and thresholds of spend, it should outline the types of wider local economic, social and environmental outcomes that the Public Authority is looking to achieve through Procurement. This in turn should be utilised to develop a Framework outlining the types of outcomes that are looking to be achieved, the questions that can be asked during a Procurement in relation to them, how responses can be evaluated, and how those outcomes can be monitored during delivery.

What is already happening at the City of Amsterdam? The City of Amsterdam already has in place a Procurement Strategy (Inkoopstrategie) that outlines the technical aspects for the purchase of goods, services and works. The Strategy is shaped by consideration of what is needed (the good, service or work), analysis of the potential market, and the type of procedure to be utilised. The Strategy specifically sets out: • •

• •

•

The legislative and policy framework to undertaking Procurement in the Netherlands, including the EU Procurement Directives and National Level Law. The financial thresholds at which certain procedures need to be implemented, such as the need to advertise opportunities above the Official Journal of the European Union (OJEU) thresholds EUwide. The City of Amsterdam’s approach to risk associated with Procurement. The City of Amsterdam’s policies around the inclusion of social and environmental clauses in Procurement (Social Return), around Circular Procurement, and for Reserved Contracts for social enterprise. The City of Amsterdam’s approaches to different types of procedure such as Competitive Dialogue (concurrentie gerichte dialog), Pre-Commercial Procurement (pre-commerciële incoop), and Innovation Partnerships (innovatiepartnerschap).

Recommendation to further progress Procurement in the City of Amsterdam Whilst the City of Amsterdam already has a clear strategy of how it should undertake Procurement from a technical perspective, and has included the consideration of local economic, social, environmental and community outcomes as part of the process, the effectiveness of the inclusion of such outcomes has not always been as effective as it could have been. The consideration of such wider outcomes should be undertaken at different stages of the Procurement journey, with those designing goods, services and works opportunities (Commissioners) key to embedding such outcomes. To assist with this, the City of Amsterdam should develop a Procurement Framework, which operationalises the Procurement Policy and outlines clearly the following:

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Commissioners are specialists with responsibility for designing goods, services and works. Procurers are the specialists responsible for issuing and evaluating tender documents. Both Commissioners and Procurers have a key role in embedding local economic, social and environmental considerations in procurement.

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• • • • • •

The wider outcomes that are being sought to be realised through Procurement and that are detailed in City Strategy. The types of activities which potential suppliers can undertake to realise those outcomes. The areas of Municipality Procurement for which the outcome is relevant. The types of questions that can be asked of potential suppliers during the Procurement about the outcomes. How responses to questions can be evaluated as part of the decision-making process for the successful supplier. A way in which the outcome can be monitored during the delivery of the contract.

The Procurement Framework should be straightforward to use and be clear for commissioners working across a range of services areas, as to the types of wider outcomes that are appropriate for the types of goods, services and works that they purchase. 2.4 Success Factor 4 - Make it Cross-Departmental and Cross-Organisational About the Success Factor The process of Procurement is often seen as the domain of a centralised Procurement Team within a Public Authority or that of specialist Buyers of particular products and services. However, there are many stakeholders that should be involved in Procurement, whether it be those designing the services (Commissioners), Economic Development Teams that have knowledge of the potential market, Policy Teams that have knowledge of specific outcomes that can be achieved, or Contract Managers who have responsibility for ensuring effective delivery of the contract. Procurement should be CrossDepartmental and indeed Cross-Organisational, with many Anchor Institutions also able to contribute to the realisation of local economic, social and environmental outcomes through their own Procurement processes. What is already happening at the City of Amsterdam? It was clear from the workshop held in November 2023 that a wider range of stakeholders at the City of Amsterdam have an interest in Procurement and using it to deliver wider outcomes.

Indeed, the workshop was attended by those with responsibility for designing goods, services and works, Procurement technicians, those with knowledge around social issues such as unemployment and climate change, and representatives of business and social economy representative organisations. In addition, in the week prior to the workshop, a group of stakeholders, including civil servants within the City administration, had visited the United Kingdom to explore Community Wealth Building, and the spending pillar in Preston, England and Scotland. This suggests there is a commitment in place to undertaking cross-departmental working around Procurement and also across public, commercial and social economy organisations. This has been further enhanced by a member of the Procurement Team being seconded to work directly with the CWB Team. There is also an emerging group of Anchor Institutions that are based in the Nieuw-West District that are interested in Community Wealth Building, developing an Anchor Network, and working specifically to shift the way in which they undertake Procurement and so that it delivers greater benefits for local businesses and social economy organisations, and enables wider social, environmental and community outcomes. The organisations showing interest include: De Alliantie, Ymere, OLVG, HvA, STWT, and Pantar.

Recommendation to further progress Procurement in the City of Amsterdam The Procurement Framework described in Success Factor 3 should be developed and co-produced by a range of stakeholders from within the City of Amsterdam, and including those with knowledge of 9

specific local economic, social and environmental challenges and outcomes; those with knowledge of specific types of goods, service and works which the Municipality is seeking to procure; those with knowledge of Procurement procedures and evaluation techniques; and those with experience of monitoring impact. This would enable the Procurement Framework to be truly co-designed and owned across Departments. It would also need senior Procurement and Legal Officer involvement to ensure the Framework fitted within the existing technical aspects of the Procurement Strategy and additionally political representation to ensure alignment to wider City Strategy. The emerging Anchor Network should continue to engage together and discuss specifically practice around Procurement and changes that could happen within the process to realise greater local economic, social, environmental and community benefit through their spend. In the longer-term, the City of Amsterdam Procurement Framework described above could be expanded to policies and practices of the Anchor Institutions.

2.5 Success Factor 5 - Build in at the Commissioning stage, Success Factor 6 - Set weighting on a caseby-case basis and Success Factor 7 - Identify and engage with the potential market About the Success Factors (5) It should not be the direct role of centralised Procurement Teams or Buyers to decide which local economic, social or environmental outcomes are relevant for a particular purchase of goods, services or works. Instead, Procurement Teams should work with Commissioners – those with responsibility for designing goods and services and who can provide input on the relevance or otherwise of outcomes, and based upon a solid understanding of CWB, way before reaching the Procurement stage and tendering for the activities with the market. Public Authorities should think strategically very early in the process of Procurement, as if it is not done in Commissioning, it will be too late when it reaches procurement. (6) Public Authorities will buy a wide range of goods such as stationery and furniture, services such as catering and building maintenance, and works such as construction projects, with the relevance of the inclusion of social and environmental considerations dependent upon the nature of what is being bought. They should set the percentage against which they will weight social and environmental considerations on a case-by-case basis.

(7) Public Authorities have often claimed that the biggest barrier that they face in progressing Procurement is an inability to engage with the local market due to EU Procurement Law. This is not the case – Public Authorities should be and are across Europe engaging with the market prior to a procurement exercise commencing to share what they are looking to buy, and to detail the types of wider local economic, social and environmental outcomes they are seeking to realise. This could be undertaken further through dedicated ‘Meet the Buyer Events’. What is already happening at the City of Amsterdam? From the workshop in November 2023, it was evident that there are already relationships between those with responsibility for purchasing goods, services, and works and those with specific policy knowledge around social enterprise and addressing climate change, for example. This relationship is not, however as evident with those that are responsible for designing goods, services, and works and where initial conversations need to be undertaken as to the types of wider outcomes that are relevant to what they are seeking to purchase. There are some examples of this beginning to happen, particularly around the purchase of catering contracts, and specifically the need to engage with local growers and producers to reduces the distance that goods travel.

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The City of Amsterdam also has an established Social Return Policy, which where appropriate is used to seek to realise social outcomes around employment, in particular. The Social Return Policy is used specifically, but not limited to, construction projects where there is scope to support individuals that have been long-term unemployed into the workplace and also for services where there is scope for sheltered workspaces for disabled people to deliver elements of the contract. In terms of engagement with the market, the City of Amsterdam hosts an annual meet the market day (marktdag), whereby all suppliers are invited to come and discuss procurement approaches and other topics including around sustainability. This is complemented by a category management system, where the relevant category managers hold regular conversations with suppliers about the progress of the delivery of their good, service or work. Recommendation to further progress Public Procurement in the City of Amsterdam In terms of building in at the commissioning stage, the City of Amsterdam should embed the Procurement Framework (as discussed in Success Factor 3) into the design of all goods, services and works above a threshold of 100,000 Euros.

Here, Commissioners will explore what they are looking to buy and identify which of the outcomes detailed in the Procurement Framework are relevant – it may be that this identification is undertaken with the support of specific policy specialists and the legal team to ensure it is completely relevant to the good, service or work being purchased. In terms of setting decision-making weightings around the wider outcomes detailed in the Procurement Framework, the City of Amsterdam should set this weighting on a case-by-case basis during the commissioning stage, and be considerate of the type of good, service or work being procured, and the extent to which wider outcomes can be potentially achieved. Alongside considerations of costs and quality of bidder’s responses, the City of Amsterdam should consider weighting on contribution towards achieving wider outcomes, with this forming, based on experience from elsewhere between 5% and 20% of the evaluation and decision. This should move beyond the remit of the existing Social Return Policy and may be seen as labour intensive – however, it will ensure that wider outcomes are considered across the variety of things that the City of Amsterdam buys through Procurement.

In terms of engagement with the market, the CWB Program Team should continue to develop a database of businesses and other types of organisations that are based in the District, and that are potentially interested in bidding for and delivering Procurement contracts. The database should be informed by the Spend Analysis undertaken as part of Success Factor 1, and particularly focus upon areas of Procurement spend where there is significant extraction out of the Amsterdam and the Netherlands economy to large Multinationals, and for opportunities below 100,000 Euros. The basis of this database should be the Koop Lokaal Platform, with this also applicable to other Anchor Institutions as well as the Municipality of Amsterdam. The City of Amsterdam should look to share the Procurement Framework and its wider outcomes with all potential suppliers to ensure awareness of the wider outcomes they are looking to realise through Procurement – however, specific emphasis should be placed on Pre-Procurement engagement in some of the more deprived districts. 2.6 Success Factor 8 - Ask the right questions and evaluate quantitatively and qualitatively About the Success Factor Public Authorities should use the Procurement Policy and Framework produced in Success Factor 3 as the basis for the questions they ask during Procurement around wider local economic, social and environmental outcomes.

These questions should not be generic, but specific to the outcome they are 11

seeking to realise. Public Authorities should subsequently use a points-based system as a way of evaluating the tender responses of bidding organisations to the specific questions about wider outcomes. This points-based system should enable evaluation to be undertaken in both a quantitative and qualitative way. What is already happening at the City of Amsterdam? The City of Amsterdam does already require potential suppliers to detail how they will contribute to social outcomes on relevant Procurement opportunities through the Social Return Policy, with this applicable on all Procurement’s above 200,000 Euros. They also have a ‘CO2 Performance Ladder’, and which is focused upon ensuring that suppliers are committed to reducing their carbon footprint. This ask of suppliers however does not expand to wider local economic and CWB outcomes. Recommendation to further progress Public Procurement in the City of Amsterdam As part of the development of the Procurement Framework as detailed in Success Factor 1, the City of Amsterdam should develop a set of clear questions, framed by wider Community Wealth Building considerations and Procurement Strategy that could be asked during Procurement procedures in relation to each of the wider outcomes.

Once Commissioners have decided upon the wider outcomes that are relevant for the good, service, or work that they are looking to purchase, those working in Procurement should identify the relevant questions for including in the Procurement documentation and alongside wider technical, cost, and quality requirements. In addition, and also as part of the development of the Procurement Framework detailed in Success Factor 1, the City of Amsterdam should develop a points-based system that enables both quantitative and qualitative responses to questions around wider outcomes to be evaluated. This should enable those responsible for evaluating responses to objectively evaluate and score the wider outcome commitments of potential suppliers. 2.7 Success Factor 9 - Monitor outputs, outcomes and impacts and Success Factor 10 - Continually Review About the Success Factor (9) Undertaking the previous 8 Success Factors will take energy, capacity and time – Public Authorities should therefore ensure that the process of Procurement does not conclude with the decision upon a successful supplier. Instead, the local economic, social and environmental considerations that the successful supplier committed to should become a condition of contract and be monitored against throughout delivery.

Public Authorities should collect output data from suppliers, identify the outcomes it has realised for individuals that have benefited, and explore the impact it has had upon realising wider local economic, social and environmental outcomes. This should however recognise the capacity of small suppliers in particular, with capacity building support provided to support the process. (10) The process of Public Procurement should not be static – instead, Public Authorities should be continually evaluating, reviewing and adapting their processes to ensure maximum local economic, social and environmental benefits. What is already happening at the City of Amsterdam? For contracts for which there are Social Return commitments, the City of Amsterdam actively engages with successful suppliers to collect data and other information about progress. This is undertaken by a specialist Social Return Team, who assist suppliers in meeting their obligations and monitor their progress.

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Recommendation to further progress Public Procurement in the City of Amsterdam The Procurement Framework that the City of Amsterdam as detailed in Success Factor 3, should also have a section on monitoring. The City of Amsterdam should outline a means through which successful suppliers can submit quantitative output data around the realisation of local economic, social and environmental outcomes that they committed to, and which can be added to the refreshed transaction system. The City of Amsterdam should also create a mechanism through which Contract Managers can engage with successful suppliers to identify more qualitative outcomes and impacts they are realising through the delivery of the contract – this could be through quarterly reports for high value contracts or the development of a Supplier Network. This monitoring activity should complement wider level monitoring through Brede Welvaart that is already happening as part of the National Program and CWB. The City of Amsterdam should also set up a ‘Procurement Board’ that consists of Policy specialists, Commissioners, Procurers, Contract Managers, Politicians, and Strategy makers to review and evaluate the impact of the Procurement Policy and specifically the Procurement Framework as described in Success Factor 3.

This would serve the purpose of identifying where the adapted approach to Procurement is working and where there is scope for further amends. 3

Conclusion and Next Steps

The workshop and other meetings held in Amsterdam with the City of Amsterdam and other Anchor Institutions in late November and early December 2023 provided an insight into the City of Amsterdam’s approach to Procurement. The content detailed in section 2 has reflected back the thoughts and information provided during those sessions and has enabled a set of recommendations to be developed. It is clear that there is already lots of work underway in political, policy and practice terms to progress the way in which Procurement is undertaken in the City of Amsterdam and that those activities are a really good starting point. In addition, there are some real assets in the team at the CWB Program, politically, and in Procurement and wider teams at the City of Amsterdam that have a real desire for change in Procurement so that it reaps real local economic, social and environmental benefits. Throughout Section 2, we have detailed a series of recommendations for the City of Amsterdam, the CWB Program Team and other Anchor Institutions to further progress Procurement. In the final part of this report, we look to put those recommendations into a chronological order: • • • • • • •

End of February 2024 – Matthew to be in Amsterdam again and to share finding of this draft report. By end of March 2024 – Report to be finalised and designed ready for communication. April and May 2024 – Report to be disseminated across a range of audiences and including Politicians, Policy Teams, Commissioners, Procurers, Contract Managers and Anchor Institutions. April 2024 onwards – refresh of Procurement transaction system and including elements required for Spend Analysis (Success Factor 1) and Monitoring (Success Factor 9). April 2024 to September 2024 – development of draft Procurement Framework. September 2024 to March 2025 – testing of draft Procurement Framework on live Procurement exercises. April 2025 onwards – implementation of Procurement Framework.

This work around progressing Procurement in Amsterdam should not be viewed in isolation – it is part of a much wider approach to changing the economic system and narrative through Community Wealth Building. It clear needs to be driven forward by the City of Amsterdam and Anchor Institutions, but

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equally requires the engagement of business, social economy organisations and communities to be successful.

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