Of course central government should take strategic responsibility for giving all young people the right start in life but it will not, any more than it has done for as long as I can remember. The Independent Review of Children’s Social Care in England is but the latest in a long line of initiatives.
Meanwhile, local government has a current and worsening crisis with insufficient capacity, spiralling costs, especially for children with complex needs, statutory duties it struggles to fulfil and increasing budget deficits. It has to find solutions. No-one else will.
Chief officers must take a deep breath, find time and resource to come off the current treadmill of crisis management and focus on delivering longer term answers. A re-think of the current approach is fundamental. Castigating the private sector and imposing price caps are not solutions (as shown by the energy sector).
Focusing initially on increasing places in residential care for hard to place children by achieving new provision which is near to home will deliver massive benefit. This includes financial benefit via well-structured procurement.
Why are the private and voluntary sectors not delivering enough new provision when research shows that profits are up? In a conventional market, shortage of provision is filled by new supply so why not here? What inhibits this, what are the drivers for new provision in your area?
Reasons for the reluctance to provide sufficient increased provision to meet sector requirements include, the nature of the market, with income from authorities described as fragile in the Revolution Consulting Report cited at the bottom of this article and the pattern of purchase. Revolution Consulting identifies elsewhere that 82% of residential purchases are spots. Anecdotally, blocks may succeed because of individual working relationships, not sound commissioning/procurement models and some blocks with poor documents and relationships fail.
Spots offer no guaranteed income stream to support borrowing, investment in a long-term commitment to staff or committed partnership working, even though in practice there may be a long-term relationshipswith individual authorities. Spots encourage an opportunistic approach, and providers may not know which authority will purchase their next vacancy.
Threats of price capping also inhibit achieving new investment. Investment is a long term commitment. If there is future price capping, providers and their backers may not get their money back as the debt cannot be funded. Negative comments about providers are equally unhelpful.
There is a chronic shortage of staff, especially senior staff. The spot model makes it more difficult to offer long term commitments to staff.
I am not suggesting that the above is typical everywhere, it just puts in focus why providers may be untrusting and insecure about their longer term future and are opportunistic, focusing on increasing short-term profits.
New places alone are not a solution. Authorities must stop these being snapped up by their desperate neighbours. A flexible (or soft) block with a contractual commitment to purchase a number of places at an agreed fee, for sufficient years to support provider investment (eg ten plus) achieves this. The contract is supported by an output specification setting out the obligations of each party to support the placements and children. A key objective is to meet the immediate needs of the most complex young people and prepare them to move on to less intensive and less expensive provision. The purchasing model offers the opportunity for either party to vary the block commitment. Fee levels would be realistic in return for the commitment. With the fair contract terms and a sophisticated pricing model, savings of a significant percentage (compared to current cost) are achievable. An offer of land and premises with support for achieving planning permission for change of use may help smooth the path to new provision as well as showing good will and commitment.
A recent market consultation as part of a Department for Education funded pilot project (Phase 2, South East Sector Led Improvement Programme) addressing sufficiency challenges for looked after children I was part of and other initiatives suggest there is a positive appetite in the private sector to work with local government in a collaborative manner. This project is arguably unique in being co-produced, with provider organisation representatives as an equal partner. The intention is to deliver an innovative model of care through developing relationships in which all bring their skills, expertise and imagination to a shared mission, underpinned by shared values and beliefs. Providers respond positively when asked for views about a solution offering the possibility of medium term block contracts supported by relationship working with authority partners.
Additional provision will not happen without a radical re-think including a different mind-set. Local government and the private and voluntary sectors must talk to each other and stop seeing the other as enemy. I say take a deep breath and try something different as the current commissioning and procurement models are broken.
Léonie Cowen is a solicitor and principal of Léonie Cowen & Associates. She is an expert in social care procurement.