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SUMMARY

Leicestershire County Council provides a wide range of services to over 600,000 residents split between small urban areas, extensive suburban areas and rural settlements.

The Council used a creative approach to procurement and contracting to develop a Children’s Innovation Partnership, the first of its kind in the UK.

The council used freedoms enabled by the 2015 public contract regulations, specifically ‘light touch’ procurement and the development of bespoke solutions to commission before complete awareness of the service and outcomes it needed to procure.

It designed a two tier contractual framework to procure a design partner with provider potential.

The partnership has been described as a “learning partnership rather than a traditional commissioner – provider relationship,” and has already generated millions of pounds of new income for projects that improve outcomes for children.

BACKGROUND

In 2017 the council needed to save £54m by 2020/21, £3.7m of which needed to be achieved in children’s social care. Alongside this the number of Looked After Children (LAC) in Leicestershire was forecast to grow, resulting in an estimated cost increase of £14.7m in 2021/22.

The Council was sourcing Independent Fostering Services and Residential Care through a traditional framework. Due to poor market sufficiency there has often been a need to purchase off-framework at a much higher price with care packages dictated by the market rather than the child’s care plan.

The market is often inflexible in its approach to innovative care packages and less responsive to young people with complex needs. The MJ’s investigation ‘A broken market’ (August 2017) and the 2015 DFE report on the children’s residential care market highlighted these issues.

In response to the above challenges the council developed a Care Placement Strategy which aims to more effectively manage the LAC system from edge of care through to leaving care.  In order to make these whole system changes it was acknowledged that the expertise of an external partner was needed.

DEVELOPING A NEW PARTNERSHIP APPROACH

Leicestershire’s Children’s Innovation Partnership (CIP) was prompted by strong drivers in the external environment described above.

The Council responded with a “clearly articulated vision and case for change in Leicestershire, driven by strong leadership and accompanied by political support from local Members,” according to the Phase One Evaluation Report written by Dr. Julie Harris of the University of Bedfordshire and published in July 2020.

The Care Placement Strategy included a three-stage “Whole System Commissioning Services Design Model.

  1. Commissioning a Partner to support in co-designing, co-investing and co-delivering services
  2. Identifying opportunities to redesign services drawing on expert design teams drawn from
    both partners to produce new delivery models
  3. Developing a new relational commissioning model in collaboration with providers

Leicestershire Council sought to create a partnership with co-production, co-investment and co-delivery principles built-in. To do so, it:

  • Embraced the flexibility of the Light Touch Regime to engage with the market to develop a partnership model and a tender which aimed to assess the suitability of potential partners rather than a solution
  • Developed an innovative two-tier contractual arrangement for the CIP (unlike traditional social care contracts)

The first tier is underpinned by a collaboration agreement which sets out the governance and design processes. There are no costs associated with this agreement as both parties will provide experts to form a joint design team. Design briefs will be issued to this team who will use their collective expertise to design innovative services to meet the briefs.

The second tier covers the contractual arrangements for the delivery of services designed by the CIP. There are a range of options for service delivery including:

  • partner delivery
  • partner and council co-delivery
  • third party provider delivery.

The contractual term is up to 10 years and the contract value up to £704,000,000. The value is based on 2018/19 budgets for the whole of children’s social care. The intention is not to spend the full value through the CIP, however, setting the scope as wide as possible allows flexibility to design services across the whole social care system.

A key element of the CIP is the requirement for the partner to bring its own investment to children’s services. The longer contract length allows this to happen.

PROCESS

In developing the CIP, Leicestershire consulted with a range of stakeholders and specialists including service users.

An internal, cross-functional project group was set up with high level and specialist representation from across the Council. This group’s remit was to design the CIP model, oversee the development of the tender documents and evaluate the tender responses. This allowed a range of expert views to be taken into consideration including the director, assistant director and head of commissioning from Children and Family Services as well as representatives from Finance, Transformation, Commercial Services, Legal and Procurement.

The Council’s Cabinet Members and Corporate Management Team were kept informed on progress throughout the process.

The close working relationship between the children’s head of commissioning, the procurement specialist and the solicitor along with commitment from their respective teams to resource the project full time proved crucial in developing the CIP model, according to Liz Perfect, Head of Service – Commissioning & Planning for Children and Family Services at Leicestershire County Council.

Leicestershire also shared and tested ideas with a number of external organisations as part of the CIP model design process, including members of E3M’s Bold Commissioners Club and Social Enterprise Leaders Club, and Julian Blake, Partner (Charity & Social Enterprise Team) at Stone King LLP.

An extensive pre-procurement market engagement exercise was undertaken which involved a provider event, written submissions and dialogue meetings with a select number of interested providers.

A competitive tender process was launched after consultation and the opening of a dialogue with the market and, as a result of this process, Barnardo’s was awarded the Children’s Innovation Partnership contract in December 2018, establishing Barnardo’s as LCCs Innovation Partner. Whilst the tender was awarded under an Open Procurement regulation it was anticipated that the programme would operate as an Innovation Partnership. The term of the partnership was determined up to ten years, reviewed on a yearly basis.

During the course of the programme a range of Service Design Briefs was to be agreed through the Children’s Innovation Partnership Board (CIPB) which would revise LCC’s care offer for children. A Design Team, led by Barnardo’s and working with LCC and local organisations, would develop a response to each brief, the first of which would focus on children’s residential care.

The key objectives of the CIP are:

  • To co-design LAC services by sharing expertise and knowledge in the delivery of innovative solutions, contributing to transformational change through new and shared service delivery models
  • To co-deliver services that focus on outcomes and value for money
  • To co-invest in providing additional resources to review and develop new ways of working
  • To develop the system leadership and collaboration between different organisations necessary to drive innovative systems change.

Initial Findings

An extremely positive, independent, Phase One Evaluation Report (see above) found the CIP and innovation programme “have to date been marked by persuasive human behaviours driving change, motivated by a shared value base and bringing openness, trust, confidence and expertise.”

The report noted that in addition to establishing the partnership, in its first year “CIP activities generated some £1.9m of new income for projects that will improve outcomes for children and these represent unanticipated benefit arising from the partnership.”

Overcoming challenges

The biggest challenge, according to Liz Perfect, was converting the vision of a partnership with an external organisation, which has the flexibility to design and deliver services across a whole system, into a contractual model compliant with procurement regulations.

None of the available procedures would allow a partner to be appointed and deliver ongoing simultaneous design/service delivery. Therefore the flexibility within the Light Touch Regime was used to design a hybrid version of the open procedure. 

It was a challenge to define the scope in enough detail as required by the regulations without limiting the reach of the CIP. Research into contracting approaches not normally used in social care, discussion amongst internal experts and counsel advice allowed the solution to be reached.

As the solution reached is unusual the team experienced challenge from internal stakeholders and were able to mitigate each risk raised in order to successfully tender the CIP.

This is best described by Julian Blake, Partner at Stone King LLP;

“The Innovation Partnership concept was introduced in 2015 to promote purpose-aligned collaboration in public service. But no one in the UK took notice. Then, gradually, notice was taken, but no public authority was willing to pursue the idea, because no public authority had pursued the idea.

The project team recognised the purpose and potentially transformative value of relational partnership and pursued the idea tenaciously and relentlessly, addressing each, of many, barriers and obstacles, until all elements within the Council were converted, or persuaded, to the cause.

Combining the similarly under-utilised procurement provisions of the Light Touch Regime, purpose-aligned co-design, co-production and co-delivery principles were encapsulated in the appointment of an Innovation Partner, within the UK, closing down the risk averse line that it has not been done, so it cannot be done. That is true and courageous innovation, worthy of the name.”

What next?

5 Fundamental Correctives for Public Service Reform

Read about the Five Correctives here or click the buttons below for descriptions of the outcomes of, process behind, underlying principles, and evidence for each corrective.

9 Key Principles for working with purpose-aligned partners

Component principles for effective partnership working. Click here.

Tools, Resources and Model Documents

Example documentation, contracts, processes and agreements you can access – or use as a checklist as you progress your partnerships. These practical models and outlines include a set of social value imperatives.

Case studies of purpose-aligned partnerships

Examples of successful public service community partnerships delivering a variety of public services. See them here.

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