What is PPN 026? What the Social Value Model means for construction

Social value has always mattered in public sector procurement, and with PPN 026, it now has a more structured, consistent framework behind it. Buyers across central government are applying a refined Social Value Model that gives social value a scored, weighted place in the evaluation process, making it a genuine factor in who wins public sector work. 

For UK contractors, subcontractors, and suppliers, that shift carries real commercial weight. Buyers now assess bids against a narrower, sharper set of priorities, and vague promises no longer earn marks. What counts is specific, measurable, evidenced delivery. 

This blog explains: 

• What PPN 026 Social Value Model is in public sector procurement 
• How it differs from PPN 002 
• How PPN 026 benefits the construction industry 
• What UK contractors can do to increase their chance of winning construction bids 

 

What is PPN 026 Social Value Model? 

Procurement Policy Note PPN 026 is a UK public update on how social value should be assessed in public sector contracting.  

It gives contracting authorities a clearer framework for using social value in procurement to evaluate the wider benefits suppliers can deliver alongside the core contract, such as job creation, skills development, community impact and environmental improvement.  

PPN 026 only applies to contracts worth £1 million or more. Note that it’s not for all central government contracts. 

 

Why has PPN 026 been introduced? 

Social value has become one of the most important elements in winning public sector construction work. It is no longer a closing section of a tender that buyers skim over. It is a scored, weighted part of the decision that can decide whether you win or lose. 

When the government scores a bid, it’s not just about the price. They also give marks for other things including social value (jobs, training, community benefits). PPN 026 says social value now has to count for a set minimum share of the total marks: 

• On contracts worth £1m–£5m: social value must be worth at least 10% of the marks 
• On contracts worth £5m or more: social value must be worth at least 20% of the marks

 

What is social value in public sector procurement? 

Social value in procurement refers to the wider economic, social, and environmental benefit a supplier delivers beyond the core goods or services in a contract. In construction, that might mean creating local jobs, offering apprenticeships, upskilling workers, or supporting the communities where projects take place1. 

PPN 026 refines how buyers assess and score these benefits using the Social Value Model. It narrows the themes suppliers are measured against and tightens the expectation that social value claims are specific, measurable, and delivered, not simply promised at bid stage. 

 

Are PPN 002 and PPN 026 the same? 

No – PPN 026 replaces PPN 002 for relevant central government procurements: 

PPN 002: the broader model 

PPN 002 was introduced in February 2025 and became mandatory for central government procurements from October 2025. It assessed suppliers across five broad government missions, including economic growth, clean energy, and NHS reform. 

PPN 026: a narrower focus 

PPN 026 sharpens the approach considerably. Rather than spreading assessment across five missions, it narrows the focus to just two outcomes: Good Jobs and Skills, supported by six Model Award Criteria. 

For construction firms, this is a meaningful shift: fewer themes mean tighter, more targeted responses, with less scope to spread commitments thinly across many objectives. The two models will run side by side during the transition period. For procurements commenced before 1st January 2027, in-scope organisations may continue using PPN 002 where switching would require disproportionate resources or would invalidate prior market engagement. 

 

Who and how will PPN 026 benefit the construction industry? 

For construction firms, social value should not be treated as a vague aspiration; it is something contractors should increasing be prepared to evidence and deliver. 

As a result of the Social Value Model and the Procurement Act, SMEs will have more of an advantage to bid for more tenders. For main contractors and contracting authorities looking to win tenders, this means considering working with more SMEs2   who actively work on improving their impact on the local community. In turn, this means main contractors can create more competitive bids by showcasing which SMEs they’re working with. 

Even if you are the cheapest bidder, the contracting authority will prioritise social value marks based on PPN 026, making up between 10-20% of the final score. This links in with the Procurement Act’s intention to prioritise MAT over MEAT, the Most Advantageous Tender compared to the Most Economically Advantageous Tender, where an SME may be able to deliver more social, economic and environmental outcomes.

The ‘covered procurement’ i.e. the main contract between the contracting authority and the main contractor, falls under PPN 026 if it’s above the £1m threshold. If that main contract is then split into work packages and subcontracted, the subcontracts aren’t directly covered by PPN 026, but the main contractor may push obligations onto subcontractors via flow-down clauses in the subcontract. The changes may still affect smaller suppliers, but indirectly. 

Further government guidance will be published in Autumn 2026. 

 

Next steps  

Change is coming to the construction industry. 

Subcontractors 

For construction subcontractors, this means taking the steps towards demonstrating your impact on the community and how it’s ingrained in your business. Our compliance memberships provide an easier way for to demonstrate not only compliance, but your social value. We’ve specific PQQs tailored for Social Value! 

Learn more about our memberships. 

You can also take a look at our Procurement Act Hub to learn more about how the legislation links to PPN 026. 

Main contractors 

Looking to find subcontractors who are doing good in their local community? Working with such companies also aids your tender submissions. 

Try our Supply Chain Management solutions, so you can find suitable suppliers in one place. 

 

Key takeaways  

• PPN 026 introduces an updated Social Value Model for relevant central government procurements. 
• It replaces PPN 002 but runs alongside it during a transition period ending before 1st January 2027. 
• PPN 026 narrows the focus to two outcomes, Good Jobs and Skills, and six Model Award Criteria. 
• Social value is scored, weighted, and monitored after award, so evidence matters more than intent. 
• Firms that record, measure, and evidence social value now will hold a clear competitive edge. 

 

FAQs 

When does PPN 026 come into effect? 

PPN 026 is effective for procurements commenced on and from 1st January 2027. 

What is PPN 026? 

PPN 026 is a Procurement Policy Note that sets out an updated Social Value Model for relevant central government procurements, focusing assessment on Good Jobs and Skills³. 

Does PPN 026 replace PPN 002? 

Yes, PPN 026 replaces PPN 0024 for relevant central government procurements. However, the two run in parallel during a transition period, so you may still encounter PPN 002 on some tenders. 

When does the transition period end? 

For procurements commenced before 1st January 2027, in-scope organisations may continue using PPN 002 where switching would require disproportionate resources or invalidate prior market engagement. 

How should subcontractors prepare? 

Record your existing social value activity, set measurable commitments, build an evidence trail, and make sure your compliance and certifications are in order so main contractors can rely on you. 

Which model should I respond to in a bid? 

Always follow the tender documents in front of you. If an opportunity uses the previous Social Value Model, answer against that model rather than the one you assume applies.