Agenda item

(To receive a report from Sophie Reeve (Chief Commercial Officer) which invites the Overview and Scrutiny Management Board to consider a report on the Commissioning and Commercialisation Strategies, prior to consideration by the Executive on 3 July 2018)

Consideration was given to a report by the Executive Director of Finance and Public Protection which invited the Board to consider a report on the Commissioning and Commercialisation Strategies, prior to the consideration by the Executive on 3 July 2018.

Sophie Reeve, Chief Commercial Officer, introduced the report which would ask the Executive to approve the content of the Commissioning Strategies as presented at Appendix B and the Commercialisations Strategy at Appendix D.

The Board considered the report in two sections, the first section taken was Commissioning.  It was explained that LCC was a commissioning council and, within the Business Plan, the defined purpose was to include commissioning for outcomes based on the needs of the community. 

In 2017, further work was undertaken to simplify commissioning and to review Member involvement so that senior members had early sight of proposed outcomes, services and how they might best be delivered.  This work resulted in a 'Minimum requirements for Commissioning Strategies and Plans' which commissioners followed.  The document was included in the report at Appendix A and it was further explained that although the strategies and plans had minimum requirements, how they were met was not prescribed.

The Board was asked to note that the Commissioning Strategies for Adult Care and Community Wellbeing; and Public Protection and Communities had not yet been through the scrutiny process.

During discussion, the following points were noted:-

·       It was agreed that the Commissioning Highlight Report did not best reflect the performance as it only reported if a target had been achieved or failed.  For example, if a target was 70%, it reached 69% but this had improved from the previous report, it would still be reported as failed.  It was agreed that future reports would indicate the direction of travel to give the Board a fuller picture;

·       Confirmation was given that quality assurance was fully explored before any contract was awarded.  In terms of value for money, the commercial terms of a contract would need to be considered at the same time as the contract itself;

·       The intent was to make the process more transparent and inclusive of Members given the increased amount of contracting within the Authority;

·       The Commissioning Strategy was a high level document and procurement would be done at a much lower level.  It was reported, however, that an amendment clause could be included in the contract to enable flexibility should requirements change;

·       A suggestion was made that a summary document, which concisely explained how and why decisions in relation to contracts had been made, be produced.  This would then assist Members in the future, following elections, to understand why decisions had been taken.  It was agreed that this could be included as part of the wider commercialisation;

·       An error was reported on page 82 of the agenda pack.  The achievement target for "Closing the Gap Early Years Foundation Stage Profile" was 19% but the actual performance was 20% and reported as 'achieved'.  In this particular case, a smaller percentage was required, therefore this indicator was 'not achieved';

·       The Commissioning Board had also focussed on the outcomes of the strategy work and whether officers had brought forward the correct outcomes for scrutiny.

The introduction continued with the Commercialisation Strategy which set out different categories of commercialisation.  Arranged on a continuum, depending on the degree of risk, the activities were:-

·       Adopting a commercial mind set and displaying commercial acumen and discipline;

·       Being productive in everything we do for ourselves;

·       Increased focus on how we buy goods and services including procurement, contract management, shared services arrangements;

·       Maximising the return on our assets;

·       Covering our costs through charging;

·       Trading our services; and

·       Investing.

All authorities were in discussions about commercialisation and the relevant drivers.  The Board was advised that when the Council first looked at commercialisation there was a considerable information resource from other authorities to draw on.  A customer service ethos was specific to Lincolnshire in addition to risk management. 

It was proposed to bring an update report back to the Board in six months.

During discussion, the following points were noted:-

·       Appendix A appeared to contradict itself in relation to the Energy from Waste (EfW) plant and it was explained that the site had met the efficient and effective approach in relation to use of all the capacity rather than landfill but that the investment asked in relation to finding a market for the heat produced by the plant was yet to be achieved;

·       'Charging for the use of Council procurement frameworks' was also amber and it was asked to what extent the Council was in competition with ESPO.  It was explained that ESPO focussed on goods such as stationery and equipment and the Council focussed on services therefore it was a different market place with little, or no, competition;

·       "The Customer Service Ethos is at the heart of everything we do.  Our starting point is always to remember that we are a local authority.  We have statutory obligations that we must fulfil including to support and safeguard our most vulnerable residents" was a statement included within the Commercialisation Strategy.  The Board supported this statement and asked that it also be included within the Minimum Requirements document of the Commissioning Strategy;

·       The Board highlighted the need to strengthen the wording at bullet point 10 of the 'Commercial Model' section of the report to amend the word ' should' to 'must', i.e. "The contingency arrangements which will be available in the event of provider failure which must be proportionate with the risk and scale of failure" and "Commissioners must also make provision for adequate contract management on external arrangements so that transition and contract management on external arrangements;

·       The Board also highlighted the need to ensure that reasonable consideration was given when determining the delivery model for commissioned services, e.g. outsourced or insourced.

The Chairman summarised the discussions and it was agreed that the following comments be passed to the Executive as part of consideration of this item:-

1.    The Board supported the following statements included in the report and Commercialisation Strategy – "the Customer Service Ethos is at the heart of everything we do.  Our starting point is always to remember that we are a local authority.  We have statutory obligations that we must fulfil including to support and safeguard our most vulnerable residents", and requested that this statement also be included as part of the Commissioning Strategy Minimum Requirements Document;

2.    The Board highlighted the need to ensure the Commissioning Strategies and Commercialisation Strategy captured organisational learning to ensure lessons learnt were carried forward to ensure future resilience;

3.    The Board highlighted the need to strengthen the wording at bullet point 10 of the 'Commercial Model' section of the Commissioning Strategy Minimum Requirements Document and in the final paragraph of the that report to amend the word 'should' to 'must', i.e. "the contingency arrangements which will be available in the event of provider failure which must be proportionate with the risk and scale of failure" and "Commissioners must also make provision for adequate contract management on external arrangements so that the provider can be held to account".  This was to ensure provision for adequate transition and contract management on external arrangements; and

4.    The Board highlighted the need to ensure that reasonable consideration was given when determining the delivery model for commissioned services, e.g. outsourced or insourced.

RESOLVED

1.    That the recommendations to the Executive, as set out in the report, be supported;

2.    That the additional comments, as noted above, be presented to the Executive for their consideration; and

3.    That an update report be added to the Work Programme of the Board at an appropriate time, to be determined by the Chief Commercial Officer.