mark poppy and anne jarrett · • develop your evaluation criteria for the long-and short-listing...

Commercial expertise driving value and efficiency in local public services

Making The Right Choice

Mark Poppy and Anne Jarrett

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About you…

Who you are

• Your role and organisation

• Issues keeping you awake

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About Local Partnerships

Our mission

Local Partnerships mission is to enhance the quality of people’s lives by giving trusted,

professional support to local public bodies to improve their ability to source and deliver

high quality, cost-effective public services and Infrastructure

What are we?

We are jointly owned by HM Treasury and the Local Government Association. We

provide the public sector with commercial expertise and know-how.

Who do we work with?

We work with all Councils, local authorities and public service providers.

Options appraisal and new models

We have a raft of experience in supporting local public bodies through the options

appraisal process and implementing their preferred model of delivery

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Options Appraisal

Provides a framework for:

• Identifying the different ways outcomes might be achieved

• Systematic process

• Evidence informed case for change

• Transparency : sharing the decision making process and outcomes

with others

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Typical Activities in an Options Appraisal

• Establishing the strategic need.

• Establish the range of resources available.

• Establishing the key outcomes and objectives you want to achieve in terms of meeting

the strategic need.

• Establish your „do minimum‟ or “baseline” position.

• Establish your organisation‟s position on risk transfer.

• Develop your evaluation criteria for the long-and short-listing process.

• Identify the full range of options, which may be available to deliver your desired

outcomes and objectives.

• Create a short-list from a high level option appraisal.

• Evaluate fully the short-listed options against the evaluation criteria.

• Progressing the preferred option

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Overview of the options appraisal process

Go

vern

an

ce

Sta

keh

old

er

en

gag

em

en

t

A successful options appraisal requires thoughtful planning, methodical delivery, proportional governance and excellent stakeholder engagement

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Options Appraisal – Overview

long

list

of

potential

options high level

financial &

non-financial

criteria

short

list

of

potential

options

preferred

option

detailed

financial &

non-financial

criteria

strategic assessment & review

aims and objectives

council-wide

sector-specific

‘

project-specific

service aims and objectives


The Strategic Context

A key influence on choice

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Service Spending as proportions of overall budget

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Politics

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Public sector reform

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What next for the big society?

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Capacity

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Key Themes

• Increased efficiency and quality: better value for money and improved

outcomes

• Reducing demand: investing in prevention, reablement, individual

responsibility

• Greater control and choice: decentralisation, community budgets,

personalisation

• Big Society: Re-invigorated community and voluntary sector, leveraging

social capital within communities, local responsibility

• Co-production: involving users in the design and evaluation of services

• Service integration, greater working across service providers (LA and

NHS), single point of access, community „hubs‟

• Partnership working: joint strategic and operational relationships across

public bodies and with third and private sectors

• Transformation: „whole system‟ sustainable change

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Need for Clarity About Strategic Objectives

Cost savings

Service improvement

Improve resilience

Innovation

Share best practice

Access to skills

Transfer risk

User focused

v Income generation

Share ICT systems

Service prioritisation

Better Value for Money Need for flexibility

Wider choice


Strategic Commissioning

A key context to manage

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Priorities

Needs

User

Delivery

options

Review

Delivery

Se

rvic

e d

eliv

ery

B

usin

ess c

ase d

evelo

pm

ent

Strategic commissioning model

Procurement

Communities

Resources

Monitoring

l

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NAO Model Of Commissioning with the Third Sector

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Commissioners and providers have considerations

that (should) mirror each other

Needs

Assessment

Specification of

services to

procure - engage

with market

Procurement of

Services

Contract

administration &

performance

management

Commissioning Provider Considerations

What is core

business?

Gaps against

the

specification?

• What integrated pathways should I work in?

• What role for the business in these integrated pathways?

• How do I find out what commissioners want from service delivery?

• How do I fill those gaps - who do I partner with or what should I

develop?

• What criteria should I use to identify medium/long term partners?

Assembling the

bid

• What services/activities would I provide versus partner providers?

• Where do we overlap and where are we adjacent?

• How do we manage the interface between overlaps/adjacencies?

Delivery

• What are the protocols for how a service user moves through the

care pathway?

• Is risk proportionate and distributed fairly between providers?

• Are incentives and penalties correct?

3-5 Year Contract


Appraisal Criteria

Some issues for consideration

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How are you going to ‘judge’?

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Developing Appraisal Criteria

• Developed from the CLEAR (short and focused set ) objectives

that have been set for the future of the service

• Used to test how each of option is able to meet future objectives

and requirements of the service (and of the Council)

• Differential weighting might be identified (to reflect priority)

• Common key themes around which you might expect criteria to

be developed

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Some Potential High Level Appraisal Criteria

• Improved quality of service

• Improved efficiency

• Quality of employment

• Corporate impact on the authority

• Sustainability and growth

• Added value

• Speed of implementation

• Flexibility/scope for collaboration

• Governance (LA „control‟)


What Are The Choices

Models and legal entities

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Main Models

• In House provider

• Third Sector Social Enterprise (created from an in house operation)

• Third Sector Social Enterprise (already existing)

• Private Sector Operator

• Joint Venture

• Shared services

• Mixed economy

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THIRD

SECTOR

Voluntary &

Community

Organisations

Charities

Mutuals Cooperatives

Social

Enterprises

Organisations based on the

principle of mutuality. It is owned

by its members, who derive their

right to profits and votes through

their customer relationship

Non-profit making

organisations

generally refer for

public charity

Autonomous association of

persons united to meet

common economic, social,&

cultural needs

Businesses trading for

social & environmental

purposes An independent, self-

governing body of

people who have joined

together voluntarily to

take action for the

benefit of the

community

'Third sector commission &

English Local government

procurement‘ Presentation by J.

Gordon Murray, 2009

http://www.scottishlife.co.uk/scotlife/Web/Site/AboutUs/Mutuality/Mutuality.asp

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Consideration of Legal Entity

• Company Limited by shares

• Private Company Limited by Guarantee

• Community interest Company (CIC)

• Industrial and Provident Society (IPS) for Community Benefit

(BenCom)

• Limited Liability Partnership


Undertaking the Appraisal

Who to involve

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Who Should Undertake the Appraisal?

• Politicians

• Senior Managers

• Commissioning staff

• Service staff

• Other staff within the organisation

• Service users

• Members of the public

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Getting the ‘Right’ Project Structure

Project governance

Stakeholder

Board

Internal

Legal

External

Technical

External

Financial

Internal

Service

Group

Internal

Financial

External

Legal

Project Team

Local

Partnerships

Project

Manager

Strategic

Project

Board

Project Owner

Council Approval Processes

Project Director

Corporate

Procurement

Risk

Management

Human

Resources

Contract

Manager

Public

Relations Audit

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Appraisal bias

1. Failure to fully assess current performance to identify strengths and weaknesses

2. Undervaluing and under-estimating the capacity of the authority to achieve change

whilst simultaneously overstating capacity and track record of private or voluntary

sector

3. Inadequate and selective research

4. The appraisal does not establish the business need for the preferred option

5. The identification of transitional and permanent costs is incomplete

6. Evaluation of options transparent and is biased against the in-sourcing and public-

public collaboration options

7. Appraisal displays a lack of understanding of the economics and market forces

operating within the sector


What Are The Issues For You?

Discussion

mark poppy and anne jarrett · • develop your evaluation criteria for the long-and short-listing...

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