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John Jolly
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DOWNHILL
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Our procurement, tendering and
commissioning processes are
unacceptably poor, says
John Jolly
I’VE BEEN SHARING CONCERNS FOR YEARS
with other CEOs and senior managers about
poor procurement and tendering in the drug and alcohol sector – usually just quietly,
over meetings with coffee. When I spoke recently to Martin Barnes, CEO at Drugscope,
the umbrella organisation for the field, we shared long-standing worries about the state
of commissioning in many areas.
To really address the issue, however, we need evidence of the impact on staff and
organisations, and examples of poor practice and waste. How much does it cost service
providers to tender? How much money do commissioners spend on consultants? We
cannot just complain about the process; we have to demonstrate its impact, unfairness,
and consequences for service users and on service provision and quality. It is perfectly
legitimate for local authorities to retender work provided to them by contractors, but in
the context of Big Society there needs to be a level playing field for the third sector and
local third sector providers.
Poor and frequent commissioning has a number of serious consequences, not least of
which is the cost. An exercise to quantify the costs of tendering services more than years
ago came up with a figure of £300,000 expended by all bidders and the commissioner
per tender.
We have to accept that tendering of services is here to stay and that providers will all
win and lose contracts. However, I think there is a case to be made to increase from the
standard three-year contract to a seven- to- ten-year minimum contract length – or
possibly longer.
The contracts are often very one sided and allow cancellation with three or six
months notice. Often providers are asked to agree to the contract as a condition of being
allowed to tender, which is clearly unfair. Contracts need to be far less easy for local
authorities to wriggle out of, with an expectation that any but the most major changes
required are done via contract variation rather than retendering, except where there are
clear performance issues.
At Blenheim we are concerned about the minimum turnover requirements that are
beginning to affect the ability of small providers to tender for contracts they currently hold.
This is where to bid for work you have to have a minimum turnover of, say, £5m or £10m. I
am aware of many smallish and medium-sized charities that have not been able to bid for
their own contracts back in their own right, forcing them into shotgun marriages with
other providers as junior partners. This has on occasions included Blenheim, despite us
being in the top 750 charities in the UK by income out of 66,000 charities.
Partnerships have a lot to offer and Blenheim is in many great and highly effective
partnerships, but they rarely work well when they are marriages of convenience.
Blenheim is concerned that we are starting to see the demise of local third sector
organisations operating and attuned to local communities, and their replacement by
profit-motivated or organisational-survival-motivated or growth-driven organisations.
This I already hear and see impacting detrimentally on service provision.
Blenheim is concerned about minimum standards in the drug and alcohol sector, with
the move to local authority commissioning and the demise of the National Treatment
Agency. Providers are all being forced to compete on price rather than quality, and this has
a direct impact on who is employed or made redundant. The people that service providers
employ and their skills and ability is what makes the difference to the mothers, fathers,
children, sisters, uncles, neighbours, friends and grandparents with a drug or alcohol
problem that we are here to help. These people deserve a quality service, delivered against
exacting standards of performance and staff competence, not the cheapest available.
Blenheim is deeply troubled about the many instances of poorly managed tendering
processes which create huge wastes of time and effort both at commissioning level and
within provider organisations. This is now a regular occurrence and issues have included
unfair decisions, lack of transparency about the process, and lack of knowledge about
tendering and procurement within tendering teams. A number of tendering processes
have to be suspended due to flaws in the process, and there is complete lack of
understanding by many commissioners of TUPE rules. There are attempts to dump
significant pension liabilities on incoming organisations where the NHS or local authority
is the outgoing organisation, and there are sometimes completely ludicrous and
unworkable specifications. Local authorities often transfer risk to providers via payment
by results with poor data to assess risk – often in relation to performance targets the
provider has little control over.
At Blenheim we think its time we should stop talking and start acting, as a provider
and a sector, to raise these concerns via DrugScope and other forums.
John Jolly is chief executive of Blenheim CDP
www.drinkanddrugsnews.com
20 |
drinkanddrugsnews
| August 2013