Service Reviews – Outline Business Case - Somerset County Council

(Cabinet – 2 May 2012)
• Want to do: These would be services meeting needs that are not FACS
eligible, but would be beneficial to provide for other reasons such as preventing
future need. In LD services this tends to be employment support services. For
the majority of customers these employment support services provide a cost
effective alternative to Day /Respite services which would need to be provided
to meet FACS eligible needs, and provides vital support for many carers.
1.3 Comparison of current service costs with the market
Soft market testing undertaken as part of the options appraisal conducted in
2010 10 indicated that the LDPS offered good value for money for care and support
for people with the most complex needs, but was potentially not as good value for
people with less complex (but still FACS eligible) needs.
We are undertaking a more detailed analysis of Supported Living and Residential
services to compare both quality and value for money against the market. A full
analysis of this data will inform the Full Business Case. We have begun this
process and have looked at four individual supported living services, operated by
the LDPS. Early indications suggest that:
• The current hourly rate for care and support is higher for the LDPS than that
currently charged by existing external providers of similar services. The
difference in rates, including an overhead rate of 15% 11 added to the LDPS
(SCC) rate to enable comparison, is summarised in the following table.
SCC 12 SCC 13 2012 2012 2012 2012
2012 2014 Provider 1 Provider 2 Provider 3 Provider 4
£17.18 £16.85 £14.85 £16.10 £15.82 £15.93
Table 1
• The future hourly rate that could be achieved once all planned service redesign
is completed indicates that SCC may reduce their rate to £16.85 (£16.50
removing the SCC pension’s shortfall liability).
• We are currently discussing the likely timeframe to achieve this rate with the
provider service but it is likely to take until 2014 as a result of changes being
made through staff turnover.
• The Supported Living service represents 47% of the LDPS spend.
10 SCC Cabinet meeting held on 20/10/2010. Paper C, Appendix E “Soft Market Testing Analysis”
11 External partner rates include all overheads, where as the in-house rate does not include SCC corporate
overheads. Although a 15% rate was used to enable a comparison the actual SCC overheads rate applied
to the LD Service is likely to be higher.
12 Note: removing the SCC pension fund shortfall liability (enabled through externalisation) reduces the SCC
rate in 2012 to £16.76.
13 Projected hourly rate based on structural changes already in progress. Note: removing the pension’s
shortfall liability reduces the projected SCC rate in 2014 to £16.50.
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