Social Procurement Policies in Government Construction Contracts: Law, Policy and Practice
- Publication Type:
- Thesis
- Issue Date:
- 2025
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This research addresses the persistent implementation gap between social procurement policy objectives and their practical execution in government construction contracts. Governments increasingly use procurement as a strategic tool to achieve broader societal outcomes, with many mandating that construction firms employ people from disadvantaged populations in government infrastructure projects. While significant barriers to successful implementation have been identified in both Australian and international research, this study is situated in the Australian context, focusing on improving the implementation of requirements to employ people from disadvantaged groups and create social value under social procurement policies in government construction contracts.
This study explores how policy aspirations could be better translated throughout the public procurement process. To do so, this research investigates three key stages of procurement policy implementation: policy documentation and application, the tender phase, and project implementation. Twenty-three semi-structured interviews were conducted with a diverse range of stakeholders from New South Wales and Victoria. To gain a deeper understanding of the context and nature of social procurement policies, this study also analysed policy documents and associated government material from both states, enabling a comparison of their contrasting policy approaches.
The research informs policy by identifying the institutional and procedural reforms necessary to enhance policy-led procurement. Rather than relying on vague, open-ended contractual requirements, employment and social value obligations should be clearly articulated in tender documentation, with firms competing on the basis of their implementation plans. The base weighting of social criteria in tender evaluations should be increased, and greater transparency applied to non-cost assessments. Governments should move beyond lowest-price contract awards and reject the assumption that social procurement implementation is cost-free. It is insufficient for governments to assert that these policies are important without putting proper contractual measures in place to ensure their successful implementation.
At the project level, this study distinguishes between internal and external policy intermediaries and presents a new analytical framework that establishes the foundation for developing typologies in future social procurement research. The research recommends increased government funding for external policy intermediaries.
The study makes a theoretical contribution by integrating Agency Theory and Systems Theory to examine implementation dynamics. It extends the public administration literature by identifying principal–agent problems across the three key stages of procurement. Systems Theory further highlights leverage points at each stage of implementation, identifying specific incentive structures that can drive more effective contractual and policy outcomes.
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