Service Reviews â Outline Business Case - Somerset County Council

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(Cabinet – 2 May 2012) C and D D increase NHS Somerset COSTS Funding available for programme is insufficient to meet the cost of procurement/ transfer Cost of reconfiguring the service is priced into bids resulting in a higher costs to SCC over the lifetime of the contract than if the reconfiguration was undertaken in-house Teckal and there may be opportunities to mitigate across both options through SCC’s interest in property assets. This will need further consideration as part of the development of the full business case should this option be taken forward. 2 Examine in likely costs in detail as part of full business case development if these options are taken forward 2 Undertake as much reconfiguration as possible/viable/economic inhouse so that the service is outsourced with costs already reduced 3.4.5 Conclusion The main benefit of this option is that it can provide opportunities for customers to personalise their services through the use of Direct Payments which offer choice and control. Some of the properties are not fit for purpose and this option gives us an ability to favour bids that include capital investment to develop accommodation that supports quality care delivery. It would also allow the service to be transferred out of the County Council without the need to comply with Teckal and the restrictions that this imposes on providing services to a third party. While there is potential to realise some efficiencies and savings this is not considered to be significant as a result of on-going work to reconfigure services. Depending on the successful bidder there could be opportunities to share overheads across a wider range of services, including private provision. While the risk of an external provider failing cannot be completely discounted, this can be effectively mitigated through a robust procurement process that takes into account service quality as well as cost and supplier robustness. In addition, consortium bids could be encouraged that would facilitate the participation of small providers that might be “crowded out” by other options, There are two key risks that require further exploration as part of the full business case. The first relates to potential cost escalations following the transfer, which could be mitigated in part by undertaking full reassessments of all care packages. The second relates to any external partner offering spare capacity to people who live outside of Somerset who go on to become “ordinary residents” requiring SCC to fund their places as well as extra costs for NHS Somerset. This is a risk that could be mitigated though SCC’s interest in property assets along with robust and adequately resourced contract management. 3.4.6 Recommendation To develop this option into a full business case A - 30
(Cabinet – 2 May 2012) 4 Impacts of Options See Appendix C 5 Interdependencies The LDPS is a jointly commissioned service with the NHS, with SCC acting as the lead commissioner. Any decision to externalise or outsource would therefore need to agreed by both the SCC Cabinet and the Somerset CCG/ NHS Somerset Board. The outline business case will be considered by the clinical commissioning group who will make recommendations to the NHS Board. 6 Next Steps To develop full business case ahead of final decision, this will require: • Development of full business case incorporating: blueprint for each option taken forward the results of a full 12 week public consultation plus a minimum of 2 weeks either side to set up and analyse responses (depending on the volume of responses and the point in the processes when they are achieved, dedicated resources could be needed to achieve this turnaround) Consultation with partner agencies and the Clinical Commissioning Group Consultation with staff and unions Parallel work to identify best-fit legal vehicle for externalised service if this option is taken forward Parallel market testing and shaping to identify viability of whole service outsourcing, if this option is taken forward Parallel work to develop requirements for a Service Plan should the option for the service to remain in-house be taken forward Parallel detailed costing exercise Parallel work on VAT and pensions implications Parallel work to update impact assessment • During this period it is recommended that reviews of residential and supported living accommodation should continue to identify any “quick wins” in these areas which make up 75% of the service cost and to ensure that the services provided meet service needs We anticipate that a full business case could be competed by September should a decision be taken on the Outline Business Case by both SCC and the NHS by the beginning of the week commencing 7 th May, and the required resources being available to undertake the work outlined above. This would then need to be followed by consideration by the Clinical commissioning Group and NHS Somerset Board and constitutional consultation processes with elected members on the completed document and before a final decision is taken. A - 31
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Service Reviews â Outline Business Case - Somerset County Council