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Policy and Strategy Committee

6 November 2007

1. Purpose of report
   1. To summarise the main finding of the contracts review of social care and support services and identify key areas for improvement.
   2. To seek agreement to ongoing implementation of the main findings of the review.
2. Main report
   1. In December 2005 the Council agreed the report “Funds to Third Parties – Current Status and Future Management Arrangements” and committed to a corporate review of contractual arrangements which would run concurrently with the development of “Moving Forward: Together” the City Funding Strategy.  The review has been led jointly by the Children and Families and the Health and Social Care Departments.  A Reference Group was established with representation from the stakeholders from the third and private sector, to facilitate discussion about the Councils contracting arrangements.  Appendix 1 identifies the membership of the group.
   2. In 2006/07 the Council spent £114m on the purchase of social care and housing support services from external organisations.  Three Departments, Children & Families, Health & Social Care and Services for Communities are responsible for this purchasing and buy services from approximately 650 voluntary and private sector providers.

3. Several external factors have shaped the review, namely:-

• the Public Contract (Scotland) Regulations 2006 which stresses the need for openness and transparency in the award of contracts, along with the subsequent guidance in July 2006 on advertising of public sector contracts.
• Changing Lives – Report of the 21st Century Social Work Review 2006 with its emphasis on purchasing “personalised services “.
• Supporting People – Procurement Information Sheet 2007, which sought to clarify the position regarding tendering and renewal of supporting people contracts, recommending that a procurement risk assessment is undertaken when a contract is coming to an end and that amongst other factors service users need for continuity of service provision can be considered.  The Council’s solicitors are revising the procurement framework for social care services, to take account of this guidance and apply the principles to all social care contracting.
• introduction of a National Contract for Care Homes for older people in April 2007.
• signing of the Memorandum of Understanding between the Council and the Scottish Commission for the Regulation of Care in early 2007.  This aims to improve communication between the organisations and to avoid duplication of work for the agencies and providers.
• Scottish Executive Guidance on Self Directed Support 2007, which recommends that Councils actively manage budgets to increase direct payments and/or develop individual budgets.

4. There has been significant interest in the review by existing providers and other interest groups.  Edinburgh Voluntary Organisations Council (EVOC) has co-ordinated communication with a wide range of voluntary providers via the Compact arrangements (web-site) and several consultation meetings. The review has identified areas where the Council contracting activity could be rationalised, moving to more consistent and streamlined tendering and contractual arrangements.

The way forward

5. A diagram of the contracting cycle (Appendix 2) has been developed to help explain the procurement process in this area.
6. Appendix 3 identifies the main areas that have been raised for improvement and a range of proposed action.
7. Findings suggest that the following contractual documentation should be produced for use by the three service Departments, using common standard clauses where possible:-
   

• updated model block contract;
• model framework agreement;
• Procurement Risk and Quality Assessment (Appendix 4);
• Procurement Framework for social care and support services to be amended in line with the Supporting People Procurement guidance (see item 2.3);
• CEC (legal) definition of a grant and contract;
• clarification of the legal implication of duty to care and duty of care;
• development of a four year plan for advertising social care and housing support contracts. This will be informed by department’s strategic priorities  and associated service specifications.

8. The issue of renewal of existing contracts dominated the review.   In response to provider’s concerns regarding contract renewal (and following the Scottish Executive’s Procurement Guidance) the Council is developing a Procurement Risk and Quality Assessment. It is proposed that this tool be used in the last year of the contract to inform a judgement about whether a contract should be renewed or re-tendered. The assessment will look at issues such as strategic fit, value for money, vulnerability of services users and likelihood of a procurement challenge.  The guidance helpfully suggests how Councils should procure supporting people services, and the Council has suggested that these principles can equally apply to other social care services.
9. It is recommended that a corporate approach to monitoring occurs which focuses upon both quality and service user outcomes be implemented.  The tools used will be developed locally, to assist in monitoring both individual services and contribute to monitoring overall progress within a strategic programme of investment. The current use of the Edinburgh Common Client Outcome (ECCO) arrangement should be considered in such developments.
10. It is proposed that a short life group is established under the auspices of the City Funding Strategy for the Council and partners to continue work on a project basis, in progressing the recommendations contained in this report.  There would be representation on the group from the Council, social care providers (voluntary and private) and service user groups.   Service user interests were not represented on the Reference Group, it is recommended that they are included in the future.   Communication would be enhanced through the use of the Compact website for the dissemination of contractual information and a forum for dialogue.
    
11. Guidance on the purchasing of social care and support increasingly emphasises the need to focus on the customer – the service user.  The impact of the Scottish Government’s recent guidance (concerning self-directed support) on the Council is under consideration and will be reported on separately.  Significantly, a move to more self-directed care and an increase in direct payments could alter contractual arrangements between the Council and providers. In these circumstances the relationship would be directly between the service user and the service provider.
    

3. Financial Implications

1. There are no financial implications at this stage.  However there are likely to be costs introduced with achieving the developments proposed in this report notably development of a common reporting mechanism, monitoring and reviewing services.  A separate report will be submitted once these costs have been identified.

4. Recommendations

1. It is recommended that Committee agree the:-

i. annual reporting of contract spend for the previous financial year occurs in September;

ii. Council’s normal practice is to issue three year block contracts, with the option of a three year renewal, unless there are exceptional circumstances;

iii. development of a corporate approach to monitoring social care and housing support services which focuses on quality and service user outcomes building on existing good practice such as the ECCO system;

iv. developing a consistent approach to payment of inflation which is open and transparent;

v. payment arrangements being harmonised and a gradual move to payment four weekly in arrears on submission of invoice as services are tendered;

vi. a single Council Officer having lead responsibility for liaison between the Council and provider (even if several Departments have an interest);

vii. use of the proposed Procurement Risk and Quality Assessment in the final year of a social care or housing support contract, and;

viii. creation of a short life reference group with representation from providers and service user representatives whilst the Council implements the recommendations in this report.