Opportunities and Risks:
Practice Models for
Commissioning Foster Care
Dr Clive Sellick
University of East Anglia,
Norwich
Practice Models
• Spot Purchasing
– the purchasing of placements and related
services, often without planning, and at
short notice including emergencies
• Outsourcing
– the transfer from public authorities of
responsibility for all or most of their foster
care provision to non governmental
agencies both private and voluntary
• ‘Relational’ Contracting
– agreements between LA and IFP to
purchase and provide fostering services
Spot Purchasing 1
1.
2.
3.
does not allow IFPs to estimate likely
demand or local authorities to predict cost.
It effectively prohibits both the local authority
commissioners and the independent
providers from planning or matching their
respective needs and services.
this method takes little account of the
individual needs of children or the particular
strengths of their prospective foster carers.
Spot Purchasing 2
• ‘the use of spot purchasing as a
major distributive mechanism
merely reflects the fact that
children are slotted in wherever
there is a vacancy with little
opportunity for matching or choice’
• Petrie, S and Wilson, K (1999) Towards the
disintegration of child welfare services. Social Policy
and Administration 33, 2, 181-196.
Outsourcing 1
• Public sector agency
commissioners from central and
local government and private and
voluntary sector providers each
know the type, volume and cost of
services to be purchased and
provided.
Outsourcing 2
• encourages the establishment of a
few, large agencies which
successfully manipulate and
monopolise the market and,
related to this, the range and
diversity of services are reduced
International Research 1
• A study of the impact of outsourcing out
of home care, including fostering
placements for children and young
people in the state of South Australia
•
•
Barber, J (2002) Competitive Tendering and Out-of-Home
Care for Children: The South Australian Experience. Children
and Youth Services Review 24, 3, pp 159-174.
Barber, J and Delfabbro, P (2004) Children in Foster Care
Routledge London
Two major consequences
1. The establishment and
supremacy of a few provider
agencies, often large, which
monopolised the market and
drove out smaller welfare
agencies
Effect = undermined a strength of
the NGO sector by reducing the
range and diversity of services
Consequence 2
• 2. Tight and competitive
contractual arrangements imposed
by public authorities discouraged
NGOs from pioneering new
developments and innovations
Effect = “reduced the nongovernmental sector to agents of
the state” (Barber and Delfabbro, 2004:57)
International Research 2
• Evaluations of the impact of
outsourcing child welfare, including
fostering services, in the State of
Kansas.
– McCarthy-Snyder, N and Allen, M (2003) Managing the uneasy
partnership between government and nonprofits: lessons from the
Kansas child welfare privatization initiative. Presentation at the
25th Annual Research Conference of the Association for Public
Policy Analysis and Management. Washington DC 6 November
2003.
– Unruh, J and Hodgkin, D (2004) The role of contract design in
privatization of child welfare services: the Kansas experience.
Children and Youth Services Review 26, 771-783.
Two consequences
1. “once contracts are let, the
supplier becomes a monopolist
for a long enough period of
time that other nonprofits can
be eliminated from effectively
competing for future bids”
2. “in most areas the services
delivered are less, not more,
diverse” (McCarthy-Snyder & Allen,
2003:28)
UK experience
• ‘while the larger agencies within the sector,
such as Barnardos and NCH, have the
strength, financial power and wisdom to retain
adequate space for innovative projects,
smaller agencies are becoming increasingly
preoccupied with meeting their contract
specifications, with little room for manoeuvre.
For these agencies, the barriers to entry into
the welfare market have been removed, but
the option of exit from the market has also
been removed from their control. The result
may be stifled growth and lack of innovation.’
(Giltinan, D,2002:55, Child care at the end of the millennium, in M. Hill
(ed) Shaping Childcare Practice in Scotland, London, BAAF.).
The status of IFPs
2001, 80% of IFPs registered as
voluntary, not for profit agencies
2006, 253 agencies were
registered as IFPs in England:
33 were ‘old’ IFPs, 28 of these
had registered as voluntary, not
for profit, organisations. 220
were ‘new’ IFPs and of these
206 were registered as private,
for profit, organisations
The Foster Care Market
• There is now a substantial
internal market of private
sector fostering agencies in
England competing with one
another for local authority
placement contracts.
PriceWaterhouseCoopers (2006:25)
‘Children’s Homes and Fostering’
• ‘The largest IFA players are FCA,
NFA, SWIIS and Pathway Care,
but --- there are many small local
providers. Voluntary providers
also form part of this market place,
although there are fewer voluntary
players registered’
Relational Contracting
Arrangements
• ‘The establishment of small networks of local authorities
and IFPs was commonly seen as the most effective
framework for commissioning from the respondents in
this study. Although mostly regional, these networks
might include some more distant IFPs where local
authorities required long-term or very specialist
placements. Such networks of agencies allow local
authorities and IFPs to contract with two or three partner
agencies. This would go some way to avoiding the risks
of monopolies identified in the American and Australian
studies. Within each network, commissioned services
would be identified and planned and include the full
range of fostering placements according to local need’
(Sellick, C, 2006, Opportunities and risks: models of good practice in commissioning foster
care. British Journal of Social Work, Volume 36, Number, 8 pp 1345-1359)
Internal Commissioning
‘All of the case study authorities use
in-house services as first choice’
(PWC, 2006:47)
• Recommends (p.56):
– Institutional separation of
commissioning and in-house
provision
– Separation of owner and provider
functions for in-house provision
The Future:
Mutualism
• The flowers of fig trees are
pollinated by small black wasps
whose larvae feeds on the fruit:
‘without the wasps, the figs could
not reproduce, and so would die
out, and without the figs, the
wasps could neither reproduce nor
feed’ (p. 331).
or Monopolies?
• Are some agencies becoming a
kind of ivy on the face of fostering
or a leylandi ‘which grows so fast
and casts the shadow that causes
so much suburban strife?’
– Tudge, C, (2005:107)The secret life
of trees.
Certainties
• Fostering is no longer an almost
exclusively public sector activity
• The mixed economy of foster care
provision is driven by a political
and professional consensus
• NGO sector is characterised by
private IFPs including a few very
large agencies
Uncertainties
• Will internal commissioning remain
the first resort of LAs?
• As external commissioning
expands at what point might this
become outsourcing?
• Will regional commissioning
regulate the market in terms of eg
maximum size and minimum
numbers of IFPs?