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From NAVCA09 conference in Blackpool.

Workshop delivered by Susan Steed from New Economics Foundation.

Published in: Technology, Economy & Finance
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  • Set Background – Gershon efficiency savings. Problem 1: Unit cost tells you nothing about quality. Financial measurement has not served us well, with a limited measure of value. Accounting never intended as an exact science, misinterpreted as so.
  • Commissioning became focused on the relationship between inputs and tightly specified outputs Focus on narrow outputs can miss opportunities to maximise public benefit across social, environmental outcomes. A provider, particularly CVS, may be creating value (e.g training volunteers, working with hard to reach people, etc). This also misses many interactions between the way services are delivered, and the the outcomes that come from those services.
  • Those on whose behalf policies are formulated are excluded from decisions Indicators are not relevant to the people whose lives are supposed to be changed by policy, so we measure the wrong things (the failure of top-down, siloed targets) Engage with stakeholders, particularly CVS. Service specifications framed in terms of narrow outputs are barriers to innovation by providers and service users.
  • SROI UK OTS funding SROI becoming the industry standard in the third sector Need to push the boundaries and apply it to other sectors so that pursuing public benefit becomes the norm for all organisations. Limitations? Proxies will be subjective Doesn’t allow to compare apples and pears Only as good as data that goes in Criticising numbers and using them?
  • The sustainable commissioning model returns to a treasure def of VfM.
  • Commissioning for Outcomes is only half the story. Need to measure outcomes too. Introduce the outcomes star. Refer to Triangle if more questions.
  • Emphasise that SCM is LEGAL.
  • Go through each of the steps in detail, possibly add more slides…
  • Story of unintended consequences of cost cutting
  • Commissioning

    1. 1. Sustainable Commissioning NAVCA Susan Steed nef (the new economics foundation)
    2. 2. Outline <ul><li>Background to Commissioning for Public Benefit </li></ul><ul><li>Camden Model </li></ul><ul><ul><li>Theory </li></ul></ul><ul><ul><li>Practice </li></ul></ul><ul><li>How to influence the Commissioning Process </li></ul>
    3. 3. Problem 1
    4. 4. Problem 2 Tend to measure what we can count What get’s measured is what gets valued What get’s valued is what we pursue The things that matter most to us get left out
    5. 5. Problem 3
    6. 6. The result <ul><li>Poor management of resources  triple crunch: </li></ul>The environment The economy People
    7. 7. In summary… <ul><li>We are in danger of creating … </li></ul><ul><li>FALSE ECONOMIES </li></ul><ul><li>e.g. Investing in higher quality residential care for children </li></ul>
    8. 8. How does Sustainable Commissioning Help Us? <ul><li>A framework for measuring what matters </li></ul><ul><ul><li>Triple bottom line </li></ul></ul><ul><ul><li>Giving voice to those normally excluded from decision-making </li></ul></ul><ul><li>Basis for debating the allocation of (scarce) resources to maximise social, environmental and economic outcomes </li></ul><ul><ul><li>Organisations </li></ul></ul><ul><ul><li>Society </li></ul></ul>
    9. 9. Treasury Definition VfM <ul><li>Quality and whole of life costs </li></ul><ul><ul><li>“ VfM is defined as the optimum combination of whole-of-life costs and quality (or fitness for purpose) of the good or service to meet the user’s requirement. VfM is not the choice of goods and services based on the lowest cost bid .” HM Treasury (2006) Value for money guidance </li></ul></ul><ul><li>Wider cost and benefits </li></ul><ul><ul><li>“ Wider social and environmental costs and benefits for which there is no market price also need to be brought into any assessment. They will often be more difficult to assess but are often important and should not be ignored simply because they cannot easily be costed.” HM Treasury Green Book </li></ul></ul>
    10. 10. <ul><li>THE Camden MODEL </li></ul>
    11. 11. Sustainable Commissioning outcomes framework <ul><li>5. </li></ul><ul><li>Value </li></ul><ul><ul><li>Quantitative </li></ul></ul><ul><ul><li>Qualitative </li></ul></ul><ul><ul><li>Monetizeable </li></ul></ul><ul><li>Where value accrues: </li></ul><ul><ul><li>To Service </li></ul></ul><ul><ul><li>Camden wide </li></ul></ul><ul><ul><li>central government </li></ul></ul><ul><li>4. </li></ul><ul><li>Camden Community outcomes </li></ul><ul><ul><li>social </li></ul></ul><ul><ul><li>economic </li></ul></ul><ul><ul><li>environment </li></ul></ul>3. Service level outcomes 2. Output 1. Activity Community strategy & Corporate priorities Commissioner & service user priorities National outcome frameworks
    12. 12. Asking the right questions <ul><li>Service Level Outcomes </li></ul><ul><li>Service Users </li></ul><ul><li>Have enhanced psychological well being </li></ul><ul><li>Have enhanced Physical well being </li></ul><ul><li>Find meaningful employment, training or voluntary work. </li></ul>
    13. 13. Asking the right questions <ul><li>Community Level Outcomes </li></ul><ul><li>Social Outcomes </li></ul><ul><li>Community Cohesion </li></ul><ul><li>Reduced Crime </li></ul><ul><li>Economic Outcomes </li></ul><ul><li>Stimulate small firms, BME businesses, social enterprises & CVS </li></ul><ul><li>Reduce worklessness & economic inactivity </li></ul><ul><li>Environmental Outcomes </li></ul><ul><li>Reducing waste </li></ul><ul><li>Reducing energy usage & CO2 emissions </li></ul><ul><li>More recycling of goods </li></ul>Social Economic Environmental
    14. 14. Asking the right questions <ul><li>Co-production </li></ul><ul><li>Within the service specification we asked; </li></ul><ul><li>What role would you envisage for service users’ in the development and delivery of your service? </li></ul><ul><li>How does your service identify and mobilise service users strengths? </li></ul><ul><li>How would the contribution of service users, carers, family, peer group, neighbours and the wider community be measured or rewarded? </li></ul>
    15. 15. Outcomes of the tender process <ul><li>Consortium of 3 medium-sized locally based 3 rd sector providers </li></ul><ul><li>Not cheapest </li></ul><ul><li>Commitments to: </li></ul><ul><ul><li>Community Outcomes </li></ul></ul><ul><ul><li>Co-production </li></ul></ul>
    16. 16. Tracking outcomes – Outcomes Star
    17. 17. Challenges for commissioners <ul><li>Culture change - outcomes rather than outputs </li></ul><ul><li>Institutional context often incentivises narrow interpretation of Value for Money: </li></ul><ul><li>Recognising savings across the council, and wider – getting information on budgets and budget holders </li></ul><ul><li>Attribution – how do we know this service created this impact </li></ul><ul><li>Commissioning for outcomes vs monitoring for outcomes. </li></ul>
    18. 18. Challenges for providers <ul><li>Training and capacity building esp. for smaller 3 rd sector orgs </li></ul><ul><li>Raise awareness of wider impacts </li></ul><ul><li>Partnerships with other providers </li></ul><ul><li>Co-production: a trusting relationship between commissioner, provider & service user </li></ul><ul><li>A lack of outcomes data evidence to present at tender stage. </li></ul>
    19. 19. How to encourage your local authority to use SCM <ul><li>Sustainable Commissioning has the following features: </li></ul><ul><li>bottom up approach to commissioning which fosters, rather than stifles, innovation . </li></ul><ul><li>focus on outcomes , rather than narrow output targets, focuses investment on what matters. </li></ul><ul><li>maximises every pound spent by the public purse by achieving wider social, economic and environmental outcomes and encouraging cross-departmental savings .  </li></ul><ul><li>levels the playing field between the third sector and other providers because effectiveness , rather than unit cost, becomes the key consideration. </li></ul>
    20. 20. How to encourage your local authority to use SCM <ul><li>Top Tips: </li></ul><ul><li>Get up to speed with the Compact and the Community Strategy </li></ul><ul><li>Legal issues </li></ul><ul><li>Effectiveness and value for money </li></ul><ul><li>Deliver with service users. </li></ul><ul><li>Engage with every level of the commissioning process – see next slide. </li></ul>
    21. 21. Getting impact in to the procurement process
    22. 22. Developments <ul><li>Camden </li></ul><ul><li>Links with other commissioning frameworks and personalisation agenda. </li></ul><ul><li>Advice UK </li></ul>
    23. 23. So What?
    24. 24. Further information <ul><li>Sustainable Commissioning: [email_address] </li></ul><ul><li> </li></ul><ul><ul><li>A Better Return: Setting the foundations for intelligent commissioning to achieve value for money – I&DeA & OTS Third Sector Commissioning Programme </li></ul></ul><ul><ul><li>Measuring real value: A DIY guide to Social Return on Investment </li></ul></ul><ul><ul><li>Unintended Consequences </li></ul></ul><ul><ul><li>Coproduction Manifesto </li></ul></ul><ul><li> </li></ul><ul><li> </li></ul>