EXCEPTION TO COMPETITIVE TENDERING REPORT RE: PURCHASE OF RESIDENTIAL AND INDEPENDENT FOSTER AGENCY (IFA) PLACEMENTS FOR CHILDREN LOOKED AFTER 1. BACKGROUND There are an average of 120 children and young people looked after by the Borough of Poole. The majority of children looked after are placed with in-house foster carers. The Borough has no inhouse residential facility. For a small number of children, their circumstances require the Borough to purchase specialist residential placement, or IFA placements. The details and reasons for seeking exception to competitive tendering are set out below. 2. RESIDENTIAL PLACEMENTS i) Children and Families Units ‘spot purchases’ specialist residential care placements from voluntary and independent sector providers for a small number of children and young people with very complex and specialist needs. Placements are usually made to address medium/long term needs that cannot be met through local community based service provision, or in house foster placements. ii) On average there are 4 – 5 young people in such placements at any one time. Placements cost on average £3,500 per week. The resulting annual financial commitment per placement can be in the region of £150,000, far in excess of the current limits beyond which competitive tenders would normally be sought. The total cost of residential placements in 2005/6 was £1.122m iii) Potential residential placement providers for the Borough of Poole are identified through A detailed national Purchaser Directory published by Community Care The South West Authorities Provider (SWAP) database. Poole C & F pay an annual subscription towards management of the database Provider information held within C & F Unit from previously used residential providers iv) The process for agreeing and commissioning a residential placement is as follows: v) Multi-agency assessment identifies the need for external residential provision Referral to and case discussion at Multi-agency complex needs panel. Panels role is to ensure that local community based provision has been fully explored, ensure that effective joint commissioning of placements is undertaken and provide quality assurance to residential placements Approval to seek external residential placement given by Service Unit Head. Placement search undertaken by placement service dedicated officer. Shortlist drawn up, matching process quality assurance checks on placement and value for money considerations undertaken. Final approval for placement given by Service Unit Head. Where joint funding criteria are met referral made to Joint Commissioning Panel for funding. Formal contract, service specification and individual placement agreement signed. The Standard SW Regional Commissioning Forum contract is used for all placements. Reasons for requesting exception to competitive tendering: The circumstances and nature of each placement are unique to the assessed needs of the individual child and consequently it is inappropriate to publicly invite tenders for the provision of their individual care. In addition the timescales involved in requiring to purchase a residential placement can be very short – typically as a consequence of the breakdown of a previous placement. The small volume and specialist nature of placements required mean that a block contract, if not financially viable and would not represent value for money. The low level requirement for residential placements means that there would be no interest, or market advantage for the provider, in an individual preferred provider arrangement specifically with the Borough of Poole. C & F Unit have worked collectively, therefore, as part of the SW Regional Commissioning Forum to develop a provider database. In the next phase of development of the database, providers will be ‘allocated’ to participating SW local authorities who will lead on annual contract monitoring. This will include negotiation on annual fee increase in order to avoid excessive price increases. 3. INDEPENDENT FOSTERING AGENCY (IFA) PLACEMENTS i) Children and Families Unit spot purchase IFA placements normally for one of two reasons: Temporary lack of general capacity in the Borough’s inhouse fostering service, or In response to a specialist fostering need (eg., care of a child with a complex disability) where the specialist skills required are not available in-house. ii) IFA placement typically cost between £800 - £1,200 per child, per week. On average Poole has between 6 and 12 IFA placements at any given time with a steady turnover of short term placements during the course of a year. The majority of placements less than 3 months in duration, however, a small number are commissioned specifically for children looked after on a long term basis in order to meet a specific need eg (disability, or appropriate ethnic match). iii) Currently providers are identified through a National Purchasing Directory and through information held by the Unit on previous IFA placements. The process for commissioning and approval of IFA placements is as follows:- iv) Assessment and matching report identifies the need for IFA placement Search of known provider undertaken by Placement Service designated officer. Matching considerations and quality assurance checks undertaken. Approval for placement given by SUH Contract negotiation and agreement undertaken by Contracts Officer. Standard SW Regional Commissioning Forum Contract, Service Specification and Placement Agreement completed. Reasons for seeking exception to tender. Exception to tendering is sought for the same reasons as residential care providers ie., i) The circumstances and assessed needs of the individual child make it inappropriate to tender publicly for provision of individual case placement . ii) The requirement to purchase IFA within a very short timescale due to emergency situations and placement breakdowns 4. IFA PROVISION – BLOCK PURCHASING AND PREFERRED PROVIDER STATUS For generic IFA placements (i.e., to address capacity issues within our in-house service) there are cost advantages to be gained over the spot purchased rates by either seeking a competitive tender from one, or more IFA’s for the supply of a specified number of foster care placements, or by offering a preferred provider status to one, or more IFA’s for an unspecified number of placements. The disadvantage of a block contract tender is the risk of committing fundings to IFA beds that may be vacant as the requirement for placements fluctuates over the course of a year. This can be mitigated by seeking a low minimum placement number – but this in turn will reduce the attractiveness of the contract with a neighbouring authority – which would provide an opportunity to offset vacancies between each other as and when they occur, but also greatly increases the complexity of the contract management task and associated costs. A potentially attractive alternative to a block contract would be the offering (via tender) of preferred provider status (PPS) to one, ore more IFA’s. Although the discount rates that this would attract will be below those attached to a block contract, PPS offers much greater flexibility in respect of placement matching and eliminates the vacancy issue by not committing us to a specified number of placements. The proposed course of action, therefore in order to ensure both a fair and robust access to IFA provider services and value for money is a two stage one. i) Invite any interested IFA provider to become part of an approved provider list for the Borough of Poole. ii) Invited interested IFA providers to apply for preferred provider status with the Borough of Poole. The unit Contract officer will lead on the above process within order to establish both an approved provider list and preferred provider status for IFA’s during 2007. Gerry Moore Head of Children and Families Service