- Membership model accessible to all local authorities in the UK
- Collective approach aims to reduce duplication and inefficiency in care placement procurement process
- Alliance tackles issues around sufficiency and cost in national care provider market
ACTION
The Commissioning Alliance offers its local authority members an innovative approach to commissioning residential and foster care placements.
The consortium, which grew out of the long-standing West London Alliance, has a membership made up of 14 London councils and Buckinghamshire County Council.
One of its aims is to help local authorities to keep a handle on the issues of placement cost, sufficiency and quality in the children’s social care market.
According to recent research on behalf of the Local Government Association, nearly three in four children’s home and almost a third of fostering places are provided by private organisations.
As such, the alliance recognises the difficulties faced by local authorities in using a complex national market of care providers and offers membership as a way to help them navigate the process more effectively.
Laura Harris, who heads the alliance, says its model has been specifically developed so that any local authority can join.
From its early days sharing information about placements and providers, the alliance has since developed this practice into e-brokerage and e-contracting tools that it uses to engage with different care markets, she says.
“We realised we needed to become more innovative and try to fix some of the fundamental flaws in these markets so we could better start to meet the needs of young people,” says Harris.
A children’s commissioning procurement service set up by the existing West London Alliance laid the groundwork for the development of new frameworks.
These involved a set of dynamic purchasing vehicles (DPVs) covering fostering, residential care and special educational needs (SEN), explains Harris.
DPVs are a completely electronic system used by an authority to purchase services, which suppliers can apply to join at any time.
“We were able to use our CarePlace tool for e-brokerage, but also all the data that was collected on the back of that helped us to better understand the market and create real information to make us more intelligent customers,” she says.
The DPVs then formed the basis of good practice by the alliance across areas such as pricing strategies, terms and conditions, and approaches to create a level of competition in the market, she adds.
“It was done to enable us to change and manage that market and transform it in a way that helps us get best value, but also builds up sufficiency in areas we don’t have,” says Harris.
Local authorities that join the alliance benefit from economies of scale of being part of a network, says James Weaver, the alliance’s head of operations and business support.
Many spend huge amounts of time, effort and legal resource creating their own frameworks which then in turn increases complexity and cost in the market, he explains.
“The amount of procurement that’s going out on behalf of local authorities to individual providers in a national market just generates that inefficiency,” he says. “That is effectively cost put back on the local authority.
“By setting something up that’s national that a local authority can join gets rid of duplication and inefficiency,” he says.
The alliance says it does not replace “placement making” for its members for their residential and foster care needs.
The exception lies however with SEN for which it offers a brokerage service for local authorities to put through referrals that the alliance then handles on their behalf.
Harris says for residential and fostering placements, the alliance’s e-tools support local authorities to make placements and it carries out the contract management for providers.
“Local authorities have their own ways in which they want to access the market, so the tools are configurable to their requirements, while maintaining best practice and consistency,” she explains.
Simon Riggs, the alliance’s business change manager, says it has significantly increased the number of care providers that its members can use through DPVs.
With 70 independent foster care agencies and 378 children’s residential homes, the numbers represent a huge increase compared to other care services contracts available for local authorities, he says.
Widening the scope of providers is critical in a sector where children’s needs are increasingly complex, says Harris.
“Often we find we don’t have the capacity or the risk appetite in the market to support those children with high needs.”
She says data shows a 22.5 per cent increase in residential children’s home costs since 2015.
“Local authorities have no choice but to place children and there is no internal equivalent provision to act as an alternative solution, of which the private sector is fully aware,” she says.
However, she says the alliance achieves on average just over five per cent better rates in fostering and around 4.5 per cent for residential homes compared to other local authorities both in and outside London.
IMPACT
Harris says Redbridge Council, the first non-West London authority to join the alliance in April 2018, saved 16 per cent on its fostering spend in the first year of membership.
The deciding factors that led to Redbridge joining the alliance were driven by cost and capacity issues, explains Anthony Pardoe-Matthews, the council’s head of contracts and procurement for both children and adult social care.
He says the authority had lost up to 70 per cent of its capacity to support commissioning in children’s social care over a period of six months. “I didn’t have the capacity to launch large scale procurement across a market as diverse as children’s social care and then maintain it,” he says.
Choosing to join the alliance was done mainly for “practical reasons” but also because Pardoe-Matthews supports the principle of collaboration between authorities to manage the market.
“Single authorities just do not have that power or sway with the [children’s social care] market, it’s too diverse and too big,” he adds.
Pardoe-Matthews says Redbridge is relatively stable in its number of looked-after children, which averages 220 to an upper limit of 235 children.
He says the “real value” from alliance membership comes from independent foster agencies where it has proved successful.
Placements brokered with the alliance have been maintained at around £800 a week, including some complex cases.
However, placements made for children placed outside of the alliance can cost up to £975 a week, with complex cases being as much as £2,000 a week.
Pardoe-Matthews believes the advantages for Redbridge’s membership are “multi-faceted” including increased purchasing power, reduced time spent on market management, and the use of an effective digital platform with which to engage the market.
“The alliance gives a transparent focus on cost, as well as showing where people are driving down cost more than others.
“This gives multiple learning opportunities which is really important when it comes to issues such as brokerage,” he adds.
UNREGULATED CARE ACCREDITATION
A three-stage process forms the basis of the Commissioning Alliance’s accreditation scheme for unregulated accommodation and support.
Launched in August 2019, it aims to address “latent risks” posed to local authorities placing young people in unregulated accommodation.
The first stage assesses that settings are fit for purpose by carrying out checks on landlords and firms and past financial history.
Those providers that pass the initial stage are visited by the alliance’s team who request data from files such as a random sample of staff references.
A third and final stage involves a property inspection where it is rated according to a checklist of standards.
The alliance wants to raise the standard of accreditation gradually for settings over a sustainable timeframe “because if we have a standard that’s too high, you’ll wipe out the entire market from day one and then you’d be forced to place [young people] anyway”, explains Jonny Woodthorpe, alliance senior commissioning manager.
“We set a standard that’s higher than they currently provide but not unachievable,” he adds. “Over the following weeks and months, we increase the requirements and in doing so shape the market.”
Councils are able to search a list of providers for those that have been accredited by the alliance so that referrals are only made to those awarded accreditation.
Redbridge Council says such a scheme illustrates the strength of a collective response to the concerns around unregulated accommodation.
