Government procurement of goods and services from the social sector is mutually beneficial. It helps the government leverage the social sector’s subject expertise and community links to deliver more efficient and cost-effective social services while also providing legitimacy and a sustainable source of income to social delivery organizations. However, the potential benefits are contingent on the ease and accessibility of government procurement and broader factors contributing to an SDO’s capacity to fulfill needs.
This policy brief provides an assessment of the policy landscape of government procurement from the social sector in Asia and highlights four key findings:
- Preferential government procurement policies in the social sector favor social enterprises over nonprofits.
- Nonprofits are contracted mostly as knowledge partners and welfare service providers, whereas social enterprises are more likely to be suppliers.
- Capacity issues are the biggest inhibitor of SDO participation in government procurement; these constraints range from production reliability to staffing to financial viability.
- Large and older SDOs with existing government relationships crowd out smaller and newer SDOs.
Based on these findings, the policy brief identifies bottlenecks that limit the potential benefits of government procurement from the social sector and introduces recommendations for governments and SDOs to address specific issues.