Nice People; Terrible System

Contents

Introduction

Method

Acknowledgements

Organisation type and turnover

Involvement in strategic commissioning

Involvement in procurement

Specific provider experiences

Collaboration but no follow through

‘Box ticking’ consultation leads to poor outcomes

The process and requirements were disproportionate

Unsustainable hourly rates and lack of future-proofing

Quality: price ratio means price is the only determinant

Proportionate retender to amend contractual terms

Excessively complex contracts and lack of risk sharing

Unclear responses to questions during the tendering process

TUPE and tight timescales cause problems

A block contract and clear specification encouraged creativity

Retendering reduces the local provider market

Collaboration needs specific skills and dedicated resources

Discussion themes

The relationship between commissioning and procurement

Market inequity

Fear

Leadership and behaviours

Provider behaviour

Current contracting practice

Current coproduction practice

Current processes

Monitoring and evaluation

What is the remedy? Suggestions for improving practice

Incremental

Breakthrough

Disruptive and game changing

ANNEX A - survey

1

1

1

2

3

4

6

7

7

7

8

8

8

8

9

9

9

9

10

10

10

11

12

13

14

14

15

15

16

16

17

19

21

22

1

IntroductionIn 2017 CCPS surveyed providers to understand their experience of commissioning and procurement over the preceding year. Sixty- eight providers of varying turnover, size and geographical reach gave their experience with twenty- five providers sharing a specific example of a recent procurement process and its’ effects.

MethodThis was a small- scale exploration of provider experiences only. The work comprised a short survey (n=68) a collection of case studies (n=25) and a small focus group (n=4) to test out emerging themes. Given the number of participants, this report should be treated as indicative, not representative.

AcknowledgementsWe would like to note our thanks to all the providers who responded to the survey, the organisations that publicised the survey and those who gave their time to participate in our focus group.

We would also like to note our thanks to the Scottish Government who provides part funding for CCPS’ Commissioning and Procurement Programme.

Design by Michael Coyle michaelcoyle.co

2

Organisation type and turnoverThe survey asked organisations to tell us the main group(s) they serve and their turnover. The majority of respondent organisations are comparatively large with a turnover of over £30,000,000 with a significant proportion of small to medium respondents.

Analysing responses by turnover did not yield significant differences in commissioning and procurement experience.

The majority of respondents provided support to adults across a range of areas of work including learning disabilities, physical disabilities, sensory and communication needs, criminal justice, homelessness/housing and mental health. Providers working across both adults and children’s services; and dedicated services for children were also represented.

3

Involvement in strategic commissioning

“Everything spoke towards change. But the incumbent system could not change. People make decisions and so ultimately people decided not to change.”

Providers described having opportunities to contribute to commissioning processes but described this mainly as being consulted on plans that were already underway. Strategic commissioning plans were seen as disconnected from the reality of commissioning and procurement on the ground.

4

Very few respondents had no commissioning involvement but correspondingly few (5) described their involvement as ‘coproduction’. A minority of respondents (under 10) had contributed data to strategic planning processes reflecting the ongoing challenge of provider data being used in commissioning analysis, rather than simply in contract monitoring.1

The majority of respondents (83%) described their overall involvement with commissioning as ‘consultation’ with very few (17%) describing something close to involvement and none approaching co-production.

Involvement in procurement

“[a framework is like] a zero hours contract for an organisation”

Over three quarters of respondents received some, or all of their income from competitive tendering. These included single and two stage competitive tendering- most commonly on to a framework.

Framework agreements require suppliers to compete on to a contract (by demonstrating they meet certain standards) without a guarantee of business. Some framework agreements require further competition (known as ‘mini- competitions)

—

1 ‘We need to learn where third sector evidence fits’ http://evaluationsupportscotland.org.uk/media/uploads/resources/final_web_ess_ttn._-_need_to_understand.pdf

5

for business. Procured frameworks are becoming more common as commissioning authorities look to individualise budgets under Self-directed Support.

The next most common source of income was competitive grant processes followed by a small number of providers who had participated in more collaborative approaches such as Public Social Partnerships (PSPs)(11) innovation partnership procedures (7) and alliance contracting (3.) Respondents observed in the comments that the predominant approach is still tendering even though there are some pockets of innovation.

92% of respondents had tendered for a contract in the last 12 months. 44% had withdrawn from a tendering process and 18% had handed back a contract in this period.

Withdrawal from tendering was due to low hourly rates, TUPE issues and (particularly for small to medium organisations) the complexity and time required to tender. Of the 18% who had handed back a contract this was because the contract had become financially non-viable. Particular pressures identified included the requirement to pay the living wage within existing hourly rates and cost pressures related to sleepovers.2

—

2 See http://www.ccpscotland.org/hot-topics/hourly-rates-wages for further discussion on cost pressures.

6

Respondents were asked to rate their involvement in procurement on a scale that ran from consultation (low involvement) to coproduction (high involvement.)

The majority of respondents 57% described their involvement in procurement as ‘consultation’ with 34% describing something close to coproduction 9% describing the process as fully coproduced. The spread of involvement here is better than that seen in the commissioning question; this is most likely due to respondent participation in partnerships, alliancing and PSPs which all have a collaborative phase.

Specific provider experiences

“[Competitive] tendering destroys the very relationships that are crucial to success.”

Twenty- two respondents shared a procurement experience from the last 12 months. Respondents were asked to describe their role in the process; any barriers/problems; any positives/facilitators and the outcome of the process. Case studies are presented below against these main themes:

7

Collaboration but no follow throughOrganisation T was involved in a coproduction process to re-configure existing services to meet budget cuts. The process was described as ‘coproduction’ but the organisation did not think this was an accurate description. Despite arguing for an alternative to competitive tendering the contracting authority insisted this was required. Organisation T saw a significant disconnect between the co-production work and the ultimate decision makers and noted that ‘tendering destroys the very relationships that are crucial to success’.

Organisation J was approached to co-produce a new model of support for an existing service. Significant time and resources were put in to co-produce this with statutory sector colleagues. Local authority decisionmakers did not agree to the proposal as they thought it was too ambitious. Organisation J observed that although the words were there (‘more of the same won’t do’) the reality of delivering the change was seen as too much, despite general agreement that the process was the right way to approach service redesign.

Organisation J noted that the ultimate impact, as in every procurement process, is on the supported person making the need for change all the more urgent.

Organisation A submitted a bid to a competitive tendering process designed to identify a single supplier. The organisation won the bid and encountered no significant problems. However, the organisation could not identify any positives and noted that there appeared to be no scope for alternatives in the process.

‘Box ticking’ consultation leads to poor outcomes Organisation K was involved in a consultation process for a tender. They described their role in this as ‘passive’ and the consultation as a box ticking exercise for a pre- set agenda.

The process and requirements were disproportionateOrganisation D bid for contracts to secure new work and retain existing work. On balance, they won more tenders than they lost. The main problems they encountered were to do with timescales and resources. Timelines were very tight and huge resources required to respond to the tendering process. The organisation felt the amount of evidence and information required was grossly disproportionate to the value of the contract.

Organisation L tendered for a small contract and were awarded it. Their main problem with this was the massively over-bureaucratic process for a small value contract. They described tendering as ‘nice people; terrible system.’

8

Unsustainable hourly rates and lack of future-proofing Organisation C bid on to a competitive framework and were successful. However, the framework was fixed price over a number of years meaning it was impossible to predict future costs (as the living wage is set on an annual basis.) Other than this the organisation found it a relatively straightforward process.

Organisation B bid on to a competitive framework to retain their existing contracts. They lost out in one area because their rate was ‘too high’. Organisation B could not identify any positives to the process and observed that contracting authorities are persisting in setting unsustainably low hourly rates and complex and unwieldy contract terms.

Quality: price ratio means price is the only determinant Organisation H was involved in initial consultation to design a contract specification. This consultation gave the organisation a clear idea of the priorities of the commissioning authority. Less positively the price: quality rating within the tender meant that price was, in effect, the determining factor. (Where more than one organisation scores the maximum/near maximum for quality then price becomes the determinant.)

Proportionate retender to amend contractual termsOrganisation I was an existing contract holder with a contracting authority and took part in a retender to allow update/amendment to their contract terms. They were successful and found no problems within the process. They positively described the process as relevant and proportionate and carried out within the stated timelines. This positive experience was not reflected in Organisation I’s work in other areas and it is interesting to note that the contracting authority chose a retender where a contractual update would have been possible.

Excessively complex contracts and lack of risk sharing Organisation B bid on to a competitive framework to retain their existing contracts. They lost out in one area because their rate was ‘too high’. Organisation B could not identify any positives to the process and observed that contracting authorities are persisting in setting unsustainably low hourly rates and complex, unweildy contract terms.

Organisation N submitted a bid to join a multiple lot, one stage, framework contract. The contracting authority ran ‘engagement’ events with providers but these simply set out the decisions that had already been taken and did not invite consultation, involvement or coproduction. The tender included different rates for different complexities of need – ostensibly to allow support to be tailored effectively to the person. In reality, the criteria meant that people could not be moved to a higher rate without risking the triggering of a retender on the ground that the provider was no longer able to manage this degree of complexity.

9

Unclear responses to questions during the tendering processOrganisation N experienced significant process issues such as the contracting authority not providing feedback; fixed rates over a number of years (meaning it is difficult to pay the living wage) and unclear responses to questions posed during the tender process.

TUPE and tight timescales cause problemsOrganisation E was one of a number of providers bidding for new business through a competitive tender for a single provider. The organisation was successful in winning the tender which required TUPE of staff over from the incumbent provider. The main problems they encountered related to timescales (delays in the tender evaluation) and difficulties getting complete TUPE information from the outgoing provider. Organisation E noted that the responses to provider questions were often unclear making the process complicated and creating unnecessary risk for providers.

Organisation O was involved in the retendering of an existing service and were awarded the contract again. The main problems they encountered were the very tight timescales between award and service commencement and challenges with TUPE.

Organisation S took part in a competitive tender to secure a new contract for an existing service. Their main problems were to do with the process- the timescales for bid completion were short and there was a lack of clear detail on the TUPE implications from the outgoing provider. TUPE also posed an affordability problem in that it made the cost of the service almost unviable. Organisation S found the Q&A function in the procurement process helpful.

A block contract and clear specification encouraged creativity Organisation F participated in a relatively straightforward bid (competitive tender) and were awarded the contract. This was a block contract for a new service and commissioners gave a clear steer on what they didn’t want alongside space for the bidders to innovate and propose new approaches. Having an awareness of the strategic plan in the area and the need for the new service also supported the process.

Retendering reduces the local provider market Organisation Q was involved in a retender designed to implement a capped rate and set further rates for 5-7 years. The retender involved a desktop analysis by the contracting authority following which the contract was awarded. This reduced the number of providers in the area and damaged the local provider market.

10

Collaboration needs specific skills and dedicated resourcesOrganisation R worked within a coproduction process to design a new support service. The positives of this experience were getting involvement in the process and the chance to meet with and work with other providers. Less positively there was a lack of clarity on what was being purchased; future budgets and contract values. There was a lack of skilled, dedicated resource from the contracting authority to help make coproduction happen effectively.

Organisation P was involved in a process to redesign an existing service which resulted in a reduced number of providers delivering the contract. The process was very problematic and took 18 months to complete leaving staff and service users uncertain and unsettled. Although Organisation P has increased their business in the area and have a better contract they don’t see the process as having any positives as it simply led to loss of other providers in the area. Organisation P identifies that formal/legalistic interpretations of procurement work against coproduction and innovation- despite that being the very thing we need to do.

“Christie said ‘more of the same won’t do’ however more of the same is what procurement does. Can we get back to commissioning proper – with a focus on coproduction and innovation?”

Discussion themes

The relationship between commissioning and procurement

“It was all going well through the commissioning, but the procurement was an unmitigated disaster.”

It is very difficult to think about social care as a whole system as it can feel overwhelming. However, when social care is divided into professional and functional silos fragmentation and disconnection result. Respondents repeatedly identified a fundamental disconnection between commissioning and procurement and a sense that procurement in particular lacked insight into the impact of their decisions on other parts of the system. Examples included:

• Cutting the hourly rate has a cross- system impact on recruitment, retention, non- salary items (E.g. training and supervision) and ultimately organisational sustainability and market diversity.

• Asking the market to ‘be more innovative’ is not possible where procurement procedures are so tight they do not allow for innovations.

Respondents were clear that effective commissioning should set the direction and priorities for a procurement strategy. However a more common experience was one of procurement driving commissioning; or acting contrary to the stated commissioning

11

priorities of the area. Other respondents identified different departments driving decision making (particularly finance and legal) and identified a need to challenge the assumption that finance duties supersede those of social work and social care.

Market inequity

“I wish they were ever asked to justify the same things.”

A significant amount of discussion focussed on market inequity between the third and private sector providers and the in- house services delivered by the contracting authority.

In a ‘free’ market there are many purchasers and many providers; with the advent of marketisation in social care in Scotland there is a quasi -market known as a monopsony (one purchaser, many providers.) On the face of it this looks like a positive option for the contracting authority- they have full control of price and specification. However, this form of market is dysfunctional in two ways. Firstly, and most importantly, monopsonies limit service user choice (contrary to the values and principles of Self- directed Support). Secondly monopsonies, particularly those which focus heavily on price tend to reduce market diversity and encourage reversion to a monopoly (single provider) at which point the contracting authority has considerably less leverage and this can lead to market collapse.3

In addition to the structural inequity inherent in a monopsony there are specific inequities that underline the power imbalance between contracting authority and external provider.

• Price inequity Respondents gave examples of where in-house service prices were higher than those in the external market and that when cuts were made in-house services were protected.

• Standard and quality inequity They gave specific examples of in-house services not being held to the same performance standards (complaints, resolution, reach, effectiveness etc.)

• Provider- commissioner inequity Some respondents identified a lack of role clarity where a local authority is both a provider and a contracting authority. They argued that this colours procurement processes and investment decision making in an unhelpful way and prevents the authority from seeing and facilitating the total market.

—

3 Evans, K (2016) Public markets aren’t working for the public good, or as markets’ in Pell, Mason and Lowe (eds) “Kittens are Evil: Little Heresies in Public Policy” Triarchy Press;

12

Fear

“What drives behaviour? I was going to say the same, well I was going to say, fear is a big thing”

Austerity is driving risk adverse behaviour across all parts of the commissioning and procurement system. Respondents described adversarial dynamics within pre- procurement and contract discussions. An example was given of a contract variation meeting attended by 5-6 council officials and one provider that was characterised by an unwillingness to negotiate/compromise.

Some respondents saw an increase in procurement activity (particularly detailed contract management) as related to procurement officials feeling the need to add value through visible ‘provider management’. This could be related to the targets that they work towards (which are largely related to process compliance4) or the general sense of unease across the third and public-sector workforces as work intensifies and job stability decreases.

There was a sense from some that the professional authority of commissioners had been eroded by increased power in other departments (primarily finance and legal) and that professionals on all sides are explaining their risk adverse behaviours in terms of external forces or regulatory constraints.

Fear driven behaviours were not confined to the public sector. Respondents identified a reluctance in the third sector to raise issues or criticise as it might put contracts, and therefore people’s support, in jeopardy.

Looking more generally to risk in procurement in social care one respondent observed that analysis of risk is very partial, and this is constraining exploration of new options. They observed that there is a tendency to over analyse the risk of new proposals without proper consideration of the risk of the status quo.

Fear can drive over-compensation and overinterpretation. Respondents shared a wide range of risk adverse practice that they attributed to procurement officials’ concerns about breaking the law or running counter to local authority standing orders. These included:

• Failing an organisation at PQQ stage because they had less than 3 months reserves. The prior year having 3 months of reserves would have been seen as a negative and triggered clawback from the contracting authority.

• Refusing to engage in pre-market discussion/engagement with providers as it was feared this would give these providers a competitive advantage.

—

4 The Procurement Capability Assessment (PCA) is a continuous improvement tool designed to improve capability in procurement to “increase savings through collaboration, better use of technology, and adoption of standard procurement practices across organisations, while balancing issues of economic, social and environmental sustainability.” http://www.gov.scot/Topics/Government/Procurement/Procurement-News/NewsVault2014/changestoPCA

13

• Triggering full retendering in order to apply a cut to an existing service without looking first to a contract variation as a solution. The local authority did not want to change provider in this case.

• Micro-management of provider budgets which was seen as being used as a diversionary discussion from more significant issues related to hourly rates.

Leadership and behaviours

“A lot of local authorities have trouble letting go, don’t they?”

If fear is driving negative behaviours in the supplier- purchaser relationship how do those behaviours manifest? Respondents painted a picture of procurement over-reach, budgetary and monitoring micro- management and systemic lack of trust on all sides. A key negative behaviour (also identified by respondents as characteristic of suppliers!) was that of ‘othering’ – looking to everyone else in a system and telling them to change rather than approaching issues as shared and multi-factorial.

Turning to more positive experiences a number of respondents spoke highly of well conducted pre- market engagement. In one example the providers did not go for the contract in the end but felt the honest pre- market discussions helped them to make the right decision and that the contracting authority was responsive to the wider provider market when challenged on hourly rates and costs.

The second behavioural factor identified was contracting authority culture and how this was shaped by the ‘big machine’ of the council. Participants noted that the contracting authority culture is hierarchical and encourages and rewards command and control leadership and follower behaviours. Participants noted how difficult it is for individual commissioners to influence their own organisations citing the experience of Self-directed Support implementation as an area where ‘good people had to ‘fight internally’ to make change happen.5

Organisational size and complexity can also mean that procurement officials are unfamiliar with cost components (overheads etc.) as these are centralised and not often counted in the cost of in- house services.

—

5 This was also reflected by participants in the ‘Doing Things Differently’ commissioner/provider action learning set. http://www.ccpscotland.org/pp/topics/things-differently/

6 http://www.ccpscotland.org/hseu/wp-content/uploads/sites/2/2017/12/Business-Resilience-Survey-2017.pdf

14

Provider behaviour

“We’re all nice people! and the system relies on us not challenging poor decisions.”

Provider respondents identified their own behaviours within the system as being characterised by a reluctance to challenge poor decisions. Several noted the fear of not getting more work while others countered saying they are now more frequently withdrawing from contracts/declining to tender as the rates are insufficient. This reflects the findings from the CCPS business resilience survey which showed 33% of providers having withdrawn from a contract and 65% having declined to tender on grounds of cost.6

Organisations that keep taking on cuts and resource reductions were seen as compromising their own sustainability. While the group was sympathetic to the reasons for this (continuity of support for people) they saw this approach as fundamentally unhelpful. They expressed concerns that this led to unsustainable business models and ultimately market failure. Respondents spoke of the risk to quality as training, supervision and other ‘soft’ budget lines bear the brunt of reductions when cuts are made.

Participants identified a positive approach taken by one local authority. In this area they take a fully outcomes-based approach and base support on a real discussion with the person and the provider. They give flexibility in spending so when budgets reduce it’s possible to, with discussion, tweak a person’s support to make the savings. Budgets tend to be low, and this can mask some problems but overall this was a positive approach.

Current contracting practice Overall it was felt that contracting practice has improved with bidders understanding earlier in the process what the parameters were and being able to make informed decisions about whether to tender. Contracting language and the intent behind the processes were seen to be positive with the main barrier being, as ever, implementation.

Issues related to current practice were wide- ranging and have been summarised and grouped as followed.

• Being asked to deliver services, within contract, that a provider was not contracted for (E.g. support for a young person when they ran an adult service).

• Unrealistic timescales- e.g. expecting a non- emergency service to start within 7 days of referral.

• Unsustainable contract clause terms- e.g. a 5-7-day notice period to end a service. This is particularly difficult where personalised teams are recruited to an individual and workers cannot be readily redeployed to another service.

15

• Contracting should be a foundation for a conversation not an opportunity to be adversarial. Where it works well it gives time to match a person to a support team and build a good quality service around them.

• Local authorities are struggling with the practicalities of outcomes-based contracting. Despite the challenges in implementing outcomes approaches this was generally felt to be the best way forward, particularly for making sure support was personalised.

Current coproduction practice Coproduction has many definitions and interpretations and provider experience of coproduction within procurement reflected this. Variable processes ranged from good quality pre-market engagement to inappropriate use of ‘Public Social Partnership’ style methods that gave a veneer of co-production but in reality, all decisions had already been taken by the contracting authority.

Participants spoke at length about their experience of PSPs noting that these could be very positive but only where they were truly coproduced, and attention was given to the intellectual property and time investment given by providers. A number of respondents spoke of their frustration at committing to 2-3 years of coproduction work including testing and piloting and then the contract going to an out-of-area provider who had not been part of the work.

Current processes

“An over ask, an over response… a castle made of sand…”

It was important to all respondents that local authorities followed their own procurement processes. In this discussion the group noted a ‘copy and paste’ approach to procurement alongside a lack of understanding of costing and finance for providers.

In terms of finance there was a lack of understanding of the relationships between hourly rates and staff pay. An example was given of a local authority who was surprised that an external provider would not be able to TUPE over its’ staff on the grounds that they couldn’t honour the local authority salary and benefits due to an insufficient hourly rate. Other finance issues included lack of understanding of the degree of subsidy provided within services (some respondents highlighted this as poor practice on the part of providers and contributing to market instability.) One provider gave an example of positive practice. The contracting authority arranged an open session with finance staff where providers were able to share and discuss their component costs. The provider felt this helped both the authority and the providers reach a shared understanding of a viable hourly rate.

16

—

7 Kabach (2012) clarifying innovation https://experiencinginformation.com/2012/06/03/clarifying-innovation-four-zones-of-innovation

Evaluation criteria also came in for criticism with respondents citing the use of non- scoring evaluation criteria; meaningless scoring (e.g. scoring price in a single price point tender) as common and problematic. Other process issues included disproportionate tendering processes; duplication within processes; changes to expectations post award (i.e. the addition/continuation of services outwith the tender) and changes to the financial package.

Respondents noted that there were good procurement and commissioning officers, but they were often working around their own processes. These processes need to change to make room for good people to do the work.

Monitoring and evaluation The theme of mismatched expectations carried through to the discussion on monitoring and evaluation. Respondents saw some monitoring practice as ‘tick box’ focussing only on numbers and not taking into account their data on effectiveness and impact. Respondents noted it could be difficult to get a reliable way of measuring outcomes across multiple providers (and in-house services) to allow commissioners to understand service use, effectiveness and quality across a whole system.

Respondents noted that some service commissioners are not working from a balanced evidence base which comes through as a preference for certain service approaches. This worked against taking an outcomes focus to support where the approach is agreed between the provider and the supported person.

Generally, the use of evidence is better in smaller authorities where people tend to have direct relationships across the contracting authority. Coproduction and involvement tended to be better in these areas too.

What is the remedy? Suggestions for improving practiceWhile diagnostics are useful in understanding – it’s not enough to restate a problem and expect change to follow. Those responding to the survey and focus groups identified many possible actions to improve commissioning and procurement.

Based on Kalbach (2012)7 these were split into the following categories. The first two sections include are changes that are comparatively easy to make. These look to improve our current practices (incremental) and use what we are learning to change what we do (breakthrough.) The second two categories are more difficult to make a reality. Actions within these categories would require significant energy to overcome resistance. These include fundamental changes to our values, perspective and cultures in commissioning and procurement.

17

• Incremental: small improvements and enhancements that ‘keep things going’

• Breakthrough: more radical, larger change that changes services significantly- often the result of research and development.

• Disruptive: radical change that may lead to short term discomfort, disruption and unexpected outcomes. Disruptive change resets the values and perspectives of a system.

• Game-changing: transformational change that impacts on how people act, think and feel. As a result completely new approaches and offers are created.

IncrementalCommissioning

• Commissioning and procurement should work more closely together with commissioning setting the priorities and procurement advising on the means to encourage development of services to respond to these priorities.

• Commissioning and procurement should take a market facilitation, not a provider management, approach.

18

• Contracting authorities should model the effect of a change before implementing it This can be done formally through the use of modelling software or through convening cross- sectoral and cross- authority groups to discuss and model the effects of a decision.

• Procurement should take an outcomes-based approach to maximise budget flexibility while refraining from financially punitive models such as payment by results.

Before a procurement exercise

• Collaborate more before the competitive phase of procurement. Make better use of ‘market engagement’ to really understand what is needed.

• Link the procurement process directly ‘up’ to the overall commissioning strategy.

• Think about the impact specific processes will have on outcomes for people and outcomes for provider organisations. For example if you’re looking to innovate don’t write a long, detailed specification that prevents innovation!

• Think about the impact specific processes have on cost. For example where you’re using spot purchase for a small number of people this is likely to be more expensive. Where you’re using a framework with no guarantee of business for the provider there may be a time lag before they can recruit.

When setting an hourly rate

• Understand the cost of providing social care and what hourly rates are composed of. The component rate template from CCPS and this guidance from CIPFA (UK) can help with this.8

• Taking an outcomes-based approach to maximise budget flexibility while refraining from financially punitive models such as payment by results.

When deciding on timescales

• Consider a longer lead- in from contract award to contract start.

• Consider the implications of timings for ending and starting contracts. Where start periods are very short personalised teams can’t be built. Where notice periods are very short providers will incur considerable costs re- deploying or making staff redundant.

—

8 http://www.ccpscotland.org/hot-topics/hourly-rates-wages/tools-and-resources/

19

When writing a specification

• Be less generic and more tailored- leave room for the work to be personalised to the supported person.

• Don’t specify so much that there is no room to meet outcomes or be innovative.

• Make sure the specification is outcomes focussed, not, time, task or model focussed. You are purchasing the expertise of the provider- use the specification to invite them to tell you how they will meet outcomes.

• Use evidence, information and data when writing your specification.

• Link your evaluation criteria to the specification. Don’t ask questions that you’ll not be evaluating (e.g. where the price is fixed you don’t have to ask about it.) This saves time for both the contracting authority and the bidders.

When deciding on your contract duration

• Longer term contracts with clauses to allow continuity of support where the person is satisfied with it and break where they are not. This means that people’s continuity of care and relationships with providers are not broken by unnecessary retendering. This is low risk for local authorities as they can still break the contract if the person says or indicates they are no longer content with the support or for other breaches of the agreement.

Breakthrough Processes and consistency

• Consider a consistent approach to coproduction across local authorities.

• Make more use of collaborative, flexible processes in pre- procurement, procurement and contracting.

• Put a focus on quality, not price. This is intrinsic to developing trust between providers and commissioners, trusting providers to use funding in an outcomes focussed way to support people well.

• Encourage procurement staff to visit services to understand the nature of what they’re purchasing and how their decisions impact on people.

• Agree a standard set of information from providers (e.g. on policies, finances, care inspectorate grades etc.) across Scotland.

• Use the same monitoring and evaluation processes with in- house and external providers to make performance expectations equal between the two sectors.

20

Behaviour and values

• Develop more openness and trust between providers, commissioners and supported people.

• Embrace Self-directed Support in spirit as the key to really changing social care for the better.

Commissioning and procurement practice

• Recognise the value of intervening at the right time and the cost of not intervening. This means that some services will require initial or front-loaded investment to allow them to intervene early and prevent crisis.

• Treat in- house and external services equally. Use the same performance requirements and same outcomes evaluation to give an accurate picture across the whole system.

• Invest in the right part of the process. Frontload procurement efforts to pre-procurement activities and specification development.

• Carefully consider the need for formal (procured) frameworks and the impact these have on restricting choice and increasing organisational instability.

Training and skills

• Encourage discussions and workshops with legal staff, commissioners, and providers to help dispel myths about existing limits on collaborative procurement practice.

• Maximise opportunities to put the sectors together –e.g. CCPS commissioning and procurement programme.

• Provide training for councillors sitting on decision making Committees in the effects of procurement.

Third sector relationships

• Do more work on collaborating within the voluntary sector. This could take the form of formal collaborations/consortia or larger organisations buddying Small and Medium sized Enterprises (SMEs) to support them with tender writing.

21

—

9 https://www.legislation.gov.uk/asp/2014/12/contents

Disruptive and game changing These changes will be more difficult to implement as they require major systemic change or a change in culture across the sectors. Though difficult to implement, these changes are worth investing in given they would change the foundations of the way we work.

• More than one organisation suggested dropping competitive tendering (or procurement processes altogether) in social care. Competitive tendering was seen as ‘useful if you’re buying widgets’ but as fundamentally the wrong process for social care. Competitive (re)tendering tends to focus the procurement system on the wrong purpose (price) and disrupt service continuity; contribute to organisational instability and create an adversarial operating environment between contracting authorities and providers.

• As an alternative, respondents looked to reframing ‘commissioning and procurement’ as a form of ‘joint problem solving’ between partners. Respondents looked to emerging approaches (alliancing, place-based commissioning etc.) for clues as to what this might look like.

• Several respondents talked about creating a high trust environment although there was less clarity on how this could be achieved. This included a cultural reset for contracting towards viewing providers as partners (not suppliers ‘to be managed’) alongside a cultural reset for the third sector from supplier/applicant to partner and contributor. Here respondents looked to emerging learning about systemic and collaborative leadership for clues as to how this might look. The creation of a high trust environment would then lead to a more experimental and less risk adverse approach to what is purchased in social care. Several respondents called for taking more risks in the development of services- calling for better assessment of the ‘risks of doing the same thing’ when considering newer approaches.

• The more game changing proposals included a complete exemption of social care from procurement (possibly through an extension of s.129 of the Procurement Reform (Scotland), Act, 2014.) This proposal is currently constrained for contracts about the EU threshold but could be revised as part of the major legislation change required by Brexit.

• Respondents suggested a critical review of the service models that are commissioned. Focus group respondents identified several longstanding interventions that have been shown to be ineffective but are still being commissioned. Some respondents argued that truly radical commissioning would simply present the issue and that model based commissioning would be retired.

22

ANNEX A - survey

1. My organisation works with (please tick all that apply)

ɥ adults

ɥ children and families

ɥ people with learning disabilities

ɥ people with physical disabilities

ɥ people with sensory loss/communications difficulties

ɥ older people

ɥ people affected by the criminal justice system

ɥ homelessness

ɥ housing support

ɥ Other (please specify)

2. My organisation’s turnover is:

ɥ Under £500,000

ɥ Between £500,000 - £999,999

ɥ Between £1,000,000 - £1,999,999

ɥ Between £2,000,000 - £4,999,999

ɥ Between £5,000,000 - £9,999,999

ɥ Between £10,000,000 - £19,999,999

ɥ Between £20,000,000 - £29,999,999

ɥ Greater than £30,000,000

3. In the last 12 months my organisation has:

ɥ tendered for contract(s)

ɥ withdrawn from tendering process(es)

ɥ withdrawn from/handed back a contract

ɥ What was your reason for withdrawal?

23

4. In the last 12 months we have participated in the following procurement processes:

Process Some of our income

All of our income

None of our income

I don’t know what this is

Two stage competitive tendering (pqq/itt)

Single stage competitive tendering

Competitive tendering on to a framework (call- off)

Direct award of contract

Grant funding (competitive)

Innovation partnership procedure

Alliance contract

Strategic partnership

Public social partnership

5. How would you rate your overall involvement in procurement processes? (slider scale from 0-100)

Consultation Involvement Coproduction

6. In the last 12 months my organisation has:

ɥ been consulted on a strategic commissioning plan

ɥ contributed data to a strategic commissioning plan

ɥ coproduced a strategic commissioning plan

ɥ Other (please specify)

7. How would you rate your overall involvement in local commissioning processes? slider scale from 0-100)

Consultation Involvement Coproduction

24

8. Thinking of a specific experience of commissioning/procurement over the last 12 months

ɥ What was your role in the process?

ɥ What was the purpose of the process?

ɥ What happened?

ɥ What were the main problems you encountered?

ɥ What were the positives/facilitators you encountered?

ɥ Anything else you would like to tell us?

9. What one thing would improve your organisation’s experience of commissioning and procurement?

10. Who is this action for? (e.g. CCPS, Scottish Government, Integrated Joint Boards)

11. We will be running a number of focus groups to understand people’s experience in more detail. If you would like to be part of this please enter your name and contact details below.

About CCPSCCPS is the Coalition of Care and Support Providers in Scotland. It exists to identify, represent, promote and safeguard the interests of third sector and not-for-profit social care and support providers in Scotland, so that they can maximise the impact they have on meeting social need.

CCPSNorton Park57 Albion RoadEdinburgh EH7 5QY

0131 475 2676ccpscotland.org

CCPS is a company limited by guarantee registered in Scotland No. 279913 registered with the Office of the Scottish Charity Regulator as Charity No. SC029199.

June 2018 - This work is licensed under the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International Licence. To view a copy of this licence, visit https://creativecommons.org/licenses/by-nc-sa/4.0/

The Coalition of Care and Support Providers in Scotland (CCPS)

Company NumberSC279913

Scottish Charity NumberSC029199

Registered officeNorton Park, 57 Albion RoadEdinburgh EH7 5QY