Scottish Government

11. Stage 5: Review

11.1 Introduction

This part of the guidance considers important aspects of the review stage including management of the local authority's relationship with service providers, service user and carer involvement and the interface with frontline practitioners, as well as other factors including:

1) Contract monitoring - user and carer feedback, and links with regulatory bodies;
2) Service Reviews - delivery against specification and contract;
3) Reporting;
4) Use of service provider forums;
5) Link with Commissioning Strategies.

Local authorities must manage their contracts with service providers effectively, ensuring that services meet their commissioning objectives and that best value is achieved. It is important that they use a monitoring and review process to report on the performance of services, and identify how improvements can be made. This process should also assess whether they have a sound approach to social care procurement, and identify how that can be improved.

The purpose of the Review phase of the procurement process should be to check whether the agreed outputs (what the service has actually delivered) and outcomes (what the effect of the service has been) have been achieved. This should include an assessment of the quality of the service and consideration of whether the service has been provided in the way that service users and carers wish. In addition this phase should consider whether the service provider's governance and management arrangements are functioning well and that the workforce is competent and well managed.

Contract monitoring and service review should be central to continuous improvement. It should measure the providers' and the services' performance and how this changes over time. The information from contract monitoring and review should both change and influence practice, from the specific care and support for an individual service user to broader improvements across a service. It should also influence the authority's commissioning strategies and approach to procurement.

11.2 Roles and Responsibilities

Within each particular procurement exercise it is important to be clear about governance, including roles and responsibilities both within the procuring local authority and the regulatory bodies, particularly the Care Commission. Local authorities should determine how Council staff will carry out their scrutiny responsibilities and ensure that service providers have robust governance arrangements in place for each service.

Whilst there will be diversity in service providers' models of governance, the principles of good governance - openness, integrity and accountability - should apply to all organisations. This includes having sound management arrangements for services, including procedures for planning, appraisal, authorisation and control (including budget control), accountability and evaluation of the use of resources.

To achieve best value, Local Authorities have a responsibility to ensure that contract monitoring and review is adequately resourced, thereby ensuring quality assurance for the support purchased for individuals and the use of substantial sums of public funding. As social services employers, local authorities also need to respond to the SSSC Code of Practice by ensuring that the staff involved in all aspects of procurement including contract monitoring and review are properly qualified and trained for this work.

Whilst there will be a diversity in service providers' models of governance, the principles of good governance - openness, integrity and accountability - should apply to all organisations. This includes having sound management arrangements for services, including procedures for planning, appraisal, authorisation and control (including budget control), accountability and evaluation of the use of resources.

11.3 Relationship Management

Local authorities and service providers have a common interest in achieving good outcomes for service users and carers. Effective partnership working between a local authority and service provider offers the best way to achieve good outcomes by providing a level of mutual respect, trust, fairness, flexibility, and shared responsibility. It is important therefore to consider how contract monitoring and service review can manage expectations and improve partnership working.

The establishment of a positive relationship between local authorities and service providers has many benefits. A transparent local contract monitoring and review process can help this relationship by building on existing relationships with service providers and avoiding unnecessary duplication and bureaucracy. Many social care service providers will have multiple contractual relationships with individual Councils and it is important to proactively manage these relationships to ensure:

• service improvement;
• innovation;
• flexibility and mutual benefit;
• economy and cost efficiency;
• public accountability.

All of these aims should be supported by relevant information generated from the performance monitoring arrangements that are required for each contract.

As agreed in the Third Sector Statement, voluntary organisations will maintain agreed monitoring, performance evaluation and reporting systems to ensure the efficient and effective use of public funding. This equally applies to private sector service providers and extends to ensuring that all providers will be open to providing timely relevant information about their performance. Scrutiny of service quality and performance is an integral part of the review process.

11.4 Stages and Methodology

The assumption made in monitoring provider performance is that service specifications and contracts have been established, which have the right user outcomes, are flexible and fair, and include defined quality indicators.

The process of monitoring and review can be considered against the three stages ⁷¹:

• Stage 1 - Preparation and Scoping
• Stage 2 - Contract Monitoring, Review and Reporting
• Stage 3 - Implementation

Some Councils already find it helpful to as set out their procedures and practice expectations for this staged process in a contract management framework, and establishing such a framework should be considered by all Councils.

Stage 1 - Preparation and Scoping

In relation to new and existing contracts, Councils should have a system of monitoring/information returns and service reviews, which is characterised as having:

• a clear purpose;
• the minimum of bureaucracy;
• a proportionate approach based on an assessment of benefits and risks;
• defined timescales.

Councils should also consider how the performance of a service is monitored with respect to:

• Social care procurement principles;
• The service specification and contract;
• Service delivery;
• Quality assurance;
• The risks associated with delivering services;
• Organisational capacity and capability;
• Workforce and financial management;
• Benchmarking performance;
• Regulatory grading and other information (e.g. Care Commission inspection, complaints and enforcement);
• Outcome based key service indicators;
• Management information - for example quarterly or annual reporting.

Monitoring and service review may also have thematic basis, for example in relation to: strategic relevance; service delivery and quality; organisational capacity; and value for money. ⁷²

Frequency of monitoring and review as well as the level of information and other monitoring activity required should reflect the level of funding and scale of service. For example, spot contracts may be managed through individual case reviews where a Council is only funding a relatively small number of people within a service, with case reviews seen to have a contract monitoring function.

Monitoring arrangements should be detailed clearly in the contract, stating the nature and timing of monitoring activity. Local authorities may wish to use a risk assessment matrix to determine how often a service will be reviewed, noting however that monitoring activity may increase if issues arise requiring more intense monitoring, such as after a complaint about the service . This should help determine the periods for management information, such as quarterly or annually. Councils may want to consult on and agree to use a risk assessment matrix to determine how often a service will be reviewed. Councils should also consider whether a review should be triggered by particular events, such as a change of leading personnel in the service provider.

Councils should, for all significant contracts, have a designated member of staff ("contract management officer") with formal responsibility for day to day management of the contract.

Stage 2 - Contract Monitoring, Service Review and Reporting

Contract Monitoring

The purpose of contract monitoring and review is to monitor the quality and effectiveness of the service by reviewing past performance and improvements made by the provider against the contract. It can also inform decisions about contract extension or renewal.

The method employed by a Local Authority for contract monitoring and service review should reflect the Council's social care procurement policy, and include consultation with service users, carers and service providers. It should also include consideration of:

• the views of service users and carers through individual meetings, questionnaires and focus groups;
• written returns/self-assessment by providers;
• providers' performance reviews;
• planned visits to the service;
• unannounced spot checks by the Council and/or provider;
• information from the Council's assessment and care management staff;
• service user records;
• individual service reviews;
• meetings with the providers;
• review of compliments, complaints and serious incidents;
• regulatory information, including Care Commission reports.

Contract monitoring and review should be proportionate and should take account of work by the regulatory bodies. It is important that all of those concerned including service users, carers and service providers understand the different functions of regulation and contract monitoring and also how they fit together. Potential duplication with between a Council and the Care Commission can be addressed through the formal Memorandum of Understanding and regular meetings between local authorities and the Care Commission at which information about monitoring arrangements is shared. This should include information on the level of detail and types of information to be collated by the Care Commission and whether it would be useful for contract compliance purposes.

Contracts officers in some areas find it useful to attend the Care Commission's post-inspection feedback sessions with local services. The national care home contract requires providers to inform local authorities about these feedback sessions; it is possible to request this information from the providers of other services. In addition to inspection reports, the Care Commission has information available on complaints and enforcement which should also be taken into account. The Care Commission provides access to its data store for checking information.

It is essential that service users and carers are actively involved in providing feedback about the quality and effectiveness of the service to secure the desired outcomes. There are a number of methods to involve service users and carers including;

• feedback from service users and carers (via focus groups and use of questionnaires);
• individual case reviews;
• examination of care plans and other records relating to service user outcomes;
• individual visits and interviews;
• peer interviews of service users by service users;
• strategic reviews of services;
• consideration of service users as lay assessors.

Local authorities should consider what scope they have for employing groups of service users to carry out aspects of service review. Peer inspection can help the individuals who use the service under inspection identify and voice concerns that might otherwise be unheard. It can also help to assess the differing weights of negative and positive comments about services.

Councils and service providers may want to use formats which have been established for particular groups or services, such as the Scottish Recovery Indicator model, which helps mental health service providers to evaluate their service in a recovery focussed way and which relies to a large extent on service user input.

The issue of service user and carer involvement in this part of the procurement process will become increasingly important with the development of self-directed support. This extends to the increased use of personal assistants which will require the development of stronger links with care management staff and the use of individual case reviews for robust monitoring.

Financial Monitoring and Review

As part of contract management, local authorities should satisfy themselves that service providers remain financially viable and therefore able to deliver the services they are contracted to deliver.

Service Reviews

Service reviews for individual services should consider the quality of service delivery and any shortfalls in service delivery against the service specification and contract, and any other issues arising from contract monitoring.

It is important to emphasise that this process should focus on service improvement and should build on the partnership working established between local authorities and service providers; it should also involve service users and carers. Service reviews also have an important function in relation to decisions about continuity of service provision.

Service reviews, carried out at predetermined intervals, should also consider the responsiveness of service activity in relation to current demand and potential future need. As part of the service review it is important to consider whether service provision addresses and fits with the strategic direction of the Council and its partners, and whether it is in line with relevant commissioning strategy and corporate plans.

Price adjustments

If a services contract includes a price adjustment clause, it will be appropriate during service review to determine if an adjustment should be made.

Identifying and implementing improvements

As part of the service review process the local authority should record changes required in provider procedure or practice in direct work with service users and carers. It should also note any changes required in local authority procedures and practice.

If significant changes to the service are required, then the local authority, with the provider, should evaluate the provider's ability and willingness to make the changes. The local authority should work with the provider to document its assessment and agree the action required.

If it is not possible to reach agreement on improvements in quality standards and performance to provide good outcomes and meet service specifications, the local authority may consider terminating the contract and seeking a change of service provider.

Other than in situations in which the Care Commission cancels registration or a service provider is seeking to close its service, the decision about whether to terminate a contract should be informed by a benefits and risk assessment which reaches conclusions about a number of questions:

• What will the impact of the changes be on current service users?
• Are there likely to be satisfactory alternative providers?
• What will the impact of the changes be on linked services?
• What will the impact of the changes be for any publicly funded capital assets employed in the service?
• What will be the impact of the changes on the viability of the current service provider?
• Will new capital funds be required and available?
• Will new revenue funding be required and available?

It is imperative that all stages of the review process have been followed, that all relevant factors have been considered and that the reasons for the decision have been documented.

Action Planning

Any improvement proposals which results from the service review should be set out in an action plan this should identify who is responsible for completing tasks and time scales in relation to the range of tasks to be carried out. The decisions about whether it is planned to maintain existing arrangements, or to make small or a major changes will determine the level of information to be given to service users and carers.

If the decision is that there will require to be major service changes, or potentially a change of service provider, then the local authority will need to inform the service provider about this and finalise an action plan for the service, which should include:

• Notifying and involving service users, carers and advocates and potential service users of the service about the changes;
• Making any necessary arrangements when the changes will affect people's accommodation;
• Providing information to service users, carers and advocates about any legal rights, including with respect to accommodation;
• Notifying staff of the proposed changes;
• Liaison with other relevant stakeholders, including statutory bodies, and other organisations who will be affected;
• Establishing a communications strategy, to include press, service users, members and other stakeholders.

If the decision is made to seek an alternative provider or put the service out to competition there must be a clear, agreed process stating how the decision to change providers, through re-tendering or other means, has been made and who has been involved in the process. The decision should be ratified either by elected members or a senior officer designated by the local authority.

If there may be a change of provider, the local authority should continue to work with the existing provider to minimise the impact on service users and other stakeholders. Service users and carers should receive: an explanation of the reasons for the change or closure of the service; an outline of the process and time scale of the process; and the name of a contact person for further information. Service users and carers should also be given information within the context of self-directed support about how to make choices, including information about direct payments and how to use them to secure a continuation of their existing service or an alternative service. They should also be given information about how to pursue these options and offered assistance, including from support organisations, if they decide to do so.

Reporting

Effective control of service provision requires systematic and regular monitoring of service performance to be presented through the line management accountability structure and governance arrangements of the local authority. Reports from contract management officers are the main means of bringing the findings of contract monitoring and service review to the attention of senior managers, elected or board members, and other stakeholders.

The Council policy for social care procurement should set out lines of accountability and governance, and should establish arrangements for dealing with issues of commercial confidentiality. Consideration should be given to special arrangements such as establishing a Procurement Board within the Council.

Council policies should identify certain standards for the work of contract management officers, including that they will be expected to:

• prepare and issue the monitoring findings and evaluation reports promptly;
• consider the consistency of their reported conclusions with those arising from the work of other regulatory and scrutiny bodies;
• consult service providers on the factual accuracy of all draft monitoring reports;
• communicate regularly with service providers and ensure that emerging findings are discussed at an appropriate level within their organisations.

Contract management officers' reports should be written in such a way that service providers, service users and carers understand:

• the nature and scope of the work undertaken;
• matters of substance or significant issues arising from the work;
• the conclusions and judgements that have been reached;
• the nature and grounds for any concerns, and the action that may be required to secure improvement.

The reports, with the findings of contract monitoring and service review, should be:

• Clear, succinct, relevant and written in plain language that avoids, wherever possible, the use of jargon and technical terms;
• supported by the evidence and analysis carried out by the contracts and finance officers;
• explicit when drawing conclusions and making recommendations;

which should be:

• useful, practical and based on an assessment of improvements in outcomes for service users and carers and the likely costs and benefits to the service provider;
• specific about the action that the service provider should consider taking.

Monitoring and Service Review reports should include an action plan which has been agreed between the Council and the service provider and which should reflect the service provider's response to Council's evaluation, and the service provider's improvement plan, with target dates for implementing change and identifying the staff responsible for implementing improvements.

Stage 3 - Implementation

Once plans and priorities for action have been set during contract monitoring activity, in response to a complaint, or as part of the service review, it is important to develop systems through the continued contract monitoring for gathering information about the delivery of actions and improvements. Local authorities and service providers should consider ways in which service improvement can be incentivised. Incentives can be provided through recognition of good outcomes for service users and carers, good reputation and positive reviews. Local authorities should ensure that the contract contains appropriate mechanisms for dealing with poor performance. There are issues about the effectiveness of performance bonds as a means of penalising poor performance, and Councils considering their use should be aware of the difficulties experienced by service providers in setting aside funds for this purpose.

11.5 Use of service provider forums

Service provider forums can be useful in providing local authorities and service providers with the opportunity to discuss general issues in relation to the delivery of services and elements of the procurement process including contract monitoring and review. Provider forums should be promoted as part of supplier development arrangements, and may work most effectively if arranged around service development areas or care groups.

11.6 Link with Commissioning Strategies

Social care procurement involves a circular process in which service development should reflect care group commissioning strategies, which in turn should be influenced by the experience of procurement and the outcome evaluation emerging from a range of sources, including contract monitoring and service review.

Local authorities and service providers need to engage together, along with service users, carers and others, in considering the broad direction for the future of services and in establishing specific plans for meeting social care and other needs. The review process can offer a means to assist gathering together the views of both individual service users and carers, and the experience of broad service provision, to inform the future development of commissioning strategies.