To advise public bodies involved in the commissioning and procurement of social care services of the action they can take now to prepare for the transition toward a National Care Service for Scotland (NCS).
Commissioning and procurement decisions being taken now can support the transition towards a National Care Service for Scotland. Public bodies should therefore:
review current Strategic Commissioning Plans to identify opportunities for alignment with ethical commissioning and procurement principles, see annex A
consider the impact of decisions on resources and the social care market to enable our collective focus on implementation and consider the use of contract extensions or modifications where feasible
maximise opportunities in new procurement decisions to introduce ethical procurement principles and use the flexibility of the Light Touch Regime
The Scottish Government have committed to implementing the recommendations of the Independent Review of Adult Social Care (IRASC). We are working to introduce new legislation in the Scottish Parliament in summer 2022 and intend to establish a NCS by the end of the Parliamentary term.
These proposed reforms have the potential to be the biggest public sector reform in Scotland for decades. They will affect the way we plan, commission, procure and deliver social care support and services. Steps can be taken now as we start the transition to new ways of working.
A public consultation, which ran from 9 August to 2 November 2021 included proposals to change responsibilities for the commissioning and procurement of social care services. Further engagement will take place to help understand barriers and opportunities to support the transition to a NCS and any tools / guidance that may be helpful going forward.
Commissioning and procurement decisions being taken now impact on
people who use services
providers’ ability to respond to ethical commissioning and procurement requirements
public bodies’ ability to fully engage in the new and changing responsibilities for a NCS, for example by over committing resources on legacy projects
The IRASC included a recommendation to explore pressing pause on the current procurement system to support a move from competition based on task and price, to collaboration focused on person centred, quality and outcomes. To enable procurement to support that shift, public bodies need to take action now to begin this journey.
Strategic commissioning plans
Strategic Plans should be reviewed to ensure that there would be nothing which would inhibit a new National Care Service operating in line with ethical commissioning and procurement principles, see Annex A – ethical commissioning and procurement.
Procurement pipelines, forward plans and market engagement
Pipelines and plans should be reviewed, updated and communicated to affected providers to alert them to the shift in commissioning and procurement approach. Portfolio and procurement strategies should signal the importance of transparency and ongoing dialogue to be clear that change may affect the long term delivery of services and contracts. Providers should be made aware of the IRASC report and recommendations and the proposals for commissioning, which were set out in the public consultation for a National Care Service.
Use of existing contracts
Existing Framework Agreements (FA) and Dynamic Purchasing Systems (DPS) are an effective and accessible mechanism for arranging service provision. Owners should consider options to maximise their use. This could include, extending their term and making modifications now to reflect the ethical commissioning principles, including as a minimum fair work practices and cost transparency.
A contract established under the Public Contracts (Scotland) Regulations 2015 can be modified when certain grounds exist. Details of these grounds are summarised in Annex B – modification of higher value contracts.
In all circumstances, where a contract modification is made, public bodies should keep a written justification, which demonstrates the basis for the decision to modify the contract.
New procurement requirements
Procurement teams should engage with providers and people using services to determine whether new procurements are required.
Consideration should be given to whether making full use of existing FAs / DPSs for ongoing call-off arrangements would fit with the ethical principles for a NCS. It may also be possible to extend or modify an existing contract in the interim, in order to provide the services or support needed, in this way, for the short to medium term.
It is important to balance the need for new services or support with the risk of overcommitting budgets, resources and the market in the short term. Interim measures such as shorter term contracts could be considered, in order to avoid over committing providers and to support market readiness to engage and support the mobilisation of the market to introduce a NCS.
Where a new procurement process is required, the procurement strategy should be based on ethical commissioning and procurement principles. This should be done in order to improve services for the benefit of service users and to embrace the principles of ethical commissioning and procurement as set out in the NCS consultation, see annex A – ethical commissioning and procurement principles. This will ensure that all required social care procurement includes: ethical procurement, fair work practices, cost transparency and user involvement in decision making.
Contact terms and break clauses
In all cases, it is advisable to consider establishing contract terms with multiple options for extension and to include break clauses as standard to enable termination of the contract should policies change during the life of the contract. For example, novation or assignation clauses can facilitate a change in buyer or provider, to enable a third party, to take up the rights and obligations of the original contract.
The National Care Service will consider what services are purchased and how they are delivered. Buyers should consider how they might seek to amend contracts in the light of new advice and guidance. Including statements in Invitations to Tender and contracts to the effect that the contracting authority reserves the right to seek changes to the services, in order to align with the NCS will help facilitate such changes.
Buyers should consider the commercial impact of change, novation and break clauses. Such clauses introduce risk to providers that they will have to consider when developing terms and prices for public contracts. The more collaborative and consultative the process for terminating a contract early, or for novating it to a third party, the less risk a provider is likely to perceive.
Support and guidance available
Statutory and Best Practice Guidance on the procurement of health or social care services is available, and is incorporated into the Procurement Journey, which includes details the flexibilities available when using the ‘light-touch’ regime Procurement Reform (Scotland) Act 2014 (the Act): statutory guidance - updated June 2021 - gov.scot (www.gov.scot) / Procurement of care and support services: best practice guidance - updated June 2021 - gov.scot (www.gov.scot).
We would ask that you advise the Scottish Government of any new procurement processes, or contract extensions, which are unable to be aligned with the ethical commissioning principles.
Integration Joint Boards and public bodies are asked to review their Strategic Commissioning plans, portfolio of social care contracts and pending procurement process and take action now to support a transition to a National Care Service.
Please bring this policy note to the attention of all relevant staff, including those agencies, non-departmental public bodies and other sponsored public bodies within your area of responsibility.
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