Social procurement is offering significant environmental, economic and social benefits for Victoria’s construction industry and is feeding down to the resource recovery sector.
Social enterprises are worth about $5.34 billion to the Victorian economy – a significant contribution to the state’s economy.
Not only do these businesses provide vulnerable groups with access to employment, but they also have the ability to help solve the world’s complex social, economic and environmental problems. Social procurement is a broad term to define organisations using their buying power to generate social value above the value of goods and services being procured.
It’s why the Victorian Government introduced Victoria’s social procurement framework in 2018, a policy that aims to build a fair and inclusive sustainable Victoria.
The Victorian Government’s social procurement objectives encompass opportunities for Indigenous Victorians, those living with disability, women’s equality and safety, disadvantaged Victorians, safe and fair workplaces and other areas.
Part of that is also environmentally sustainable outputs, practices and implementing climate change policy objectives, meaning the use of sustainable resources, recycled content in construction and lowering greenhouse gases all have a role to play in meeting these objectives.
It’s therefore of no surprise that Victoria’s pipeline of infrastructure projects is leading the charge in delivering social procurement projects. Annual infrastructure spending will be $9.6 billion from 2017-18 to 2020-21, with many contractors setting their own social procurement spending targets as part of this.
The Level Crossing Removal Project is one project providing meaningful employment, tasked with removing 75 dangerous level crossings in the state. It has set a target of three per cent of its total contract spend on social enterprises, Indigenous businesses and direct employment of disadvantaged jobseekers in the supply chain.
The Brotherhood of St Laurence is a community organisation working to prevent and alleviate poverty across Australia. With one of its sites based in Epping, Melbourne, an opportunity arose to partner with resource recovery specialists Repurpose It, located in the same suburb.
Repurpose It’s contribution to social procurement is embedded into its business model of industrial ecology, which focuses on shifting industrial processes from linear systems to a closed loop process. But the company decided to take its social procurement offering a step further by providing employment to disadvantaged communities.
Simon Gray, Employee Engagement Coordinator Brotherhood of St Laurence, says that Repurpose It’s George Hatzimanolis approached him at the beginning of 2017 as he wanted to make a difference in the local community due to high unemployment.
“George was building his business from the ground up working on major projects. There was an opportunity to create some ideal roles for our candidates, especially those working with limited English and could utilise their skills in a productive way,” Simon explains.
He says that for many candidates, this was their first job in Australia and a great opportunity to obtain meaningful and in some circumstances permanent employment in a steady workforce. In some cases, he says employees are more reliable and have a greater appreciation for their roles. Simon says many of the employees come from disadvantaged backgrounds, including refugees and asylum seekers.
“It initially starts off as a small percentage but when employers see the calibre of candidates they ask why they haven’t been doing this before,” he says.
To date, Repurpose It has employed about a dozen employees facilitated by the Brotherhood St Laurence’s Given the Chance program. The program aims to build social and business networks and lower market risk for employers and job seekers. The model is highly specialised to multicultural groups, including more than 70 per cent from refugee backgrounds, with 91 per cent of those participants completing the program.
The Level Crossing Removal Project encompasses a variety of alliances working on various projects in different regions across the state. One of these is the North-Western Program Alliance, which has successfully removed level crossings at Camp Road, Campbellfield; Skye Road, Frankston and Buckley Street, Essendon with works commencing at High Street, Reservoir.
Suzanne Hewitt, Social Procurement and Inclusion Advisor at the North-Western Program Alliance, says the alliance works with contractors to deliver social outcomes through its procurement process. Some of North-Western Program Alliance contractors already work directly with Repurpose It.
“Recruiting those who face barriers is life changing, not just for the individual but for the families and communities they live in,” Suzanne says.
“If we can break down the barriers for marginalised groups, individuals gain a sense of independence and dignity while having a direct impact on the economy through reduced welfare payments.”
Repurpose It’s George Hatzimanolis says that as a result of major infrastructure contracts issued by the state government, including the level crossing removals, Metro Tunnel and Westgate Tunnel projects, demand for social procurement is growing.
“This is filtering down to a number of industry partners, including the waste and resource recovery sector,” George says.
“For Repurpose It, we’ve seen a growing demand for social procurement outcomes for our customers.”
He says Repurpose It has received positive feedback for its social procurement efforts from all of its clients, as it fully aligns with the social purpose of the company’s purpose to convert waste into resource.
George says Repurpose It is now obtaining a certification to become a social enterprise.