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1 ANNEX 1 to REPORT TWO Achieving for Children Strategic Benefits Realisation and Implementation Route-map January 2014
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ANNEX 1 to REPORT TWO
Achieving for Children
Strategic Benefits Realisation and
Implementation Route-map
January 2014
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Benefits realisation and implementation route-map for AfC This document covers the following:
What Benefits AfC will deliver, including costs, risks and issues
• Section 1 - The summary case for change
• Section 2 - Financial governance, budgets, benefits and risks
• Section 3 - How AfC will work to deliver operational benefits
The Implementation Route-map
• Section 4 - The HR/OD route-map for the new company including through consultation, TUPE,
terms and conditions of service and pension issues;
• Section 5 - The statutory and legal framework within which AfC will deliver services for the
Councils
Managing benefits delivery of AfC
• Section 6 - The governance framework including for commissioning and ownership;
• Section 7 - How the Councils will commission AfC
• Section 8 - The Councils ownership arrangements
Transition management for AfC delivery
• Section 9 – Key activities and member decisions
• Section 10 - Risk and issue management approach and key programme risks
Enclosures (The text below which was in the original Richmond Cabinet report has been amended to reflect the contents of the RBK report and agenda format)
Enclosure 1 – Detailed scope of services (attached)
Appendix 2 – Draft ICT Strategy (NOT YET FINALISED FOR PUBLICATION)
Appendix 3 – Commissioning Intentions – now ANNEX 2 TO REPORT 2/ APPENDIX B
Appendix 4 – Draft Contract – now ANNEX 4 to REPORT 2/ APPENDIX B
Appendix 5 – Draft Specification – now ANNEX 3 to REPORT 2/ APPENDIX B
Enclosure 2 – Draft proposals for contract management (attached)
Enclosure 3 – Draft Performance Management Framework (attached)
Appendix 8 – Draft Equalities Impact Assessment – now ANNEX 3 to REPORT 1/APPENDIX A
Appendix 9 – Draft Articles of Association – now ANNEX 2 to REPORT 1/APPENDIX A
Appendix 10 – Risk Register NOT ATTACHED
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1 THE CASE FOR CHANGE Key features
• Circa 620 FTE staff will work within Achieving for Children, with a budget of circa £115m
• They will be working with schools supporting 46,100 pupils
• Supporting circa 215 looked after children
• Acting as an adoption agency
• Providing Childrens’ centres and youth service etc.
Key points
• Achieving for Children provides the best option for the Councils to secure quality, provide
resilience and save money while maintaining strong accountability for results
• There are clear benefits to be realised from the creation of a Community Interest Company
• The legal and statutory framework to launch Achieving for Children is robust
• The approach to HR consultation and staff consultation is well developed and being
implemented
• Governance structures are appropriate and efficient
• The commissioning process is thorough and efficient
• The ownership arrangements provide an appropriate balance between Council control and
freedom to innovate.
1.1 Introduction
Achieving for Children will deliver more for less. We have already made considerable savings through
our respective efficiency programmes. The challenges of service demand and reductions in resource
mean that all of local government needs to achieve more fundamental change in the way services are
provided. Each of our organisations are approaching this in a way which best meets the particular
circumstances of our Councils and residents, but we share a common vision of continually looking to
raise the quality of the services we offer, particularly to the most vulnerable in our communities. With
Achieving for Children, we have the opportunity not only to develop and embed a new model of
service delivery which will both benefit our children and young people and offer financial benefits but
also to develop as a centre of best practice which will help to improve children’s services across the
sector. We are uniquely placed to do so, having worked hard already on our joint working
arrangements including a joint Director of Children’s services. The AfC company model will take the
level of transformation into new territory.
We consider that the scale of our ambition, its potential to transform services beyond our boundaries,
and its viability as a model of best practice for other authorities, merit the commitment that both
Councils are making to the delivery of Achieving for Children.
The case for an integrated Children’s Service can be summarised into three main elements. An
integrated Children’s Service:
• Is the best way for the Councils to secure quality outcomes for their residents against a
challenging financial outlook.
• Has greater resilience than either Borough would achieve on a stand alone basis;
• Meets a widely held expectation from Government and from people generally that Councils
should work together to reduce costs.
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This latter expectation is supported by growing evidence that sharing services will reduce
management costs and create economies through service redesign; see section 2 for more details.
The initial idea to join the Children’s Services of Richmond and Kingston originated in late 2010 and
some early exploratory work took place the following year.
Within a national policy environment for greater diversity of service provision, devolution from
government and reducing local government finance, the idea of setting up a jointly owned social
enterprise began to take shape.
In June 2011 exploratory work began on setting up an arms-length organisation to deliver Children’s
Services in line with the South London Memorandum of Co Operation.
Following the outcomes of the Ofsted inspection of Kingston in May 2012 the Councils took the
decision to jointly appoint the Director of Children’s Services from Richmond and set up an integrated
management team operating across both Councils from January 2013.
1.2 BACKGROUND AND ORGANISATIONAL CONTEXT
In taking forward Achieving For Children Kingston and Richmond are drawing on their shared vision of
working together to deliver the best outcomes for residents at lowest cost through the development of
new service delivery models at scale that drive innovation, empower service users through greater
personalisation and accountability, provide capacity and learning for other authorities, and provide
inspiring careers that attract the best from our colleges and universities.
Both councils have a track record of quality, innovation, value for money and delivery of change using
models that range from classic procurement, through outsourcing and joint working, to social
enterprise models. To that end both Councils are lead players in the South London Partnership (SLP)
sub-regional network of councils with Merton, Sutton and Croydon, and both have signed up to the
SLP Memorandum of Cooperation which underpins the development of a shared services approach.
For example, Richmond and Kingston have delivered shared HR and Audit services in partnership
between the two councils and have worked with Merton and Sutton to develop a four Borough Shared
Legal Service. As well as delivering savings, this shared service is invaluable in ensuring one single
source of legal advice as the boroughs develop a number of other shared opportunities in line with the
SLP Memorandum of Cooperation. As this example demonstrates, the authorities in South London are
already delivering on structural mergers to back office and management structures.
Kingston and Richmond are now tackling the tougher issues of merging and transforming front-line
services notwithstanding the greater level of inherent risk in complex service functions.
Through such innovations both councils have delivered and continue to deliver value for money to
residents through front-line service transformations that put the community in the driving seat. Both
authorities are amongst the lowest funded per head in London (around £300 per head compared to a
London average of over £600) and below average spenders per head in London, with service
expenditure per resident averaging around £1,300 by comparison with the Outer London average of
£1,650 and an Inner London average of over £1,950. For both authorities, the key service delivery and
therefore spend programmes are environment, adult social care, and children & young people. Both
authorities are acutely aware of the need to drive financial as well as outcome-focussed service
transformation in these three key service areas, notwithstanding their complexity and therefore greater
levels of risk involved, and to deliver more for less.
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1.3 THE BENEFITS OF “ACHIEVING FOR CHILDREN”
There are several key benefits inherent in establishing Achieving for Children as a separate company
with its own identity rather than simply as an integrated LA directorate
1. Focus on core services
By operating as a separate Council owned Company, Achieving for Children will have greater focus on
the delivery of its core services, rather than existing as part of two larger public bodies with a wider
array of interests and duties.
2. Improved staff engagement, commitment, productivity and recruitment power
Staff should have a greater sense of identification with Achieving for Children as their skills and
qualifications will align directly to the objects of the company. Although staff will not have direct
ownership of the company, there is scope to give them genuine involvement in the governance,
strategic direction and day-to-day operational management of the company in ways not possible in a
much larger public sector organisation.
Giving staff genuine involvement in the running of the organisation, enabling them to feed their
knowledge and experience into service improvement and efficiency, will create a more innovative
environment leading to happier staff, greater productivity, better retention and lower absenteeism.
As it builds its reputation as a ‘centre of excellence’ with its own identity and clear focus on provision
of high quality Children’s Services, Achieving for Children would become an attractive employer for
highly skilled well qualified, committed professionals. This attraction for candidates has already been
proven through the appointment of quality candidates who specifically identified Achieving for Children
as the key reason for applying for the post.
3. Decisions taken closer to the service user
Direct engagement with users can make services more responsive, better suited to changing needs
and better able to harness the energy and enthusiasm of the local community. As staff working directly
with users will be closer to the decision makers in the company structure, it should follow that
decisions are taken more quickly, in response to user needs.
4. Improved sustainability of services
Children’s services are sensitive and high risk if they go wrong, both in terms of outcomes for children
and their families and reputationally for local authorities. Few local authorities would be prepared for
another to be the lead on their behalf and so joining together to establish a Company which will be a
single entity delivering services and jointly owned resolves this difficulty.
Furthermore, even if a shared council service could be established with a lead authority, it would not
provide the same opportunities and would limit the ambition AfC will need to innovate in its design and
delivery of children’s services. The Councils would clearly gain from higher performance and
productivity and users and tax payers would all benefit if Achieving for Children out-performed
conventional public sector delivery. Further, by enabling trading through the new company, additional
external sources of income may be developed to reduce the direct financial cost to the Councils.
The benefits described have been shown to be associated with alternative ownership models and
social enterprise approaches.
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5. Increased innovation
Operating at arms length from the councils as a community interest company will allow AfC to be fleet
of foot in decision-making; responsive in seizing opportunities for children and young people; an equal
in its relationships with partners including in the VCS sector thereby enabling true joining-up of
delivery around the customer through real-time sharing of intelligence and data; and better value for
money for the customer, delivering cost-reduction and eliminating customer frustration by ensuring a
single interface with the child/family across all related services and organisations. As an integrated
service, it will be better able to work across key service areas, especially with adult social care to
manage the difficult transition for a child of 17 as they become an ‘adult’ at age 18.
6. Strong accountability through contractual arrangements
Effective and efficient contractual arrangements have been designed to ensure strong accountability
based on service delivery and outcomes for children and young people
7. A strong legal and statutory framework that enhances focus
The legal framework for the creation, ownership and commissioning of AfC to deliver children’s
services on behalf of the two Councils is understood and firmly established. By creating clear lines of
accountability through the suite of legal documents the Councils and AfC benefit from a clearer focus
on the legal requirements around the delivery of Children’s Services (full details can be seen in
section 5).
The Councils continue in discussions with DFE and the DCLG to obtain Government assistance in
improving the legal framework under which AfC is to operate, in order to open further opportunities for
innovation and efficiency in practice.
8. Financial sustainability through alternative revenue streams
By putting structures in place which allow Achieving for Children to trade, the new company will be
able to leverage spare capacity to pursue alternative revenue streams and to reinvest in its services,
which would not be otherwise open to the Councils. The company will be able to respond more quickly
to user demands for new services and take opportunities to develop its client base.
9. An exemplar for local government.
As well as delivering outcome and financial benefits within the locality, a third and broader area of
benefit will be as a centre of delivery excellence for local government. Working as a partner to DCLG,
and subject to capacity that can be provided from a CLG award, the services of the AfC company will
be made actively available from the start to other authorities and partner bodies. The learning from the
improvement to Kingston’s children’s services, which has been designed into AfC following the
‘inadequate’ Ofsted inspection, will be learning that could be provided on a mentoring basis to other
authorities tacking significant improvement challenges. The learning from Members working across
political parties (Kingston and Richmond are under different political control) and different cultural
approaches to change within each of the two authorities can be used to encourage, via the LGA,
Members in other authorities across the country to understand that the risks of joining up across
councils are manageable and will not detract from political accountability. Further, Kingston and
Richmond operate different governance arrangements (the Committee system and the Executive and
Leader model respectively) which, in the initial stages of development provided some challenges that
have been successfully overcome and, again, could provide a good learning point for others.
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1.4 The financial case
The Councils both have experience of the benefits that can be gained from joining services together to
provide larger, more sustainable units that can be flexible to the demands of different organisations
whilst providing excellent services and achieving a greater level of efficiency than would be possible
as separate organisations. Although there are up-front costs involved, the pay-back period will be less
than one year and thereafter net savings can be expected.
Though the initial changes associated with joining together the senior management of the Children’s
Services the two Councils have saved an estimated £650k over 2012/13 and 2013/14. It is anticipated
from the work done to date that this will rise to between £2m-£3m in 2014/15. In the first phase of
setting up the new organisation this will largely come from efficiencies that can be achieved from the
initial joining together of teams. It is anticipated that in the medium term further efficiencies will be
identified as the teams develop into working as a single unit, single underlying ICT is developed and
the teams begin to develop new/innovative approaches to service provision.
It is also expected that the new organisation will seek, initially within the boundaries of the “teckal
exemption”, to develop external sources of income (see section 5.5. for details).
Further details of the costs and benefits can be found in section 2.
1.5 Benefits summary
Type of benefit
Description Timescale Measure
Service Focus on core services From 2014/15
Contractual Performance Measures
Service Improved staff engagement, commitment, productivity and recruitment power
From 2014/15
Staff surveys, staff turnover
Service Decisions taken closer to the service user From 2014/15
User surveys
Organisational Improved sustainability of services From 2014/15
Service Increased innovation From 2014/15
Accountability Strong accountability through contractual arrangements
From 2014/15
Contract management measures
Accountability A strong legal and statutory framework that enhances focus
From 2014/15
Contractual Performance Measures
Financial Financial sustainability through alternative revenue streams
From 2015/16
Growth in new business
Reputational An exemplar for Local Government From 2015/16
N/A
Financial Annual revenue savings of between £2m-£3m in 2014/15, rising in later years.
From 2014/15
Annual budget
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2 FINANCIAL GOVERNANCE AND BUDGET – THE BENEFITS AND HOW AFC WILL
WORK This section sets out at summary level the results of modeling work that has been undertaken by both
Councils to identify the base case costs and net benefits of moving to a joint children’s service
delivered via Achieving for Children (AfC), including the point at which the up-front costs are paid back
through on-going efficiencies.
Key Points
• The value of the services to be commissioned from AfC, including the staffing resources
transferred to it, will be circa £115m based on the draft staffing structures under development
and the value of services to be commissioned.
• Government projections currently show public sector funding continuing to reduce for a
number of years. Dependent on final funding levels and decisions on Council Tax levels, it is
possible that the Councils will need to find in excess of a further £50m of savings/efficiencies
in the next four years. Children’s services form a significant (around 25%) of the 2 councils’
services. Although the Councils would seek to protect funding for services to the vulnerable,
including children, this could still mean savings in excess of £10m (10% +) being required
from these services over this period. The creation of AfC will enable a higher level of
efficiencies to be achieved and minimize the impact on front line services.
• Within this overall savings figure, it is estimated that some £658k (annually) has already been
delivered in 2012/13 and 2013/14 following the initial joining of the management of the
services.
• It is also estimated that savings in 2014/15 will rise to between £2-3m across the 2 councils.
• One off ICT and implementation costs are estimated at £1.3m, which will be identified as the
set up costs of the new company and will be either met directly by the authorities or will form a
first call on any surpluses generated in the future.
• There will be some additional costs associated with the requirements of a Company structure
such as audit and accounts.
• The set-up costs and additional company costs are outweighed by the estimated savings, with
the break-even period being less than one year.
2.1 Introduction
This section defines the expected financial benefits that will be generated as a result of establishing AfC, and identifies the potential costs that will need to be committed to ensure that the benefits are realised. The focus in this section is on net financial benefits – with non-financial benefits being identified in other sections. This section also sets out how the financial governance arrangements will work including in relation to the management of risks and rewards.
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2.2 The financial background
The medium term prospects for local government finances are very similar to those in the past three years: significant reductions in central government funding, limited scope for increased Council Tax revenues and rising costs and demands for existing services. Both Councils therefore face a significant financial challenge, which existing plans currently address only in part. The commercial case for this proposal rests on three questions:
• Does this proposal increase the prospects of achieving plans already set out by the two Councils?
• Could the proposal lead to a level of efficiency beyond existing plans?
• In the light of answers to the first two questions above, is the additional investment required to deliver the vision set out in this proposal acceptable?
The key financial challenges for the two Councils in the context of national deficit reduction are set out in the respective Medium Term Financial Strategies
2.3 Current Budgets
The elements of existing Council budgets that would transfer into AfC are summarised in the table below:
* Strategic Management for LBR (£700k) includes the AfC Management Team
AFC Divisions LBR £m
RBK £m
Total £m
Social Care
10.6 7.6 18.7
Prevention & Early Help 13.3 12.9 25.7
Education Services 5.1 4.8 9.9
Finance & Resources 1.9 0.6 2.5
Standards & Improvement 1.4 0.4 1.8
Health Integration 0.1 0.1 0.2
Strategic Management 0.7* 0.1 0.8
Pupil Premium passported on 2.8 3.0 5.8
DSG passported on 19.9 16.8 36.7
PFI Contract 2.2 0.0 2.2
In House Support Services 0.0 0.7 0.7
Sub-Total 58.0 47.0 105.0
Property 1.5 2.0 3.5
Support Services 3.6 3.1 6.7
Net AfC 63.1 52.1 115.2
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These figures are based upon the 2013/14 budgets and therefore are provided to give an estimate of the level of the final AfC budgets for 2014/15.
The difference between the two Authorities can be broadly explained by:
• A proportion of each Councils DSG will be passed onto to AfC to fund 2 to 4 year old free nursery places and SEN pupils at independent special schools and other local Authority schools. For each Council, these amounts are different (Richmond receives a higher DSG allocation than Kingston and has higher costs for these areas)
• Richmond has an existing PFI contract and the cost of the annual contract payment has been included.
In addition to the above there are a small number of direct service budgets that will remain with the Councils, reflecting the Councils’ statutory duties (see below), and the Councils will each need to establish new client side arrangements for these services. These client side arrangements are likely to involve some reorganization of existing resources plus the bringing in of a small level of additional specialist advice.
Section 6.3.1 explains the employment and secondment arrangements for staff whose role includes decision making on children’s care. The total number of staff who will be employed directly by the Councils is 28 and the cost of these staff is £1.8 million and is not included in the table of current AfC budgets above. However, it is hoped that the discussions with Government referred to elsewhere will enable the bulk of these to be transferred to the Company.
Work has also been undertaken to review all of the support services provided to AfC. This has been a particularly challenging piece of work as, in a number of areas, the two Councils currently have different approaches to how each is provided i.e. in some cases the services are devolved to the Education and Children’s services, in others they are centralised and in others the “line” between what is centralised and what is not is drawn differently.
The principle that the organisations have been working to is, if established, AfC, and the functions to support it, should not unfairly disadvantage AfC or either Council – “either all parties succeed or none”. Also that the arrangements should seek to promote the lowest overhead cost across all three parties, rather than promoting a situation where one party is able to achieve savings at another’s expense.
A final position has now been reached on all of these areas. In overall terms the provision of the services falls into one of three categories:
• AfC continues to buy support services from the respective Councils and they will be allocated sufficient budget to buy these services at the level agreed (similar to the current arrangements).
• The support service is provided by one Council to AfC and appropriate budget adjustments are made.
• For some it has been determined that it is more appropriate for the services to be an integral part of AfC from the start.
Over time it is expected that the support services may be exposed to competition both by AfC and other Council services but initially this will only happen where there is a clearly beneficial business case for all parties involved. The optimal approach needs to harness the commercial challenges that can be generated from AfC within a managed framework that ensures the net impact on all parties in aggregate is the key driver rather than savings for one area at the expense of another.
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Where the current support service arrangements are changing, in particular where a service that is currently being provided centrally for the whole of one of the Councils is to be devolved or provided solely by one of the Councils, this provides differing challenges to the Councils in ensuring that this change does not increase costs to either them or AfC. These need to be addressed by each Council but the overall aim is that the services are provided at no more or a lower cost (through joining them together) except where the new company arrangements provide additional costs. Particular examples of this latter category are:
• Separate insurance arrangements which are in the process of being procured.
• Separate External Auditing arrangements with a cost of around £20k - £30k per annum
• The need for specialist VAT and Corporation Tax advice. The Councils have taken advice during the development of AfC and it is expected that these advisors will be maintained in the first year of AfC’s operation.
As identified below, the short term benefits of joining the services together more than outweigh these costs and, over time, we expect to be able to drive further reductions in the support costs as new arrangements become more settled.
2.4 How will AfC improve efficiency? The two Councils have already embarked on joint management of their Education and Children’s
services with the formal appointment of a joint Director in December 2012 (although interim
arrangements had been in place for some time before this). This combined with further amalgamation
of the senior management team has already seen the Councils save some £658k since 2013. Further
management restructure savings will be built into the base budget from 2014/15.
Work is now significantly advanced on further joining together of the existing teams as far as is
practical. It is anticipated that that this work will see the efficiencies available from the provision of joint
services rising to between £2m and 3m in total across both Councils in 2014/15. It is likely that there
will be a difference in the exact savings delivered to each Council, as each starts from a different
position and in some instances the services provided to each Council are different. The majority of this
saving will come from a reduction in management at all levels in the joint service with the emphasis on
protecting front line services. Overall staff numbers in the new joint service are anticipated to be lower
than the existing but the exact numbers will not be known until final structures have been developed.
It is clear that both of the Councils will need to continue to seek efficiencies in all of their services as
public sector funding is anticipated to continue reducing in 2015/16 and beyond. The services that AfC
would run will continue to constitute around 25% of the Councils’ net cost base and hence are likely to
need to contribute significantly to these longer term reductions. It is anticipated that the joining
together of the services in the model proposed will provide a larger organisation than would otherwise
have been the case given the future budgetary environment for Local Authorities. A larger and more
stable organization will be able to attract and retain the best staff and provide a responsive and flexible
service to the Councils. Over the short to medium term it is expected that the organisation will
therefore be better placed to meet the financial challenge faced by all public services and develop
innovative services and explore the opportunities for trading to the benefit of both founding Councils.
Government have currently indicated that public sector spend will need to continue to reduce
significantly in 2015/16 and beyond. Depending on the final Government settlement for local
government and levels of council tax increases this could mean both Councils facing savings targets
of £20m-£30m plus in the four years beyond 2014/15. Even with the Councils seeking to protect
services to the vulnerable, including children, AfC will be expected to contribute to the Councils’
overall savings targets.
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It is implicit that AfC recognises Councils’ budget pressures and will continue to seek to deliver
savings through further and deeper integration and new ways of working while improving outcomes for
young people and families and improving opportunities for staff. Specifically:
• Sharing expertise across the two boroughs and beyond as trading opportunities develop
• Critical mass of staffing to improve service resilience and quality with a better balance
between locally focused and specialist knowledge
• Decision making increasingly devolved to front-line staff to improve responsiveness
• Learning from opportunities to work in different LA areas, developing a more flexible
workforce, internal secondment etc.
• Enhancing training/CPD opportunities
• Greater empowerment for staff to innovate and take decisions
• Greater opportunity to invest in staff-led schemes
• Measured expansion to develop new business opportunities and income streams
Integral to this is also the opportunity to operate with more agility, with policies, procedures, decision
making structures and criteria that specifically suit AfC and are designed to empower staff to focus on
outcomes.
2.5 The costs of establishing AfC Establishing a new, innovative approach to providing Education and Children’s services across two
boroughs inevitably involves costs of designing new structures and processes and ensuring the entity
is established in a safe and legal manner. As well as the very significant amount of internal resource,
the councils have brought in external support where required.
The Councils have successfully bid for a Transformation Challenge Award of £500k from the DCLG
and are optimistic of additional resources (professional support) from the Cabinet Office Mutual
Support Programme. A decision on this is expected shortly though the value of the support would be
less than £100k
Set-up costs for AfC are identified as additional resources required for developing and implementing
the project. Existing staff time (which has been mainly at a senior level) has not been separately
costed but where back-fill or additional support has been necessary because of the staff resource
involved with AfC, this has been included. The one exception to this relates to internal legal charges
(from existing staff in the joint service) which are directly charged on a time basis to the project.
The AfC project has been managed by a number of workstreams which have each ‘commissioned’
additional resource to deliver their part of the project and the following table (overleaf) shows the total
estimated set-up costs analysed by workstream:
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Item
To March 2013
£
During 2013/14
£
Total to March 2014
£
Overall Programme
Programme Management 89,017 115,983 205,000
Legal Fees (External Fees) 100,000 100,000
Legal Costs (Shared Service Charges) 70,000 70,000
Sub-Total 89,017 285,983 375,000
AfC Workstream
Additional Programme Support 82,300 95,000 177,300
Payroll System - Implementation 150,000 150,000
Sub-Total 82,300 245,000 327,300
Finance Workstream
Professional Advice:
VAT Consultant 28,300 8,700 37,000
Corporation Tax Consultant 35,000 35,000
Pension Fund - Actuarial Advice 10,000 10,000
Other Costs: Finance System - set up costs and interfaces
etc. 30,000 30,000
Additional Programme Support 12,200 88,800 101,000
Bank Account Procurement 5,000 5,000
Insurance Procurement 7,000 7,000
Sub-Total 40,500 184,500 225,000
Commissioning Workstream
Additional Programme Support 20,000 20,000
Council Impact Workstream
Additional Programme Support 20,000 20,000
ICT Workstream
Additional Programme Support 20,000 20,000
Initial set-up costs 250,000 250,000
Sub-Total 270,000 270,000
TOTAL SET UP COSTS 211,817 1,025,483 1,237,300
Transformation Challenge Award (500,000) (500,000)
TOTAL NET SET UP COSTS 211,817 525,483 737,300
These figures include reasonable estimates of costs up to April 2014 but there are still a number of
uncertainties within the programme. In addition:
a) The separate payroll system for AfC is still at the specification stage and the estimate cost of
£150k is an initial estimate that is subject to change
b) The estimated cost for ICT initial set up costs (£250k to April 2014) is subject to further
detailed study and is only indicative at this stage. These represent only part of the ICT
development costs for AfC, most of which, if approved, would be incurred after March 2014.
c) No overall contingency is included within these estimates and any changes are monitored by
the Joint Officer Board.
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To put these costs in context, they need to be set alongside the broad estimate of the overall size of
the ‘business’ that AfC will be from 1st April 2014. From the figures shown above for the budget, the
total set up costs (before taking account of the Transformation Challenge Award) represent less than 1
% of AfC’s total annual turnover. The total set-up costs net of the £500K from the government are
greatly outweighed by the savings to be delivered.
2.6 Financial Governance The Councils financial governance arrangements in respect of AfC will change to recognise the
different way in which the service will be commissioned and provided. These arrangements form an
integral part of the wider governance and performance management arrangements that are set out
elsewhere in this document. Set out below are some of the key elements of budget setting, budget
monitoring, final accounts and management of risk:
• Financial planning
An integral element in allocating resources to AfC will be forward financial planning. Both
Councils have similar medium term financial planning processes and AfC will take these into
account in their own planning processes. The future direction of resource allocation will need
to be managed through this planning process rather than having annual discussions around
next year’s budget. Government actions often impact on this desired process but it is a
common aspiration of the Councils and AfC.
• Budget setting process
Action When Outcome
1 Council issues initial planning guidance for next year’s budget to AfC
Draft Commissioning budgets issued to AfC
Q1 AfC informed of revised budget and planning guidance for next financial year.
AfC in possession of draft financial control total and therefore required savings etc
2 AfC completes draft budget control totals based on initial guidance and overall business plans (including MTFS)
(These control totals will require sufficient narrative / explanation for the Council to fully understand what they mean.)
Q2 AfC’s spending plans are crystalised at a high level taking into account:
• Previous year’s outcomes
• Agreed Business Plans
• Planning guidance issued by Council
These plans are submitted to the Council
3 Council considers AfC’s budget proposals at control total level and gives preliminary agreement
Q2 Council understands AfC’s spending plans for the next financial year and how they relate to agreed plans and policies.
Council gives preliminary agreement to these plans which enables AfC to start work on detailed budgets (EWP’s) for next financial year.
4 AfC submit draft detailed budget for next financial year (in format required by Council*) to the Council.
Q3 AfC have detailed budget & staffing levels etc. for the next year.
Council have detailed spending plans to review.
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5 Council gives informal agreement to draft AfC budget or requests revision. If revision this has to be agreed by end of December.
Q3 AfC have detailed approval to their budget plans (subject to government financial settlement).
Council derives ‘comfort’ or otherwise from conclusion of detailed budget process into formal contract with AfC. This is a key milestone in judging the financial management abilities of AfC.
6 AfC formally:
• approves its budget for next year
• approves its Business Plans for next (3/4) years including financial plan
• Publishes plans & budget
Q4 AfC complete their budget cycle and have their business and financial plans in place for the next 3/4 years and budget / funding for the next financial year.
AfC publish forward plans and budget in a timely manner.
7 Council approves its budget for AfC funding that feeds into overall budget and CTax requirement.
Q4 Formally closes the Council’s budget setting process for AfC.
Funding levels approved and all financial processes completed to start the next financial year.
* both councils will seek to standardise formats.
• Contract and Performance Management process -
AfC will be held accountable for delivery of outcomes against budget through a robust and
transparent contract management framework. In-year financial monitoring for AfC will be
integrated with performance monitoring through the commissioning governance framework
(see section 7.2) and the contract that the councils will have with AfC. At a detailed level this
will be through monthly meetings with AfC officers which will focus on:
a) Service delivery and performance against targets
b) Financial performance
c) Other contract management issues
Financial monitoring data will be provided by AfC to an agreed format and timescale and will
relate to the risk sharing mechanism, focussing on the demand-led and high risk budget
areas. Service and performance data will be included alongside these financial reports to
provide a clear and transparent understanding of the relationship between service delivery
and spending and the performance of AfC in managing / mitigating risks.
Outputs from these monthly meetings will be reported through the Operational Commissioning
Board to the Children’s Commissioning Board. This will include any escalation of concerns
around budget risk. In addition to regular monthly budget monitoring, reports on financial
performance will be made to the Children's Commissioning Board Group (quarterly) and the
Joint Committee (as required). Outputs from the monthly budget monitoring will also provide
data to each Council to inform their internal financial monitoring.
In accordance with the risk sharing mechanism, AfC may request additional funding (i.e.
additional budget and contract payment) in accordance with the change control mechanism in
the contract for demand-led budgets (and other budgets in exceptional circumstances) and
these will be considered initially by the Joint Commissioning Group. If the proposals are
outside the current budget framework of the Councils then, as with any significant budget
change, formal approval would then be required from Members.
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Separate to the routine in-year financial monitoring, outcomes arising during each year can
impact on the financial planning and budgeting processes (as outlined in the preceding
paragraphs). For example, trends in levels of spending / volumes of service provision and
additions to the contract (via the change control mechanism) will all need to be identified and
factored into each Council’s financial planning processes. Similarly, AfC will have its own
medium term financial plan that will be updated regularly during the year.
FINANCIAL MONITORING/ REPORTING and BUDGET SETTING
Operational Commissioning Board
Children’s Commissioning Board
Joint Committee
Councils –
Scrutiny / Committee / Cabinet
Budget monitoring
Monthly Budget / Service data
üüüü
Quarterly Financial Performance Report
üüüü üüüü
Material Variance Report
(Dependent upon Value) üüüü üüüü
Contract Price Changes (Dependent upon Value)
üüüü üüüü üüüü
Financial Reporting
Financial Outturn üüüü üüüü üüüü
AfC Financial Accounts (and Report)
üüüü
üüüü
Financial Planning / Budget Setting
Initial Financial Planning Guidance to AfC
üüüü üüüü
üüüü
Consideration of AfC Proposals
üüüü üüüü
üüüü
Approval of AfC Budget and contract price
üüüü
üüüü
• Statutory governance
AfC will be subject to a very similar statutory regime as the Councils in relation to its financial management.
Accounts - AfC will be subject to statutory accounting standards which will be similar to the Councils’. As a wholly owned company, AfC’s accounts will need to be incorporated within each Council’s accounts (within Group Accounts) and AfC will be required to meet the Councils’ requirements for their accounts preparation in terms of accounting policies, timing and quality of their accounts, as any issues arising from AfC’s accounts at audit will impact on each Council’s audit reports. This is a material risk to both Councils because the size of AfC in relation to each Council’s accounts could mean that any misstatements in AfC’s accounts would result in a qualification of the Councils’ accounts.
In addition, both Councils have the same external Auditor (Grant Thornton) and they will also be appointed as auditor to AfC. Similarly, AfC will use the shared internal audit and risk management service that the Councils use.
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Tax – AfC will be subject to different VAT and Corporation Tax regimes to the Councils.
Councils are not subject to Corporation Tax but AfC will be potentially liable for Corporation Tax (21% for 2014/15 and 20% thereafter) on any surpluses that it makes. Professional tax advice has been taken and based on the current plans the risk of a corporation tax liability arising in the short – medium term (3 to 4 years) is not regarded at this time as significant. Any additional business that AfC attracts from other entities would increase the risk of corporation tax being payable on the profit.
VAT – AfC will be treated differently to the Councils in terms of recovering any VAT and will essentially need to recover this through its ‘sales’. Professional advice has been taken and arising from this HMRC has ruled that the proposed arrangements will not incur any additional VAT liability.
Future Tax and VAT – As AfC develops commercially and becomes successful it is likely that its tax position will change and it is very likely that Corporation Tax will be liable on its profits. However, its trading base will have changed and the impact of this on the two Councils will be different. AfC will need to develop its own capacity to manage its future corporation tax planning and ongoing VAT position (with external advice) and this is being recognised the structure of AfC’s finance division.
Teckal – AfC is being structured to benefit from Teckal exemption (so that the Councils can procure services from AfC without the need for application of the EU procurement regime, see section 6.5) and it is important that the rules around the Teckal exemption are complied with. As with the tax issues discussed above, the development of AfC as a commercial business will require continuous review to avoid potential Teckal issues arising, and ensure that appropriate measures can be put in place to avoid any implications for the contract between AfC and the Councils.
Community Interest Company (CIC) – there are issues arising from AfC being registered as a CIC, in particular the application of the ‘asset lock’. In simple terms this means that:
a) Profits made by AfC cannot be distributed to the Councils (e.g. as a dividend)
b) Any assets owned by AfC can only be disposed of at market value and the value retained within the company.
The issues around potential future profits are dealt with in the next section. For other assets, the Councils will be providing assets to AfC on its inception through leases (e.g. operational buildings) and the intention is that any future assets (until AfC has expanded its business materially) will be funded by the Councils as the intention is that AfC will not borrow in its own name but rely on the Councils for its capital requirements. Thus future assets (of any material value) could also be leased to AfC to ensure that there are no detrimental affects from the asset lock.
Group Accounts - AfC’s accounts will be consolidated into each Council’s Statement of Accounts as Group Accounts. Currently neither Council is required to provide Group Accounts alongside its single entity accounts; however, due to the nature of the ownership of AfC by the Councils, Group accounts will be required.
In practical terms, the Council will require AfC to have its accounts produced and audited by 30 May after 31 March financial year end. This will enable the Councils to produce their single entity and group accounts by the statutory deadline of 30 June. It is important that AfC receives its audit opinion and unqualified position by the 30 May so as not to have an effect on either Council’s audit opinion. In other words if the Council has to consolidate unaudited AfC accounts into its group accounts to meet its 30 June statutory deadline, there is a risk that any audit errors or issues subsequently discovered in the AfC accounts will feed through to the audit opinion of both Councils. The risk is the same for a case where auditors issue a qualified opinion on AfC’s accounts.
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The Council’s accounts which will include the group accounts will follow the current process for sign off and approval in both Councils. This process also includes the audit opinion on the Council’s Annual Governance Statement which will require submissions from AfC to provide assurance to the Council’s governance framework.
Sharing of surpluses/deficits and managing high risk budgets
A mechanism is being finalised to manage budget risks and share financial rewards from AfC’s trading with the Councils. The principles underpinning this are:
a) Risks and rewards should be balanced over the longer term
b) Financial rewards should be shared between AfC and the Councils over the longer term.
The relationship between the Councils and AfC will be complex and need to be recognised differently as ‘Owners’ of AfC and as ‘Commissioners’ of services from AfC.
As owners, the Councils will have responsibility for the following risks and rewards:
a) Fund any losses that AfC incurs
b) Decide to provide working capital / development funding
c) Determine the application of surpluses generated by AfC
As commissioners, the Councils will decide on what services they want from AfC and set a budget for AfC framework that includes
a) Medium term plans to indicate priorities and funding
b) Annual budget setting for AfC and annual commissioning plans
c) Monthly contract monitoring of service and financial performance
d) A change control procedure that allows for changes in the specification and budget during the year
e) An annual review mechanism to inform changes to the specification / budget for the following year
Sharing Risks
The proposed mechanism recognises two kinds of budget risk – ordinary service expenditure for which AfC should take the business risk, and demand-led budgets for which it is not appropriate for AfC to bear all the business risk if events outside AfC’s control increase expenditure.
For demand-led budgets a threshold is to be established based on a number of agreed factors (e.g. number of cases) and the degree to which AfC can reasonably be expected to influence each factor. This establishes a mechanism for each financial year where the responsibility for risk is clear. A very simplified example would be that AfC has a budget (will be paid) for 100 cases and will be expected to take the risk of this increasing to 105 cases. Beyond this risk level the Councils are expected to underwrite additional cost by providing additional budget (AfC will be paid more) for the increased expenditure.
The mechanism to transfer risk to the Councils will be through the change control mechanism in the contract whereby each case is looked at on its merits and a variation agreed. This change control mechanism can also be used in exceptional cases to transfer risk relating to ordinary service expenditure to the Councils.
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Sharing Rewards
One of the key issues with a Community Interest Company is that the assets are locked in for the purpose of the company. In these terms the assets of the company include any surplus generated.
The following principles will apply on the application of any surpluses / profits:
a) Profits and losses will be determined at year-end
b) The Councils, as owners, will determine the application of profits (subject to agreement in the reserved powers)
c) Profits from the business relating to the Councils services will be applied in accordance with the CIC requirements and be restricted to the benefit of services within the two Boroughs.
d) Decisions on the application of profits will be made in relation to each year individually and will not prejudice decisions in respect of future years
e) The mechanism for considering and deciding upon the sharing of risk and reward will be reviewed periodically by the two Councils as a function of ownership of AfC.
The proposed mechanism to consider and make decisions on the application of profits and losses is:
a) AfC will report its financial outturn to the Councils at year-end and make recommendations on
i) Proposals for the investment of any profits for the year and
ii) Proposals for remedying any loss. (NOTE: the accounting policies and methodologies used in preparing AfC’s accounts and presenting its profit and loss will be agreed by AfC and the Councils)
b) As part of the discussions around the Councils’ commissioning plans, AfC will share its plans for re-investment of any profits with the Councils. This will inform end of year decisions on the re-investment of profits.
c) In addition to the annual decisions on re-investment of profits, AfC can make application to the Councils for investment in the company and / or services as part if the commissioning and financial planning process. Any investment approved by the Councils may be taken into account in decisions on future years’ profits.
d) To the extent that the Councils agree to any Change Control requests during a financial year, any additional contractual payments:
• Will impact on AfC’s financial position and reduce losses at year-end.
• Will not automatically affect the contract price for future years – the commissioning/financial planning process will determine annual contract prices.
e) In the event that AfC make a loss in the year this will be held in AfC’s accounts and carried forward to be offset by future profits.
The mechanisms for dealing with risk and reward have been developed solely in the context of AfC trading predominantly with the two Councils. Any material increase in AfC’s business with other entities changes the risk / reward relationship between the Councils and AfC and new mechanisms will need to be developed to deal with the circumstances as they arise.
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2.7 Financial benefits summary
Type of benefit
Description Timescale Measure
Financial Annual revenue savings of between £2m-£3m in 2014/15, rising in later years.
From 2014/15
Annual budget
Financial Pay-back period of less than 1 year From 2014/15
Annual budget
Financial Potential for reduced cost of services when AfC begins grows new business
Annual budget
Governance Clarity of accountability and decision making via contractual arrangements
From 2014/15
Key Performance Indicators
Governance Clarity on key delivery requirements From 2014/15
Key Performance Indicators
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3 HOW ACHIEVING FOR CHILDREN WILL
WORK OPERATIONALLY, AND DELIVER BENEFITS
3.1 Overview Achieving for Children (AfC) will be a Community Interest Company Limited by Guarantee, wholly
owned by the Councils and run by a Board of Directors and management team. The full details about
ownership structures can be seen in section 8.
Circa 620 staff will TUPE transfer from the Councils into AfC and they have already been involved in
developing the vision and organisational values of the new joint service.
The Chief Executive of AfC will continue to fulfil the role of Director of Children’s Services (DCS) for
the Councils. To maintain the robust link with the Councils the DCS will remain employed by LBRuT
and be seconded into AfC.
3.2 Scope of services AfC will be commissioned by the Councils to deliver Children’s Services including:
Prevention and early help
• A single point of access for information and advice as well as to raise concerns about children; and targeted support that promotes family wellbeing, ensures good school attendance, prevents crime and anti-social behaviour, and provides for children with special educational needs and disabilities.
Children’s social care
• Providing assessment, interventions and support for children in need and those requiring protection, as well as quality provision for children in care, care leavers, fostering and adoption.
Education services
• Delivering support and challenge for school improvement, planning sufficient school places, managing school admissions, and support to early years’ providers, school governing bodies, free schools and academies.
Health integration
• Ensuring integrated health services for children and young people by working with General Practitioners, public health services and health care providers and the Commissioners of these services
AfC will also manage:
Local Safeguarding Children’s Board (LSCB)
• LSCBs, as established by the Children Act 2004, places a statutory responsibility on each local authority to have this mechanism in place. LSCBs arrange for all relevant partners to meet to agree on how they will cooperate with one another to safeguard and promote the welfare of children. The purpose of this partnership working is to hold each other to account and to ensure safeguarding children remains high on the agenda across their area.
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Children in Care Council (CiCC) and Independent Reviewing Officers (IROs)
• Local authorities, as the corporate parent for children who are looked after, are required to ensure that children have a meaningful involvement in the planning and evaluation of services that cater for their needs. In addition to the CiCC which gives young people in foster care a voice with their corporate parent, AfC also manages the statutory IRO service. This service is best deployed outside of the delivery teams for children’s social care, and makes an important contribution to the goal of significantly improving outcomes for children looked after. The IRO primary focus is to quality assure the care planning process for each child, and to ensure that his/her current wishes and feelings are given full consideration.
The detailed scope of services that AfC will deliver is in Enclosure 1.
3.3 Organisational structure and staffing There are three key features of the organisational design of Achieving for Children
• There is a joint senior management team
• There are separate Directors of Social Care, one for each local authority area
• Teams will be organised into nine localities
Service Design proposals for the joint service started to be developed and implemented for 18 service
areas in April 2013 and this process will continue until Autumn 2014. These detailed service redesign
proposals will inform a bottom-up assessment of resource and supporting infrastructure requirements
and are enabling a detailed financial analysis to be undertaken. Whilst not completed yet, the work to
date has identified that significant benefits can be achieved via the proposed model.
3.3.1 Senior Management Structure
The joint senior management structure has been developed to provide sufficient capacity, expertise
and coverage across the teams and importantly it includes separate Directors of Children’s Social
Care for each Council.
Chief Executive Officer & Director of Children’s Services
Deputy Chief
Executive
Officer &
Director of
Operations
Director of
Children’s
Social Care:
Kingston
Director of
Children’s
Social Care:
Richmond
Director of
Education
Services
Director of
Strategy &
Improvement
Director of
Finance &
Resources
Associate
Director of
Health
Partnerships
Associate
Director of
Early Help
Associate
Director of
SEN &
Disabilities
Figure 3.3.1a – Senior management structure
3.3.2 Locality-based teams
The teams will be organised into 9 localities across the two council areas. The rationale for the structure is to deliver integrated children’s services that are locally accessible and meet the specific needs of local communities. By bringing together professionals into locality-based teams, the organisation will be able to wrap services around the needs of individual children and families to ensure they receive the right services at the right time and prevent concerns escalating to higher cost
and more specialist provision. .
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3.4 ICT Solution
3.4.1 Introduction One of the key challenges in the modernisation and integration of Children’s Services from two
Councils into a single service provider will be the information systems and the ICT infrastructure
provided to staff to enable them to work as effectively as possible to deliver both outcome benefits to
users and efficiency benefits. A draft ICT strategy has been produced in conjunction with the two
Councils and is attached in Appendix 2. The following provides a summary of the key themes
developed within the strategy to date, particularly in relation to the benefits, costs, risks and
implementation:
Service Improvement
• ICT will enable and support service transformation and working efficiently through the following workstreams:
• Providing access to better knowledge and data sharing
• Using technology to expand/create efficient channels for service delivery
• New ways of working
Business Systems
• Business systems will be consolidated around a small core of modular applications from best of breed suppliers
ICT Infrastructure
• AfC will adopt a collaborative approach for ICT infrastructure services. Strategic decisions will be based on an alignment with one or both Councils’ ICT Infrastructure Strategies
• AfC will not ‘own’ any ICT infrastructure but secure delivery on a service basis through a multi-sourced approach
ICT Governance and organisation
• All strategic and associated investment decisions regarding service improvement, business systems and ICT will be made by the AfC Board with a programme of change projects being managed through a Programme Board, coverage of which may sensibly be broader than just ICT and include service transformation in the wider sense.
• AfC will have an Information Services team which commissions ICT services, manages some change projects, oversees information governance and provides some elements of business application support
• ICT activities to support business systems will be provided primarily on a managed service basis, subject to the business case demonstrating value for money
Work is currently underway to design the necessary programmes to deliver the above outcomes, with
a dual focus on service transformation work and the development of costed ICT infrastructure delivery
options from one or both Councils.
The benefits to be delivered from the ICT investment, costs involved, risks and timelines are
summarised at the end of this section.
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3.5 Support functions
3.5.1 Finance Support The finance support for the company will be split between aspects delivered directly by Achieving for Children, and others delivered by the Council’s existing finance infrastructure as follows:
§ Financial system (General Ledger, Accounts Payable and Accounts Receivable): AfC will operate SAP hosted by LBRUT.
§ Financial Accounts production: This will be completed by AfC, with input from the two Councils (who will need to consolidate Achieving for Children finances into the respective Council’s accounts). This includes the processing of accounts receivable and payable.
§ Treasury Management: This will be completed by Achieving for Children.
§ Management accounting and service manager financial support. This will be completed by
Achieving for Children
§ VAT and Tax Advice: AfC will be responsible for the administration and management of VAT
and Corporation Tax and will liaise with the Councils and obtain external professional advice
as required.
§ Government Returns Information: AfC will provide the required information to enable the
Councils to complete and submit government returns.
§ Schools Finance, DSG and Funding Formula: Managed by AfC with schools funding paid
direct by the Councils.
§ Internal Audit: AfC will purchase from the Councils’ Shared Service.
§ External Audit: AfC will be audited by the same auditor as the Councils(Grant Thornton).
3.5.2 Premises For the first two to three years of operation, the company will continue to operate from existing
locations. During this period there will be a review of the location of teams to ensure operational
effectiveness. Beyond this period, the potential for relocation will be explored in order to ensure best
value. All locations will be occupied by Achieving for Children on a serviced office basis with the
respective host Council providing a comprehensive facilities management service.
3.5.3 Human Resources The majority of HR support services will be provided by the Councils HR Shared Service and will
include: Recruitment, People Management Procedures (case management), HR Policies and
Procedures, AfC staff Terms and Conditions and Learning and Development (corporate).
AfC will have a separate iTrent payroll via the shared contract held by the London Borough of Sutton.
The payroll will be administered by Agilisys.
3.5.4 Procurement As a contracting authority, Achieving for Children will require specialist support for its procurement
activities. Initially this will be provided by both Councils, moving to a single Council offering support in
2015/16. Some 140 existing Council contracts will be in scope to be novated to Achieving for Children
including a number of contracts for social care placements.
3.5.5 Legal Achieving for Children will purchase legal advice from the Councils’ Shared Legal Service. Achieving for Children may need to purchase independent legal advice on occasions when a conflict of interest may occur (e.g. when negotiating contracts for the purchase of shared services from the Councils).
3.5.6 Health and Safety Schools in both boroughs will continue to receive Health and Safety advice and a delivery model for this service for both boroughs is expected to be agreed by February 2014.
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3.5.7 Communications This service will be provided by each Council’s communications teams in relation to services where AfC is the provider on their behalf. AfC will undertake activity as a company to market its services and a protocol will be developed between AfC and the Councils to ensure the company is compliant with the owners’ standards and also on information and data sharing.
3.6 Proposed Growth Strategy In support of this business case consideration has been given to the potential for AfC to grow and an initial overview is set out below. This covers the position of both boroughs with regard to Ofsted’s requirements.
3.6.1 A time for Integration - 2014 to 2015 Achieving for Children will become a separate legal entity in March 2014 and although many services will be integrated by that date a number will still be in the process of implementing service redesign. The Board of Directors and senior management team will embed the culture and values for the new joint service and reinforce the priority of delivering excellent services whilst striving to improve efficiency and pass financial benefit to service users and the Councils. Staff will improve their understanding of what is expected to deliver high quality evidence based best practice service.
AfC will focus on delivery of provision to the two founding Councils and will not proactively market services during this period. Any provision delivered to other clients will be marginal and opportunistic in order to expand or diversify the customer base for future trading.
AfC will begin helping the government turn the social care profession into one that is seen as highly rewarding and rewarded. It will do this by working in collaboration with partners in the voluntary sector to provide new opportunities for the training of social workers and other social care professionals, and will also create management development opportunities for those wishing to progress in the profession. The opportunities created by working across the two local authorities could be augmented by creating partnerships with other public bodies to do this work. AfC envisages a leadership academy that will both promote social work as a profession and drive high quality training for professionals within the sector; whilst the design of the leadership academy programme will begin in this period implementation is unlikely to start until 2016 onwards. AfC would look to engage quickly with university and other leadership groups and offer opportunities to attract high quality graduates through an internship programme.
By the end of 2015 the following success measures will be achieved:
§ New staff terms and conditions will be implemented where appropriate, everyone will be clear about their roles and what is expected of them in achieving financial targets and taking professional responsibility;
§ The integration of services will be complete resulting in a newly designed organisation which is fit for purpose with reduced management overheads;
§ All business processes will be in place including base surveys to monitor customer satisfaction;
§ Kingston will be out of intervention and progressing to good according to external inspection criteria; and
§ Target savings and efficiencies will be realised.
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3.6.2 A time for consolidation – 2016 to 2017 In 2016 there will be a focus on establishing Achieving for Children as a sustainable business. This will require additional commercial skills and business development capability with a need for new commercial roles and reinforcing a culture in which decisions are taken throughout the company with appropriate understanding of economic impact in tandem with providing high quality service. Staff will be confident in their professional influence to ensure quality outcomes and begin to seek new opportunities to extend their service offer and client base. They will have the power to direct surpluses within their own service team budgets for the benefit of their service users. Service users will have become accustomed to a high quality of service and will be more confident in demanding the service they want. Plans for a broader commercial offer to other public sector organisations and a medium term marketing strategy will be developed, with greater emphasis on actively promoting Achieving for Children’s services. By the end of 2017 the following success measures will be achieved:
§ Less expensive social care services will be necessary as the integrated early help and
preventative services reduce the burden
§ In excess of 65% of ICT systems will be integrated;
§ The company will have successfully managed the efficiency savings applied by the founding
Councils
§ Richmond will have had a successful outcome of any external inspection demonstrating that
services are at least good and internal quality improvement indicators are positive;
§ The medium term marketing strategy is developed; early signs of external recognition of AfC
as a provider with an increase in traded services by at least 10%; and
§ An analysis of adequacy of infrastructure needs is commissioned, and early negotiations with
the owners, about further potential freedoms to create ongoing efficiencies, has begun.
3.6.3 A time for Diversification – 2018 and on Achieving for Children will have built a track record of delivering competitively priced services, delighting customers and making a tangible difference to the quality of outcomes to users of children’s services throughout the two boroughs and beyond. By the end of 2018 the following success measures will be achieved:
§ 90% of the original business goals will have been achieved;
§ Company quality measures, client surveys and service targets will be at least 85% positive;
§ AfC will be operating in new market segments and traded services achieving increased
turnover of at least 17%;
§ Integrated ICT systems will set national standards; and
§ Directors will be working with the owners to approve the next phase of strategic development
to enable the company to continue to progress including succession plans for staff and
governance.
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3.7 Operational benefits summary
Type of benefit
Description Timescale Measure
Service Kingston will be out of intervention and progressing to good according to external inspection criteria
2014/15 External inspection
Service Integration of services across the Councils will be complete
2014/15 New organisational structure
Financial More efficient social care services From 2014/15 onwards
AfC Management Accounts
Service Richmond will have had a successful outcome of any external inspection demonstrating that services are at least good and internal quality improvement indicators are positive
2016/17 External inspection
Service Company quality measures, client surveys and service targets will be at least 85% positive;
2018 onwards
Contractual performance measures and client surveys
Business Increase in traded services by at least 10% AfC will be operating in new market segments and traded services achieving increased turnover of at least 17%;
2016/17 2018 onwards
AfC Management Accounts
Service Integrated ICT systems will set national standards
2018 onwards
To be determined
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THE IMPLEMENTATION ROUTE MAP
29
4 HR/OD REQUIREMENTS, RISKS AND
TIMELINES INCLUDING STAFF AND
STAKEHOLDER CONSULTATION
4.1 Transfer and assimilation of staff to AfC
4.1.1 Principles A range of principles have been informally explored with management and unions, to apply when transferring affected staff to AfC. All AfC posts will have Job Descriptions, Person Specifications and Grades within the (AfC) Structure. All staff will be employees of AfC with the exception of posts that need to retain particular statutory duties and functions. The Councils will continue to set the Director of Children’s Services salary as a Council employee. TUPE protection will apply to transferring staff but all appointments to new vacancies will be to the new AfC pay and conditions. New AfC pay and conditions are being developed, with the intention that they reflect and reinforce the values and focus for the new organisation. As standard, the TUPE transfer of staff will be carried out in formal consultation with staff and staff representatives, any intended changes to terms and conditions for transferring staff (such as a change in pay date,) will be presented in advance on the basis of an economic, technical or organisational (ETO) reason.
4.1.2 Interim arrangements Prior to the establishment of AfC as a jointly owned company with appropriate governance
arrangements an approach to managing the staff changes necessary to support integration of the
services across both boroughs has been required. A pragmatic approach with transparent and fair
arrangements has been adopted to work across both LBR and RBK. In this interim period there is a
balance of requirements; needing to change some roles and responsibilities whilst avoiding too much
turbulence, and recognising that any changes are a staging post to the new organisation.
4.1.3 AfC Terms and Conditions of Employment As a company jointly owned by RBK and LBR, AfC will be a separate employer with terms and
conditions determined through the appropriate AfC governance arrangements which are being
developed. The objective is to achieve benefits for AfC through [bringing together the best elements of
existing arrangements for local authority employment coupled with the flexibility available from a
separate company.]
One of the workstreams of the AfC programme is reviewing the options for future terms and conditions
to support AfC objectives of recruiting and retaining the best staff. The employment package will need
to be attractive, fair and affordable. AfC pay will link to the National Joint Council negotiating
framework for annual cost of living reviews, and will operate a job family structure tied to a single pay
scale.
Where TUPE applies staff will transfer and terms and conditions would be protected; however where
new staff are recruited they will be subject to new AfC conditions. Accordingly following the
establishment of AfC staff will be employed on different arrangements ie LBR, RBK and new AfC
conditions. Over time appointments into new posts will mean that more and more staff would be
employed on new AfC terms and conditions.
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Decisions will need to be made on the pension fund to which AfC employees could contribute, with the
simplest approach being for AfC to be affiliated to both LBR and RBK pension schemes and new staff
will be allocated a pension scheme on joining.
Subject to a formal application process, it is believed that AfC will be accepted as part of the
Modification Order which acts to recognize continuity of employment for redundancy purposes when
staff move between public sector organizations.
4.1.4 Proposed Approach to staff transfer and TUPE Implementation will include formal and informal consultations and job matching. Voluntary
redundancies pre transfer and redundancies post transfer may apply depending on certain factors.
Consultations within the Councils are being run in parallel from November 2013 complemented by
joint staff side meetings to include full-time officers if determined appropriate by local TUs.
For all Council staff intended to be transferred into AfC, the two councils would operate agreed TUPE
transfer procedures along the same timescales via the HR Shared Service. AfC will need to identify
any measures envisaged for staff resulting from the transfer of RBK and LBR staff. It will be important
to ensure that there is full and meaningful formal consultation with Trade Unions on any measures
identified to mitigate risk. The TUPE consultation has an inter-dependency with the development of
pay and conditions and Policies and procedures.
Any employees identified as redundant post-transfer may be offered rights against suitable vacancies
emerging within the two councils during any consultation and notice period, subject to statutory trial
periods.
4.1.5 Key Issues and risks The implications of pay and pensions in relation to the transfer of affected staff will be a key issue for
resolution throughout implementation. Also control of pension liabilities associated with any change
in AfC pay structures will be important.
Clarity will be required as to how the implementation programme will be resourced including significant
extra work on the engagement with the TUs and the design work associated with new terms and
conditions.
AfC will require a new payroll system, which will be provided via iTrent. Any new AfC terms and
conditions, along with clarity on the organisational structure will be required in order to build the new
payroll system, and this will need to be in place at point of transfer. The inter-dependencies of these
aspects of the AfC workstream does mean that delays in one area can result in significant overall
delays.
It will be important to ensure that required levels of savings year on year for AfC are clearly
communicated and are sufficiently connected to decisions on pay flexibility and decisions on staffing
numbers and overall design of new pay and conditions.
In parallel to the issues raised which directly relate to the establishment of AfC, it is worth noting that
at the same time work is required to reconfigure the respective Councils where staffing structures
need to change as a result of staff exits. Furthermore the structure of the HR Shared Service may
require alteration to ensure it is best configured to serve RBK, LBRuT as well as AfC.
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4.2 Stakeholder Engagement Extensive consultation and engagement has been carried out to ensure that internal and external stakeholders:
• understand the benefits of creating AfC;
• are kept informed of how plans to create AfC are progressing; and
• are involved in the creation of AfC.
4.2.1 Consultation with service users A programme of consultation and engagement has been delivered to gather the views of service users about the creation of AfC, and to enable them to influence its development and hence the delivery of better outcomes for children. This has included engagement with key stakeholders through updates and presentations at regular meetings and events as well as a specially commissioned set of six focus groups including parents and carers at children’s centres, parents and carers at family centres for children with special educational needs and disabilities, young people and looked after children. Five of the six focus groups included either Richmond only service users or both Richmond and Kingston service users, with one of the children’s centre focus groups being held in Kingston. The focus groups explored service users’ views on the intended benefits of AfC and gave them the opportunity to raise any issues and concerns. Whilst, as expected, there were a wide range of views, there was an understanding and appreciation of the benefits the new organisation could bring, particularly where frontline services could be protected by reducing costs and efficiencies. Participants did have some concerns about what the proposals would mean in practice for the services in which they had a direct interest and raised a number of wider questions about continuing to provide quality services that would meet the needs of both Boroughs. They were keen to be involved as the plans are implemented. Consultation and engagement activity has also been carried out with relevant service users on specific service changes proposed as part of the programme of review as services are integrated across the two Councils and this will continue as further services are reviewed, giving service users further opportunities to input to shaping the organisation. Richmond’s Equality Stakeholder Scrutiny Group and Kingston’s equalities groups have been involved throughout the development of the proposals for AfC and has had an opportunity to review and comment on key documentation.
4.2.2 Staff engagement A variety of approaches have been taken to involve staff in the creation of AfC. These have included:
• survey of 400+ staff across both boroughs, to understand staff’s understanding and concerns about the programme to develop AfC;
• fortnightly email briefings sent to all Children’s Service staff in both boroughs, and regular face-to-face briefing sessions held, to ensure staff are kept informed of progress;
• intranet sites (with mirrored content) set up across both boroughs; these include a list of FAQs with a generic email address for staff to contribute additional questions/comments
• specific consultations and surveys for staff to shape aspects of AfC, such as its vision and values framework, its appraisal process, and its approach to flexible working; and
• joint staff reference group of Children’s Services staff set up, which aims to improve the flow of information between staff and the Joint Management Team.
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4.2.3 Communication with partner organisations Regular communication has been carried out with partner organisations to keep them informed of developments, and provide the opportunity to shape future working arrangements. This has included updates to Headteacher Partnership meetings, voluntary sector network meetings, and other forums such as the Health & Wellbeing Board and Local Safeguarding Children Board.
4.2.4 Launch of AfC Proposals for launch activities include:
• Formal launch event for key stakeholders
• Drop-in style launch event for staff
• Engagement event for schools
• Engagement event for other key partners
• Launch event for young people
This will be accompanied by a wider communications plan.
4.2.5 Risks, Issues and timelines The key people/OD and stakeholder risks, issues and timelines are summarized below:
Type Description Timescale Commentary
Risk That the TUPE process is not completed appropriately
April 2014 This holds a very low risk as the process has been designed and carried out by experienced HR practitioners working closely with the Unions and staff.
Risk That the payroll system for AfC is not in place in time and a manual workaround is required
April 2014 The delivery of the payroll systems is being monitored by the Head of the joint HR Service and is subject to its own suite of project documentation.
Risk That continuity of service is out at risk. April 2014 This risk is deemed to be extremely low due to the coverage of the existing legislation and the intention to seek a Modification Order prior to the AfC launch date.
Risk That staff become disengaged during the formal consultation process
April 2014 This risk is deemed to be low due to the extent and depth of staff engagement undertaken.
Issue A mechanism needs to be determined for how new staff will be allocated to which Council pension scheme
April 2014 Work is underway to resolve this issue
Issue Work is currently being undertaken to assess and quantify the impact on the Councils of non Children's Services Staff moving into AfC.
April 2014 The resultant design work is underway and once completed the impact on the two Councils will be known.
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5 STATUTORY AND LEGAL FRAMEWORK – IMPLEMENTATION
ROUTE-MAP AND RISKS
5.1 Introduction The Councils have sought comprehensive legal advice from Counsel and Bevan Brittan, the jointly
appointed legal advisors, on all of the issues related to the creation of AfC and the delegation of the
delivery of Children’s Services to this jointly owned entity. The latter raises a number of complex and
important legal issues that have required a significant amount of work to map and will require an
interim scheme of delegations and a complete understanding of risk management to implement.
5.2 Context Under the Children Act 1989, local authorities have statutory duties to assist those with parental
responsibility with the care of children. This includes the provision of services for families within an
authority’s administrative area and the provision of accommodation for children of those
families. Under the Local Authority Social Services Act 1970, local authorities have “social services
functions” under various enactments which relate to the care, protection and safeguarding of children.
In addition, local authorities have significant statutory duties, principally under the Education Act 1996
and the School Standards and Framework Act 1998 (but also under other legislation), in relation to the
securing of efficient primary, secondary and further education including admissions, exclusions,
special educational needs and, numerous duties in relation to the financial and non financial
arrangements for the management of maintained schools.
A detailed analysis of all the statutory duties placed on local authorities was undertaken by the
Government with a view to reducing the burden of red tape. Whilst the promised reduction of statutory
burdens has not materialised, the audit of statutory duties relating to children’s services carried out by
the Department for Education identified 201 statutory duties placed on local authorities in relation to
the following themes (not an exhaustive list):
• looked after children;
• children and young people;
• education;
• special educational needs;
• schools;
• children in care;
• safeguarding children;
• adoption; and
• intervention.
The Councils legal advisors, working with the Children’s services team, produced a more detailed
analysis of the statutory duties and functions and have provided a route by which the transfer of duties
can be undertaken. More detail is contained below
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5.3 Transfer of functions Functions of a local authority can only be delegated where there is a legal basis to do so. There are currently two routes to achieve this currently though these do not provide the full solution. This means that it is not possible to transfer across to AfC everything that the two councils currently do in relation to the children’s services without having first completed an exercise to distinguish between the discharge of a statutory function and the delivery/procurement of services to enable the councils to discharge their statutory functions. The former needs to remain with the councils; the latter can be contracted out to an external provider, here AfC (without competition if Teckal arrangements are complied with, see section 6.5). The review has led to the following summary outcomes: With regard to Education and Special Educational Needs, legal advice is that the Councils’ duties can be delegated to a contractor (because there are deregulation orders applying to these services), apart from school attendance orders and the transfer of assets relating to academies which will be have to be retained by the Council. The social care functions are more problematic given that local authorities have a statutory duty of care in relation to “children in need”. Accordingly work has focussed mainly on the social care functions and analysis has identified the following issues: Adoption The Adoption and Children Act 2002 sets out the detailed functions and duties of adoption agencies, defined as either a local authority or registered adoption society. AfC will therefore need to register as an adoption society if it wishes to carry out these functions. Decisions about social care Local authorities have a number of statutory duties relating to care leavers, care planning, looked after children, safeguarding, children in need and children in care. These are usually discharged by its employees and in a number of cases these duties could be discharged by a seconded employee. However, in areas such as looked after children, the volume of decisions require that a number of council employees (including social work team leaders) would have to be seconded into Achieving for Children. Further details are set out in section 6.3.1 below Services which can be provided by a commissioned contractor Although the Council retains the statutory responsibilities for the exercise of functions, services to support decisions relating to childcare and child poverty can be provided by AfC as a commissioned contractor.
5.3.1 Detailed approach The Councils approach has been to find a solution which enables AfC to provide the full range of
children’s social services within a model that provides robust assurance to the Councils in meeting
their statutory duties. The Councils preferred solution is for the making of a Deregulation and
Contracting Out (DCO) Order and accordingly both Leaders have made a joint formal approach to the
Secretary of State for CLG, requesting his assistance to see how this might be achieved. and he has
responded positively, indicating that officials are in discussion with the DfE.
An informal meeting has been held with the DfE to explore the use of a DCO Order for this project.
There was an indication of support in principle for an exploration of whether this approach could work
in order to facilitate the innovation which AfC wishes to bring to the delivery of children's services. It
was agreed that once the DfE had successfully dealt with the passing of the 2008 Act regulations (now
achieved) further discussions could take place based on a note from the councils setting out how a
DCO Order would be obtained. This will be the next step in dialogue with the DfE.
As there is no guarantee in relation to this proposal nor that it can be delivered in the desired
timescale, the development of the most robust option for the Achieving for Children structure within the
current legal constraints will continue in parallel.
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This model comprises three elements; the recognition of the special role of the Director of Children’s
Services, the employment of specific groups of staff relating to social care functions and the
requirement for AfC to co-produce with the two councils an assurance framework.
Role of Director of Children’s Services
The Joint Director of Children’s Services (DCS) for both local authorities will be a Director of AfC and a
joint appointment of both Kingston and Richmond, employed by Richmond Council. This meets
statutory guidance that the DCS must report directly to the Chief Executive. Both Councils will be able
to direct the action of the DCS and this will be explicit in the contract of employment for the DCS.
Employment and secondment arrangements for specific groups of staff
A number of individuals whose role relates to making decisions about children’s social care, or other
functions which must currently be retained within the local authorities, will continue to be employed by
the Councils. This will include the two Heads of Social Care and a number of social care managers.
These officers will draw on the work of the staff employed by Achieving for Children to inform and
support their statutory decision making, which they will carry out as Council employees. These staff
could also be seconded to AfC for part of their employment. It is estimated that this will apply to
approximately 30 staff.
Assurance Framework
As well as the employment arrangements for staff described above, the Councils will seek assurance
through the commissioning arrangements, of the way that AfC will operate in order to support the
Councils in carrying out their statutory functions. The specification for services to be commissioned
from AfC will contain a description of those areas on which the Councils seek assurance, including:
• Safeguarding
• Supporting the corporate parent role
• Decision making for children in social care.
AfC will be required to describe how it will support these functions, including the numbers of staff
allocated, how the service will be designed, the operational impacts for AfC and how any secondment
arrangements will operate in order to fulfil their dual responsibilities.
5.4 Role of the Director of Children’s Services By section 18(1) of the Children Act 2004, a local authority must appoint an officer for the purposes of
its education and children’s services functions. Section 18(7) provides that a local authority must
have regard to any guidance issued by the Secretary of State for the purposes of section 18.
By section 18(8) two (or more) authorities may, if they consider that the same person can “efficiently
discharge” for both authorities the responsibilities of Director of Children’s Services (DCS), concur in
the appointment of a single DCS for both authorities. Accordingly, for the purposes of the section, it
appears that “appoint” does not mean “employ”. The DCS for is currently an employee of Richmond
and a joint appointment by Richmond and Kingston.
The Department for Education guidance issued earlier this year states that the Director of Children’s
Services has professional responsibility for the leadership, strategy and effectiveness of local authority
children’s services, including operational matters. The guidance goes on to state that the Director of
Children’s Services is responsible for the performance of local authority functions relating to the
education and social care of children and young people and for ensuring that effective systems are in
place for discharging those functions including where the authority has commissioned any services
from another provider. The guidance also states that the Director of Children’s Services should be a
first tier officer who reports directly to the Chief Executive.
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In terms of the legal duties imposed on company directors it should be noted that the main director duties are now set out in sections 171 to 177 of the Companies act 2006. In general duties are:
• a duty to act in accordance with the company's constitution and only exercise powers for the purposes for which they are conferred;
• a duty to act in the way the director considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole and in doing so have regard to various specified matters;
• a duty to exercise independent judgment;
• a duty to exercise reasonable care, skill and diligence;
• a duty to avoid a situation in which the director has, or can have, a direct or indirect interest that conflicts, or possibly may conflict, with the interests of the company;
• a duty to not accept a benefit from a third party conferred by reason of the director being a director, or his doing (or not doing) anything as a director; and
• a duty for the director to declare if he is in any way, directly or indirectly, interested in a proposed transaction or arrangement with the company, and the nature and extent of that interest, to the directors.
The Councils have been considering the employment status of the DCS in relation to the work being undertaken on the constitution of the AfC Board and the delegation of statutory duties and functions. It is the intention that the DCS will remain jointly appointed by the Councils and be seconded to AfC.
5.5 Procurement of AfC using the Teckal exemption
The benefit of the Teckal exemption means that the Public Contracts Regulations 2006 in respect of procurement would not apply and the Councils can contract with AfC without the need to go out to the market and run a competitive tendering process. In order to satisfy this exemption both the control and function test must be passed and remain passed throughout the lifetime of the Teckal exempt arrangement. The control test states:
(i) That the authority (or authorities) exercise control over the delivery vehicle which is to be awarded the contract (AfC) which is “similar to that which it exercises over its own departments”;
and the function test states:
(ii) That the delivery vehicle (AfC) awarded the contract carries out the essential part of its activities for/with the authority/authorities.
In respect of the Control Test it is worth noting the following points established in case law: Where there are several local authorities combined (as is the case with Richmond and Kingston) the control test can be satisfied so long as collectively the local authorities exercise control over the entity (AfC). Therefore it is not necessary that each local authority exercises such control. Although no individual authority has to have sole control of the company the participating authorities must have decisive influence over both the significant decisions and strategic objectives.
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Decisive influence is not completely satisfied if all the shares are owned by the relevant authorities. This is only one factor in the control test and due regard should also be given to the constitution and the board and the degree of control they have in decision making. The company's objectives need to be set out clearly in the constitution as this may influence the arrangements to pass the control test. In respect of the Function Test it is worth noting the following points established in case law:
• The function test is designed to ensure that the entity (AfC) remains within the public authority sphere and can not go out and compete with other suppliers on the open market as it would be unfair if the body could compete in that way.
• The entities (AfC) activities need to be devoted principally to the controlling authorities and any other activities can only be of marginal significance. 80% of activity in this instance was deemed sufficient but note this related to the Utilities legislation not the public contracts regulations.
In addition it is worth noting that the proposed new procurement directive, which is expected to come
into force in 2014, incorporates the Teckal control and function tests and under the current draft (that
is still subject to negotiation) provides that at least 80% of the entities activities need to be devoted to
the controlling authority for the purposes of the function test. Although there is no current specific
threshold for the function test under current case law, a 90 / 10 split is often used as a reference point
for what is acceptable.
What the above means in practice is that for AfC to ensure that it obtains and retains the benefit of the
Teckal exemption it must:
• be controlled by the Councils by ensuring not only shareholdings, but also the constitutional
documents (e.g. board appointment rights) and associated contracts (e.g. a shareholders’
agreement setting out key ‘reserved decisions’ that the board must refer to the Councils as
shareholders and a process for approving an annual business plan) give the Councils a
decisive influence;
• undertake the essential part of its activities to the Councils (with 80% potentially the threshold)
and there must be no private capital investment in the company.
Details on how the tests are being met are contained within the Section 8 - Ownership
5.6 Risks, Issues and timelines The key statutory and legal risks, issues and timelines are summarised below:
Type Description Timescale Commentary
Issue The existing legislation does not provide a simple pathway for the delegation of statutory duties held by a Council to a separate legal entity.
April 2014 A detailed scheme of delegations is being designed to capture how the statutory duties of the Councils will be discharged by the company and seconded employees.
Issue Making use of the Teckal exemption imposes a number of restrictions on the freedoms that can be offered to AfC
April 2014 The company model, articles of association and business plan have been created to comply with the requirements for using the Teckal exemption.
Issue The legal documentation required for the establishment of the company, contractual arrangements and management by the two Councils cannot be finalised and agreed before 1
st April 2014
April 2014 Drafts of the main documentation have been developed. Decision requirements are identified and internal and external resource
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have been identified for completion of documentation.
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MANAGING THE BENEFITS DELIVERY OF AFC
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6 GOVERNANCE
6.1 Corporate governance
6.1.1 Introduction The governance framework was developed to meet the following overall objectives:
• determine the arrangements for decision making
• clarify accountabilities and allocate roles and responsibilities
• enable the development of an agreed vision and strategic priorities for children’s services for each local authority and their expression as commissioning intentions
• enable the joint commissioning of services which will achieve the desired outcomes
• secure the delivery of, and report against, agreed objectives
• provide controls for assurance and risk management.
Given AfC is a jointly owned company, the governance framework seeks to enable the two Councils to:
• align their decision making on the services to be commissioned from AfC, but allow for differences in the services commissioned
• hold AfC accountable for the provision and delivery of children’s services commissioned by them and
• provide an assurance framework for the financial and quality aspects of the shared arrangement.
The framework encompasses the governance arrangements for AfC itself, the arrangements to allow
interaction between AfC and both Councils and the impact on each councils own governance
arrangements as a result. The governance model is designed for the agreed organisational model for
AfC - initially a Council-owned company – and any future departure from this model will require a
review of the governance arrangements.
6.1.2 Principles The governance arrangements are based on the following principles:
• Transparency and accountability for decision making secured through a clear governance framework, scheme of delegated authority and explicit Member role
• Clarity of responsibilities in order to hold AfC to account and ability of Councils to direct the actions of the Director of Children's Service
• Alignment with both Councils priorities reflecting their wider strategic aims
• Clarity of objectives and outcomes reflected in proportionate arrangements that support delivery
• Clarity of arrangements and responsibilities in order to hold AfC to account through robust and transparent contracts
These principles are our starting point for testing out our governance arrangements in terms of delivering robust decision making and clarity of responsibilities and the degree to which they meet those needs for each organisation.
6.1.3 Commissioning versus ownership The governance structures have been developed to reflect the joint role played by the Councils as commissioners and owners of the company.
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6.2 Commissioning governance The commissioning governance structure is captured in figure 6.2a below. The full terms of reference of each body and attendees are available on request.
Figure 6.2a – Commissioning governance structure
Section 7 Commissioning elaborates on the detail of procurement and contract management and
the Councils’ role as commissioners.
6.3 Ownership governance The ownership governance structure is captured in figure 6.3a below.
Figure 6.3a – Ownership governance structure
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Reaching a resolution on the corporate governance of AfC has required detailed thought backed up by
in depth consideration of:
a) Providing AfC with an appropriate level of autonomy that allows it to behave as an arms length
organization and operate in an entrepreneurial manner to deliver the operational and financial
benefits described in Sections 2, 3 and 4.
b) Meeting the requirements of the Teckal exemption.
c) Providing appropriate lines of control and accountability that ensures the statutory duties and
functions related to children’s services are met.
d) Providing appropriately robust arrangements to hold AfC to account for delivery of outcomes
and financial targets including in times of tough financial and delivery challenges.
The five corporate governance factors that have the greatest influence over these issues are:
• Employment status of the DCS
• Number of Non Executive Independent Directors on the board of AfC
• Number of Council employees on the board of AfC
• The reserved decisions retained by the Councils as the shareholders of AfC
• Robust commissioning and contract management responsibilities retained in the Councils
Section 8 Ownership elaborates on the detail of company governance and the councils’ role as
owners.
7 COMMISSIONING
7.1 Introduction The Councils wish to secure high performing services with quality outcomes for our residents. To do this, both Councils are committed to remaking the way in which public services are provided to promote new forms of delivery which will secure most savings, provide most freedoms and enable most innovation for children’s services. In order to secure these outcomes the Councils have chosen to follow a thorough and robust commissioning process. In conducting the detailed discussions during the commissioning process the Councils firstly agreed on the following principles:
• Decisions should not unfairly disadvantage AfC or either Council – “either all parties succeed or none”
• Change instigated by one Council should be borne by that Council including any consequential impacts on the other parties
• Arrangements should promote the lowest overhead cost across all three organisations rather than promoting a situation where one party is able to achieve savings at another’s expense.
The approach undertaken by the Councils has been to co-design Children’s Services with AfC and to be actively engaged in the improvement and development of services. Each Council has its own process for developing and agreeing its strategic priorities for Children’s Services which are described in their Children and Young Peoples Plans.
The starting point for the commissioning process was to identify the specific needs and priorities for each local authority and to then bring these together into a single joint effort designed to address local aspirations; this is captured in the Commissioning Intentions, refer to section ** below.
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The two Local Authorities have taken account of the common aspects and the differences in their commissioning intentions and have produced a specification (see section 8.5) that has clear common and differential aspects and which forms part of the contract documents.
The remaining contract documents are the contract (see section 8.4) and response to the specification from AfC.
7.2 Commissioning intentions The purpose of this document is to describe the commissioning intentions of the two Councils, including the framework that the Councils will use to commission services, the range of services that the two Councils wish to procure / secure in order to meet the outcomes identified in their strategic plans and the timelines for commissioning. A copy of the commissioning intentions is contained in ANNEX 2 to Report 2.
7.3 Commissioning cycle The Councils have aligned their commissioning processes into a single commissioning cycle in order to jointly engage with AfC and to provide an agreed set of products to inform commissioning. The cycle has 9 steps that follow the Analyse, Plan, Do, Review process as summarised below:
Commissioning Cycle Summary
1. Identify and prioritise outcomes for service users, residents and public (including setting strategic vision and Equalities Impact Assessment)
2. Look at particular groups of service users residents and public Analyse
3. Develop needs assessment with (i) user and staff information, (ii) a review of service provision and consideration of (iii) legislation and guidance
4. Identify Resources and Set Priorities Plan
5. Plan Pattern of services to meet service outcomes:
6. Decide what route/delivery model provides best value Do
7. Commission (including use of pooled resources)
8. Plan for market development Review
9. Monitor and review services and processes
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Two Council Owned AfC Owned Due Date
Strategic Direction Commissioning Intentions
2013-16 (includes two Council’s vision)
Commissioning
Commissioning Cycle for the Two Councils and AfC
Contract
Specification
AfC Tender Response
Performance Management Framework
NOTE: THESE 3 DOCUMENTS MAKE UP
THE CONTRACT
Contr
act M
anagem
ent
Serv
ice D
eliv
ery
October 2013
November 2013
November 2013
December 2013
November 2013
October 2013
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7.4 Contract The table below sets out the key points to be included in the contract subject to the two councils agreeing to commission services from AfC and the three parties agreeing to enter into a contract, a copy of which can be found in ANNEX 4 to Report 2.
Key term information Recommendation / status
Contract duration 7 years with option to extend up to a further 5 years.
Arrangements for contract management
See section 8.6
The contract review process This is under development and will be set out in our contract management approach and our annual commissioning cycle which includes an annual review of the commissioned service and contract.
Audit and Scrutiny Committees and the right to Audit AFC
AFC will be expected to attend scrutiny and Audit committees as required. The Councils will have the right to audit AfC. The Commissioning Cycle and contract management arrangements will help define the detail of these provisions
Intellectual property The councils are not intending to transfer any IP. Any appropriate IP will be licensed to AFC. New IP created for the councils by AFC will belong to the Councils. The council’s will retain IP on any products or services transferred to AfC. IP for new products and services developed by AfC will be retained by AfC. In the event of a doubt regarding IP for services and products in development, these should be alerted to the Governance meetings as appropriate.
Dispute resolution It is anticipated most issues will be dealt with through negotiation with the named point for contact. In the event of issues not being resolved through the governance meetings then the dispute resolution will be used. It is proposed to ensure a timely and robust dispute resolution mechanism.
Termination Clauses and default procedures
Termination and default procedure clauses are included in the contract to ensure the councils will have the power to take rapid action to protect the delivery of Children’s Services in event of failure.
Freedom of Information and Complaints
To ensure arrangements for FOI and Complaints are clear and effective. The contract will contain key terms reflecting the outcome of this work, addressing the responsibility of AfC to have in place an effective procedure for dealing with complaints in agreed timescales, and escalating these to the Councils where appropriate. AfC should have processes in place for handling FOIs relating to their delivery of services to children and for engaging with the Councils as appropriate to ensure these are dealt with effectively and within the required timescales
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7.5 Specification The specification is the key document in the commissioning suite. In addition to setting out the scope
of services it describes the:
• Service aims and objectives
• Legislative and policy context
• Interdependencies, partnerships and contract interfaces
• Contract management and reporting arrangements
• Payment terms and contract price
• Risk management
• Outcomes and performance
• Service delivery assurance requirements
The specification includes a list of the Performance Indicators to be used to measure the performance
of the AfC in delivering the contract. These measures will form a core part of the Performance
Management Framework.(see section 8.7) This list is in development, and targets are still to be set.
A draft of the specification is contained within ANNEX 3 to Report 2.
7.6 Contract management arrangements
7.6.1 Introduction The section covers the structures and procedures that the Councils are putting in place to manage the
contract with Achieving for Children. In designing the contract management arrangements the councils
have been conscious of balancing the requirement for robust and thorough performance monitoring
and not creating structures that are unnecessarily over complex or burdensome which would be
expensive for the Councils and AfC.
7.6.2 Structure The Councils have designed a lean yet robust commissioning approach that adopts the efficiencies of
joint elements where appropriate and the control of separate elements; providing overall balance and
agility; this is captured in Figure 7.6.2a.
Details of the roles and responsibilities can be found in Appendix 6.
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7.7 Performance management framework This performance management framework sets out the expectations of the Councils as
commissioners of AfC and details how they will hold AfC to account for its performance in delivering
the agreed outcomes and objectives for children’s services (at both the strategic and operational
levels) as set out in the respective CYPPs. A copy of the draft PMF is contained in Enclosure 3.
AfC will develop its own robust internal performance management framework and reporting
arrangements to manage delivery against the specification as set out in its Business Plan. These are
not within the scope of the PMF except insofar as AfC may need to provide assurance to the Councils
on its methodology to deliver outcomes where underperformance occurs or is projected.
The PMF underpins the governance arrangements for AfC by ensuring transparency and
accountability via the timely provision of key performance information at both the strategic and delivery
levels. The governance structure for AfC can be found here (insert hyperlink).
The PMF aligns with the CYPPs, the commissioning intentions, the service scope and the contract
specification and makes explicit the commissioner/provider roles in fulfilling requirements. It details
the performance measures and the processes for monitoring and reporting performance information
and the mechanisms for escalation of issues if required. Some of these performance measures will
measure performance on the agreed strategic outcomes and objectives whilst other measures will
against the contract specification.
The two Councils will align their expectations of AfC as far as is practicable in order to minimise the
reporting burden. There may be some differences in requirements between the two Councils which
may require the reporting of different performance information or the reporting of information to
different timescales to reflect the governance arrangements of the two Councils.
In addition to the PMF, the Councils will expect AfC to provide a range of information for a number of
purposes, including strategic planning, needs analysis and re-commissioning.
7.8 Equalities impact assessment An Equality Impact Assessment is in draft and being completed, which has so far found that that there
is likely to be no adverse impact on people with protected characteristics as a result of the
commissioning of AfC by the two councils. The EQIA/EINA provides assurance that by creating AfC,
the two councils would fulfil its obligations under the Public Sector Equality Duty, namely to:
• remove or minimise disadvantages suffered by persons who share a relevant protected characteristic that are connected to that characteristic;
• take steps to meet the needs of persons who share a relevant protected characteristic that are different from the needs of persons who do not share it; and
• foster good relations through tackling prejudice and promoting understanding.
The Specification states that the two Councils expect AfC to: o ensure that the needs of children and young people with protected characteristics are
taken into account in the design and delivery of services; o promote equality of opportunity and positive outcomes for children and young people
with protected characteristics; and o foster good relations between all children and young people, in order to tackle
prejudice and promote understanding.
The EQIA/EINA also highlights that eligibility for services will not be affected by the creation of AfC. Any changes to the eligibility for services in the future would need to be agreed with the two Councils, and subjected to separate Equality Impact Assessment. In addition Separate Equality Impact Assessments are being carried out on:
• the services to be included within Achieving for Children (AfC) or the design of the new company;
• staffing implications of the transfer of services to AfC. The draft Equalities Impact Assessment is contained in ANNEX 3 to Report 1 (=Appendix A).
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8 OWNERSHIP
8.1 Introduction The Councils are taking advantage of the Teckal exemption (see section 5.5) to commission Achieving for Children to deliver Children’s Services. The benefit of the Teckal exemption means that the Public Contracts Regulations 2006 in respect of procurement do not apply. To satisfy the requirements of the Teckal exemption, both the control and function test must be passed and remain passed throughout the lifetime of the Teckal exempt arrangement. The governance arrangements set-out within this section have been endorsed by the Councils legal advisors as meeting the requirements of the tests. More broadly, the ownership arrangements are to support the accountability of the two councils, and a number of “tests” will need to be developed to confirm that the arrangements are robust and that any risks such as conflicts of interest can be well managed. These tests will be considered as part of the annual review process for this contract.
8.2 Legal form of company Achieving for Children (AfC) will be established as a Community Interest Company (CIC) Limited by Guarantee. As a Community Interest Company (CIC) limited by guarantee, the members of the Company are the subscribing guarantors, in this case the two Councils. The term "member" is used here to denote the owners of the company. This can be confusing given that "member" refers also to local authority elected councillors. However member is the term used in all relevant statutory provisions and guidance about companies limited by guarantee and is therefore also used here. Although the day-to-day running of the company may be delegated to directors, the ultimate control of
the CIC and responsibility for major policy and other decisions rest with the members of the Company
as captured in the articles of association and memorandum of association (covered in section 9.3). This is a key safeguard for the Local Authorities as owners of the company. The general meeting of the Company’s members is its ultimate decision making body and members have statutory rights to require the Company to hold such meetings. They may also appoint and dismiss directors, approve major transactions and change the constitution of the Company. Decisions which can only be taken by the members (not by the directors) are called "Reserved Matters" and are set out in the Articles. To register as a CIC AfC must:
• Adopt a suitable constitution in the form of Articles, further details are contained in Section 8.3
and a copy is contained in ANNEX 3 to Report 1 (=Appendix A).
• Make a community interest statement declaring that its activities will be carried on for the
benefit of the community and how this will be achieved, further details are contained in
Section 8.3
• Satisfy the Regulator that a reasonable person might consider that the CIC’s activities are or
will be carried on for the benefit of the community. This is known as the “community interest
test”. The CIC will have to continue to meet this test throughout its life. A company will not
satisfy the test if it carries on certain political activities, or if a reasonable person might
consider that its activities are carried on only for the benefit of the members of a particular
body or the employees of a particular employer.
• Make a declaration that it will not be an excluded company (which briefly means that it must
not be owned or controlled by a political party or a political campaigning organisation).
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Further key features/ requirements
• A CIC operates in the same way as any other company. It has all the well understood
characteristics of a limited company such as a separate legal identity; the ability to enter into
contracts and own assets in its own name; and flexibility in borrowing and fund raising. The
separate legal identity means that a CIC will continue to exist despite any changes in
ownership or management.
• The directors can be paid or unpaid and have the same rights and duties as any other
directors.
• The members of a CIC have the same governance and decision-making role as in any other
company, but they (and the directors) are under a stronger obligation to have regard to the
wider community which the company serves and involve stakeholders in its activities than
might otherwise be the case.
• The asset lock and other features give confidence to those funding CICs (particularly those
not looking for any financial return) and also to wider stakeholders that the assets will be used
for the benefit of the community and not unduly benefit the CIC’s members
• CICs are required to produce an annual CIC Report, which will be delivered with their
accounts with a £15 fee to Companies House. This report will be placed on public record. The
Report must record the CICs activities and how it involved its stakeholders during the year.
8.3 Company documents The Memorandum of Association is a statement that the subscribers wish to form a company under the 2006 Act and that they have agreed to become members. The subscribers shall be Royal Borough of Kingston and the London Borough of Richmond Upon Thames.
The Articles of Association is the constitution for Achieving for Children; they set out the governance arrangements for the company and the procedural framework for meetings at both board and member level. A copy of the agreed Articles is attached as Appendix 8. Some of the key components of the
Articles are set out below
The objects of the company will be to carry on activities which benefit the community and in particular (without limitation) to serve the community by providing education services and social care services to children and young people (and in particular but not limited to children and young people in the London Boroughs of Richmond upon Thames and Kingston upon Thames) and to otherwise provide such services which provide, promote and enhance the education, development, health, well-being and protection of children and young people in London and surrounding areas."
The list of decisions reserved for members is the subject of final legal advice though it is likely to include the following:
Ownership of the Company
1. Permitting the registration of any additional Member of the Company. Constitution of the Company
2. Varying in any respect the Articles.
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Financial Management of the Company
3. Entering into any arrangement, contract or transaction with either a capital value greater than [£500,000] or revenue value greater than [£500,000].
4. Entering into any borrowing, credit facility or investment arrangement on behalf of the Company (other than trade credit in the ordinary course of business).
5. Dealing with any surpluses of the Company
Directors of the Company
6. Appointing and removing directors
7. Agreeing any remuneration terms for any directors.
Future direction and development of the company
8. Adopting or amending the Business Plan in respect of each Financial Year. 9. Agreeing any change to the main payscale, which is set to mirror the National Joint Council Payspine, or agree any change to the grading of posts in the AfC Senior Leadership Team (the Chief Executive Officer post and those directly reporting to it). 10. Forming any subsidiary or acquiring shares in any other company or participating in any partnership or joint venture (incorporated or not).
11. Amalgamating or merging with any other company or business undertaking. 12. Selling or disposing of any part of the business or Company
13. Entering into any arrangement, contract or transaction which is not within, ancillary or incidental to the Company’s Business or is otherwise than on arm's length terms.
14. Entering into any advanced discussions with any other local authority, to deliver children's services of any nature on behalf of the Company for that authority, including but not limited to: a) agreeing heads of terms for the provision of children's services on behalf of the Company to that authority; or b) executing or creating an agreement for the provision of children's services on behalf of the Company to that authority. Any such proposed agreement to provide such services must be documented within the proposed Business Plan for the following financial year and approved by the members of the Company prior to the Company providing such services.
15. Passing any resolution for its winding up or presenting any petition for its administration (unless it has become insolvent).
8.4 Members It will be a decision of the members whether any other organisation joins as a further member/owner
of the company. It is essential to demonstrate Teckal compliance that this is a member decision. If
another local authority became a member and wanted itself to benefit from the Teckal exemption, it
would need to become part of the collective control over the company to the same extent as the
current members. While the company and councils wish to operate on the basis of the Teckal
exemption, no private sector ownership could be allowed.
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8.5 Running the company There are a range of issues relating to how the company operates, all of which are set out in the
Articles contained in Appendix 8. The two levels of organisational arrangements for the company are
members (meeting at Annual General Meetings or Extraordinary General Meetings) and directors
(meeting as a board of directors). Relevant provisions in the Articles are set out in the sections below.
8.5.1 General Meetings
Details on the organisation of and voting at General Meetings are contained in the Articles.
8.5.2 The board of directors Achieving for Children has a board of directors. Directors are required by the Companies Act 2006 to
act in the best interests of the company for the benefit of its shareholder(s) and to avoid conflicts of
interest. A director’s obligations to the company are defined in the Companies Act 2006 which codified
the duties which all company directors must adhere to:
• a duty to act within their powers;
• a duty to promote the success of the company for the benefit of the shareholder(s) (in this
case the Councils);
• a duty to exercise independent judgment (subject to authorised restrictions / allowances
provided in the articles, e.g. taking into account the appointing Council’s interests);
• a duty to exercise reasonable skill, care and judgment;
• a duty to avoid un-authorised conflicts of interest (conflicts with the Councils can be
authorised);
• a duty to declare an interest in a proposed transaction or arrangement with the company.
Whilst the directors of AfC will owe the same duties as the directors of any other company, the
application of these duties will be more complex in the context of AfC given the requirement to 1)
second officers into AfC and 2) appoint a council officer as a Executive Director; this is illustrated
further in section 8.5.8.
8.5.3 Board Membership Directors include three types of representatives:
• Individuals from within the company, providing an internal perspective (Executive Directors);
• Individuals external to the company, not part of the Management Team and providing an
external perspective (Non –Executive Directors);
• Individuals external to and independent from the company, who are independent in character
and judgement and have no relationships or circumstances which will affect their judgement
(Non-Executive Independent Directors).
The final composition of the AfC board is the subject of ongoing legal advice and will be a combination
of the three types of Director
The board will also have a number of advisors to provide additional expertise.
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8.5.4 Initial Board Membership A shadow Board was established in May 2013 to provide advice and support during the process of forming the company and agreeing the commissioning intentions. For the purposes of continuity it was agreed that the shadow board should continue once AfC for a period of one year (envisaged to be one year from April 2014). The Non-Executive Independent Directors on the board and the expertise they bring are:
• Dame Moira Gibb - Social Care
• Jane Spencer – Education and Schools Richmond
• Carol Campbell - Education and Schools Kingston
• David Groves - Legal and Structural Reform of Public Services The Non-Executive Director on the board and the expertise they bring are:
• Leigh Whitehouse – Director of Finance, Kingston
• Cathy Kerr – Director of Adult and Community Services, Richmond The Executive Directors on the board and their areas of responsibility are:
• Nick Whitfield – Chief Executive
• Robert Henderson – Deputy Chief Executive The following individuals are advisors to the board:
• Darren Jacob – Business sector
• Paul Bettles – AfC Director of Finance
• Sylvia Chew - AfC Social Care Advisor
8.5.5 Chair The Directors may appoint one of the Non Executive Independent Directors to be the chair. David
Groves has been appointed for the period up to April 2015.
8.5.6 Decision-making by directors Quorum for Directors meetings The final details of what makes a quorum for directors meetings is the subject of ongoing legal advice.
Decision making at a meeting Questions arising at a Directors meeting shall be decided by a majority of votes where each director
has one vote and, in the case of equality of votes, the chair has a casting vote.
8.5.7 Recruitment process of Non-Executive Independent Directors The following process shall be followed to recruit Non-Executive Independent Directors at the conclusion of the one-year period.
• The Councils and the CEO of AfC shall agree on a list of skills, expertise and attributes that they are seeking the Non-Executive Directors to provide.
• It is expected that Non-Executive Directors shall have backgrounds of Business, Health and Social Care and Education.
• It is proposed that the there will be at least four Non-Executive Directors; two from a Business background and one from each of Social Care and Health and Education.
• The CEO of AfC will propose a list of potential Non-Executive Directors for consideration by the two Councils based upon the agreed category skills.
• The Councils can add to the list.
• The Councils and CEO shall carry out a jointly approved appointment process.
• The term of appointment for Non-Executive Directors is still be finalised
• The Councils may re-appoint Non-Executive Directors for a further term.
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8.5.8 Directors and Conflicts
The Chief Executive will be seconded to AfC from the Councils. This imposes a series of conflicting
responsibilities as is also the case with those director(s) who may remain council employees but are
appointed as directors on the board.
In relation to the directors' roles on the board, section 175(1) of the Companies Act 2006 states that "a
director of a company must avoid a situation in which he has, or can have, a direct or indirect interest
that conflicts, or possibly may conflict, with the interests of the company." This is often referred to
colloquially as a "situational conflict" and is to be distinguished from "transactional conflicts".
Situational conflicts are the inherent conflicts which exist because a director has loyalties to the
company as a director at the same time as loyalties to a third party. In relation to AfC, a director
appointed by either council could be said to have a situational conflict by virtue of being an elected
member, officer or other employee of a council. A director in this situation must either have his or her
conflict "authorised" (i.e. enabling that director to continue acting) or otherwise cease to act. This is a
common issue with joint venture or group companies where one or more directors are appointed by a
shareholder/member. It is particularly pertinent to Teckal companies where council directors have to
be on the board and will have a close connection (and therefore an inherent conflict) with the owning
councils in order to satisfy the Teckal test.
The Companies Act allows a director's situational conflict to be authorised in one of two ways, namely
by the company's shareholders/members or otherwise by the remaining "uninterested" directors. It is
also common practice to "pre-authorise" a situational conflict through the company's articles of
association i.e. by stating that, notwithstanding the situational conflict arising by virtue of a director
being appointed by a shareholder/member and/or by virtue of him or her being an elected member,
officer or other employee of a shareholder/member, the conflicted director can continue to act. Given
the articles are a contract between the members and the company, this "pre-authorisation" is in effect
the equivalent of a member resolution. This approach will be adopted for the AfC directors.
Those directors who are council officers (either partly through secondment arrangements or fully
because they are remaining in council employment) will also have to address potential conflicts in their
role as council officers. This will require them to
• Formally get council permission for their directorship and for this to be recorded on their
personnel file. The role will be unpaid.
• Consider when a matter relating to AfC comes to either council for decision, whether they
have an interest which needs to be openly declared and recorded in the minutes of the
meeting (this will be the case in most instances) and whether it is appropriate for them to
participate actively in the item (usually it will be acceptable – the whole point of the council
appointing them as directors is to enable them to participate in issues relating to AfC).
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8.6 The Councils role as members (owners)
8.6.1 Members agreement The members’ agreement will set out how the shareholders will act including the list of decisions reserved to shareholders, board appointment rights, any funding obligations and agreed arrangements around exiting as shareholders.
8.6.2 The Joint Committee The Joint Committee between the Councils was established in May 2013. The Joint Committee has the delegated authority to agree on behalf of each Council:
• the Commissioning Intentions (to include service scope, resource requirements and expectations of the Joint Service)
• an annual assessment of Achieving for Children’s performance against the requirements outlined in each Council’s Commissioning Intentions.
• the future direction of Achieving for Children, including its governance arrangements and development of commercial potential including as a social enterprise
Responsibility for approving their own Children and Young People’s Plan remains with each Council. These documents, which will be aligned as far as appropriate, would set the overall strategic direction for AfC.
8.6.3 Membership and Voting Rights The membership of the Joint Committee is made up of six people. LB Richmond, because it operates the Leader and Executive model, has appointed three Cabinet Members whilst RBK has also appointed three Members but, because of its different governance arrangements these appointments are on a politically proportionate (2:1) basis. The Joint Committee currently includes the two Leaders and Members with responsibilities for Children’s Services. The host Council provides the Chair and there are two Co-Chairs (one from Kingston and one from Richmond). These appointments have been made by the respective Councils. In relation to voting rights, it is envisaged that the majority of decisions will be reached on the basis of a broad consensus. If votes are called for the Joint Committee will operate on the basis of a vote per Authority rather than individual Members having voting rights. A conflict resolution mechanism has been agreed to deal with any equality of votes. For the Committee to be quorate there must be at least two members of each Authority present (i.e. four in total).
8.6.4 Alternate Members In LB Richmond individual Members can nominate a substitute to attend in their place if they are unable to be present. RBK operates a system of Alternate Members on many of its Committees whereby for each Member appointed there are up to three Alternates formally appointed by the Council. Each local authority will continue to operate its own system in relation to alternate/substitute members of the Joint Committee.
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8.6.5 Meeting Arrangements As a formally established body, the Joint Committee is subject to the Access to Information legislation with meetings open to the public other than when “exempt” business is to be transacted. The decisions that the Committee expects to take will also need to feature on the respective Forward Plans of the two authorities and be subject to the normal procedures relating to them.
Arrangements for public participation are different in each borough. At LB Richmond members of the public may participate in meetings subject to having given advance notice (by 12 noon on the previous day) of their wish so to do. At RBK most Committee Meetings have a period of question time (usually 30 minutes) at the beginning with opportunities for members of the public to participate during debates. The Councils will record joint meetings until such time as both are in a position or required to film.
For the Joint Committee it has been decided that a period of public question time of up to 30 minutes is allowed, with the public giving advance notice (by 12 noon on the previous day) of their questions.
Venues for the meetings alternate between the two boroughs with the host borough providing the Chair and servicing arrangements.
8.6.6 Procedure Rules The Joint Committee has a detailed set of Procedure Rules (Constitution) covering its operation which has been approved by both Councils. The establishment of the Joint Committee on a formal basis also necessitated a number of changes to the Constitutions of the two Councils, which have been put in place.
It should be noted that, once AfC becomes operational as an entity, further changes to the Constitution are likely to be needed particularly in relation to the remit of the People’s Services Committee at Kingston and officer delegated powers at both authorities.
8.6.7 Overview and scrutiny LB Richmond and RBK operate different arrangements for Overview and Scrutiny. Richmond has a number of Overview and Scrutiny Committees, one of which relates specifically to Education and Children’s Services. In RBK the Scrutiny Panel has been retained but tends to be more reactive in its nature primarily dealing with called-in decisions and any “Community Call-Ins”.
It is proposed that regular reports are submitted to the appropriate bodies (in Kingston’s case, this is more likely to be the People’s Services Committee) and that consideration be given to the possibility of holding a periodic Joint Overview and Scrutiny meeting in order to scrutinise AfC’s performance.
The Joint Committee will be subject to the call-in arrangements that operate, in different forms, at both Councils. A Richmond call-in would be dealt with by the appropriate Overview and Scrutiny Committee. A Kingston call in will be dealt with by the Scrutiny Panel.
The formal member overview and scrutiny arrangements are in addition to the requirements for reporting in the contract and the Councils position as the owners of AfC and the entitlement this delivers for regular reports and updates.
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TRANSITION MANAGEMENT
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9 KEY ACTIVITIES AND MEMBER DECISIONS This section sets out the key activities and member decisions that are necessary to achieve the launch date for AfC of 1
st April 2014. A full implementation programme is currently being developed.
9.1 Key activities There are a number of strands of key activity that will lead to the successful launch of AfC on 1
st April
2014:
1 Achieving the necessary formal member agreements
2 Establishing AfC as a Community Interest Company with all of the necessary regulatory
processes completed and the management systems in place
3 Transferring the staff into AfC
4 Finalising and executing the suite of legal documentation including the intra-authority
agreement and contract
5 Revising the constitutions, organisational structures and processes of the two councils
9.2 Key member decisions Members of both Councils ask being asked to take three key decisions up to April 2014; these are as follows:
Decision Richmond Kingston
To approve the commissioning intentions
Joint Committee 2nd
December
To set-up AfC as a jointly owned Community Interest Company Limited by Guarantee
Cabinet on 16th January
Policy and Resources Committee on 13
th February
To commission Children’s Services from AfC
Cabinet on 16th January
Policy and Resources Committee on 13
th February
To set the 14/15 budget for Children’s Services
Council on 4th March Council on 27
th February
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10 RISK AND ISSUE MANAGEMENT
10.1 Approach Risks and issues are activity managed by the project at three levels:
There are two other mechanisms that used to manage and mitigate the project risks. Firstly, key risks
and issues are reported to the monthly Joint Officer Boards as part of a dashboard report that also
covers progress and budget. Secondly, the project follows the corporate gateways systems in the
Councils; in Kingston this is known as the Shared Services Framework and in Richmond the Tollgate
process. In both cases the business case will have to pass through the Gateway 3 – Implementation.
10.2 Key risks The key risks and the mitigations for the implementation stage of the project are set-out below and a
full risk register is contained in Appendix 10.
Strategic and Corporate
Those risks that require action or decision outside of the project governance in the formal council decision making mechanisms (SLT/ CMT, Kingston PSC, Richmond Cabinet)
Project
Those risks with required actions or decisions that can be taken at the Joint Officer Board or Joint Officer Group.
Workstream
Those risks with required actions or decisions that can be taken within or between the workstreams.
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Key risks for implementation stage
Description Likelihood
(1-5)
Impact
(1-5)
Combined
(1-25) Mitigation
Insufficient resource is secured to deliver the AfC
project in accordance with the agreed timescales
5 3 15 Active resource monitoring at both workstream and programme level.
Documents:
AfC Milestone Schedule and Detailed Programme
Workstream Project Plans
Monthly reports to Joint Officer Board in June and July
Unable to reach agreement on the treatment of
staff pensions moving into AfC
2 5 10 Early work to determine the likely financial implications to aid decision making
Documents
Draft admission agreements
Correspondence DCLG
Delivering AfC puts a too greater strain on the
existing Integrated Management Team and
standards slip in Richmond and Kingston.
3 5 15 AfC workstream to be externally supported. DCS actively monitoring
resource demands
Documents:
Proposals for business support - Jan
Path to improvement in Kingston falters due to
demands of setting up AfC
3 5 15 DCS actively monitoring resource demands.
Documents:
Improvement Plan
Ofsted launch inspection in Richmond that leads
to delays in the delivery of AfC
3 5 15 Continuous performance monitoring by DCS
Documents:
That the Duties and Functions work determines
that the organisation design of AfC has to
change substantially
2 4 8 Councils lawyers are reviewing advice against less risk averse position.
Documents:
Analysis of duties and functions
Papers to JOB in June and July
That the decision to commission AfC is subject
to a judicial review because insufficient
consultation had been undertaken with end
users and their representatives
2 4 8 A consultation is being carefully considered and developed and will be
proposed to the JOB.
Documents:
AfC EqIA.
Enclosure 1 – Detailed scope of services
Service Detailed Requirements
Children’s Social Care – maintain a separate division for each council
Services to safeguard children and young people
Provide a single point of contact for safeguarding concerns about children and a single access point to services.
Work collaboratively with other agencies to plan and coordinate investigations, enquiries, interventions and other services to support children and young people in need of help and protection from harm.
Provide information, advice and guidance to agencies on appropriate strategies to safeguard children and young people from harm or the risk or harm.
Investigate and complete statutory enquiries where children are considered to be at immediate risk of significant harm.
Undertake statutory assessments to determine which children and young people need help and protection from harm.
Ensure an appropriate level of intervention to families where children are in need or at risk of significant harm including the development, implementation and monitoring of children in need plans and child protection plans, and application to the courts for supervision orders, interim care orders, care orders and other legal proceedings as required.
Produce, deliver and review the care plans for children and young people in need of help and protection from harm, including the provision and/or commissioning of appropriate interventions and other services.
Licence children participating or employed in entertainment, modelling and sports events to ensure they are appropriately safeguarded and protected.
Support and actively engage with the Local Safeguarding Children Board to improve multi-agency arrangement for the protection of children including actively contributing to case reviews and serious case reviews.
Provide a Local Authority Designated Officer (LADO) to investigate and resolve allegations made against employees and volunteers working with children and young people.
Managed the statutory inspection of services for children in need of help and protection, children looked after and care leavers.
Services for looked after children
Produce and deliver appropriate care plans for looked after children in line with their assessed needs with an emphasis on ensuring permanency at the earliest opportunity
Provide and/or commission appropriate and stable placements for looked after children.
Provide supervised contact arrangements for parents whose children are looked after by the local authority.
Independently review the care plans and care arrangements of all looked after children through the appointment of an Independent Reviewing Officer for each looked after child.
Support and actively engage with the local authorities’ corporate parenting arrangements.
Fostering and permanency services
Ensure timely permanency arrangements for looked after children and young people including special guardianship orders, residence orders and long-term fostering arrangements.
Recruit, assess, prepare and approve prospective foster carers.
Assess and support family and friend carers.
Assess and support special guardians.
Provide and/or commission appropriate and stable foster care placements which meet the needs of the local populations.
Maintain a Fostering Panel including the provision of professional advice and a designated decision-maker.
Match and place children in appropriate foster care placements.
Manage a Fostering Allowance scheme and coordinate payments to foster carers.
Review foster care placements and provide ongoing training and support to foster carers.
Promote and manage a notification and assessment scheme for private fostering arrangements.
Adoption services
Recruit, assess, prepare and approve prospective adopters.
Maintain an Adoption Panel including the provision of professional advice and an agency decision-maker.
Match and place children in appropriate and stable adoptive placements including completing legal proceedings.
Review adoptive placements and provide ongoing support to adopters and adopted children.
Manage payments to adopters, special guardians and carers eligible for residence order payments.
Services for young people leaving care and unaccompanied asylum seeking children
Provide support to ensure looked after children and young adults leaving care receive appropriate education and training and achieve good educational outcomes (including employability).
Work cooperatively with local health agencies to ensure looked after children and young adults leaving care are healthy and achieve good health outcomes, including good emotional and behavioural resilience.
Produce support to young people in their transition from local authority care to independence and adulthood. Provide support to care leavers to ensure they have access to appropriate and stable accommodation.
Assess and provide care and support packaged to unaccompanied asylum seeking children.
Locality Based
Services for children with special educational needs & disabilities (SEND)
Identify children with disabilities living in the local area, maintain a register of children with disabilities, and work collaboratively with other agencies to plan and coordinate services for children with disabilities and their families.
Provide and/or commission impartial information, advice and guidance services to support children with disabilities and their families.
Produce statutory assessments to ascertain the needs of children with disabilities and their families.
Produce, deliver and review care plans for children with disabilities and their families, including the provision and/or commissioning of appropriate interventions and other services.
Provide and/or commission respite care and short-break care for children with disabilities.
Manage the system of direct payments to children with disabilities and their families.
Work collaboratively with adult service providers to plan effective transition to greater independence and adulthood.
Assess the needs of children and young people who may need a statement of special educational needs.
Ensure that the education provision in each statement of special educational needs is delivered effectively.
Review each child’s or young person’s statement of special educational needs annually.
Ensure sufficient and suitable education provision for children and young people with special educational needs.
Manage the funding of educational placements for children and young people with special educational needs.
Monitor the quality of education provision for children and young people with special educational needs.
Deliver support packages and interventions (counselling, cognitive therapies, solution-focused work) to schools to raise the attainment of children with behaviour, emotional and social difficulties (and other vulnerable children).
Provide psychological advice and support to schools and families in response to critical incidents in the community.
Provide psychological advice and support to schools to raise the attainment of children subject to child protection plans and looked after children.
Family support services
Coordinate the Common Assessment Framework to identify and assess children and young people’s needs at an early stage, and ensure the appropriate provision and review of multi-agency support and services.
Produce assessments to determine which children and young people require family support.
Provide and/or commission support and interventions to prevent family breakdown and to enable children to remain in their own homes rather than escalate to statutory child protection services.
Deliver parenting support and skills programmes and interventions.
Work collaboratively with local authority housing services to ensure young people have access to appropriate housing.
Work collaboratively with the statutory children’s social care services to divert children and young people from care and to keep families together where this is appropriate.
Appendix 2 – Draft ICT Strategy To be completed.
Appendix 3 – Commissioning intentions
See Report 2 Appendix B “Commissioning Children’s Services from Achieving for
Children” 16 January 2014 ANNEX 2.
Appendix 4 – Contract
See Report 2 Appendix B “Commissioning Children’s Services from Achieving for
Children” 16 January 2014 ANNEX 4.
Appendix 5 – Draft Specification
See Report 2 Appendix B “Commissioning Children’s Services from Achieving for
Children” 16 January 2014 ANNEX 3.
Enclosure 2 – Contract management Joint Contract Administration
The role of the Joint Contract Administration function is to:
• Maintain the suite of contract administration documents including:
• Register of variations
• Register of change control forms
• Issue into the contract variations as requested by the contract managers
• Issue into the contract change request forms as requested by the contract managers
• To provide the secretariat to the Joint Commissioning Group and Joint Commissioning Board
• To ensure that AfC provides the reports and other information as required by the contract.
• To provide reports to the Joint Commissioning Group.
Should be done by a individual jointly appointed by the Councils.
Contract Management Functions
The role of the Contract Management function will be:
• To advise the Lead Commissioner on the capabilities and constraints of the contract with AfC.
• To act as the main responsible officer with detailed knowledge of the contract with AfC
• To set the agenda for and chair the Joint Commissioning Group
• To provide reports and commentary on papers for the Joint Commissioning Board
• To formulate contract variations and change control requests on the basis of the strategic
requirements from the Lead Commissioner.
• To work with AfC’s contracts manager to agree service and performance improvements and
efficiencies
• To oversee, monitor and manage the contract at strategic and operational level with AfC
including spend analysis, performance analysis and supply chain management
• To review the reports from AfC and provide commentary to the Lead Commissioner.
• Maintain and develop the professional relationship between the Council and AfC
Enclosure 3 – Draft Performance Management Framework 1. PURPOSE OF THIS PERFORMANCE MANAGEMENT FRAMEWORK
Introduction The Royal Borough of Kingston upon Thames (RBK) and the London Borough of Richmond upon Thames (LBR) are committed to securing high performing services with quality outcomes for residents. To do this, against a backdrop of spending restraint and an ambition for improvement, both RBK and LBR have explored the way in public services are provided and are promoting new forms of delivery which will:-
§ secure the best outcomes for residents
§ secure most savings
§ provide most freedoms
§ enable innovation.
The two Councils have commissioned a jointly owned company - Achieving for Children (AfC) - to deliver children’s services across both boroughs. The two Councils’ visions and strategic objectives are expressed through:-
§ LBR’s annual Corporate Plan
§ Destination Kingston (the council’s medium term Service and Financial Plan)
§ the two Children and Young People’s Plans (CYPPs).
Together these documents set out the outcomes that the Councils aim to secure for the children, young people and families of the two boroughs. These are encapsulated in the commissioning Intentions for children’s services (insert hyperlink). The contribution that AfC is expected to make to delivery of these outcomes is set out in the specification (insert hyperlink ) which forms part of the contract between the two councils and AfC. Purpose of the Performance Management Framework (PMF) This performance management framework sets out the expectations of the Councils as commissioners of AfC and details how they will hold AfC to account for its performance in delivering the agreed outcomes and objectives for children’s services (at both the strategic and operational levels) as set out in the respective CYPPs. AfC will develop its own robust internal performance management framework and reporting arrangements to manage delivery against the specification as set out in its Business Plan. These are not within the scope of the PMF except insofar as AfC may need to provide assurance to the Councils on its methodology to deliver outcomes where underperformance occurs or is projected. The PMF underpins the governance arrangements for AfC by ensuring transparency and accountability via the timely provision of key performance information at both the
strategic and delivery levels. The governance structure for AfC can be found here (insert hyperlink). The PMF aligns with the CYPPs, the commissioning intentions, the service scope and the contract specification and makes explicit the commissioner/provider roles in fulfilling requirements. It details the performance measures and the processes for monitoring and reporting performance information and the mechanisms for escalation of issues if required. Some of these performance measures will monitor progress on the agreed strategic outcomes and objectives whilst other measures will measure performance against the contract specification. The two Councils will align their expectations of AfC as far as is practicable in order to minimise the reporting burden. There may be some differences in requirements between the two Councils which may require the reporting of different performance information or the reporting of information to different timescales to reflect the governance arrangements of the two Councils. In addition to the PMF, the Councils will expect AfC to provide a range of information for a number of purposes, including strategic planning, needs analysis and re-commissioning. These expectations are set out in the xxxxxxx and are not within the scope of the PMF. 2. RESPONSIBLE OFFICERS
With regard to performance management, AfC will nominate:-
§ a senior manager responsible for compliance with this performance
framework reporting on delivery of improvement actions and attending
meetings with the Councils
§ a day to day operational contact responsible for providing data and resolving
queries on that data.
With regard to performance management, the Councils will each nominate:-
§ a senior manager responsible for compliance with this performance
framework, and agreed improvement plans where necessary
§ a day to day operational contact responsible for receiving data from AfC and
resolving queries on that data.
3. MEASURES
This performance framework contains a set of indicators including, where necessary, proxy indicators to measure at specified time intervals:-
§ AfC’s progress against the outcomes and objectives set out in the Councils’
strategic planning frameworks and reflected in the commissioning intentions
and service scope. This includes any social value outcomes to the delivery
of which AfC will contribute, in line with the Public Services (Social Value) Act
§ AFC’s delivery against expectations about the quality and quantity of the
services to be delivered, as set out in the contract specification, including
AfC’s duties under the Equality Act 2010 both as a provider of services and as
an employer.
There is one set of measures with one set of definitions underpinning the performance framework, so that where the same outcome or objective is being measured for each Council, it is done in the same way. The set of measures and their definitions is contained in the Data Schedule which is attached at Appendix A. AfC, in conjunction with the Councils, will complete a data sheet for each agreed measure in the Data Schedule. The data sheets are a record of agreed data parameters and arrangements and act as a data quality check. An example data sheet is attached at Appendix C. Each Council may decide that a particular measure should not be reported for services delivered for their Council. 4. TARGETS Targets are agreed between the Councils and AfC before the commencement of the contract and through a cooperative planning process. Targets will be reviewed as part of the annual review process by both Councils and AfC. Targets are set for each of the measures within the performance framework where this is appropriate and meaningful. The priorities set for and by AfC will impact on target setting. Priority issues and those issues that carry significant risk will need challenging targets. These will be offset by less challenging (or no) targets for less risky issues or those issues which are not priorities. To promote transparency, and where this adds value, a rationale for why a target value has been selected will be produced as part of the target setting process. Whilst the trajectory of targets will correlate across the two Councils, targets may be set separately or jointly by the two Councils. The intention will be to set one target across both Councils but local flexibility may be needed to reflect factors such as different local priorities, differing baseline data and factors such as population and need.
Timescales set for achieving targets will be challenging and appropriate to the measure. Where possible, annual targets will be set. However, strategic outcomes targets may be set for achievement over the long term. Where longer term targets are set, interim proxy measures and targets may be agreed. Initial targets will be based on:-
§ the Councils’ aspirations for individual services covered by the contract and
the outcomes they wish to achieve, including improvement requirements to be
reflected in stretch targets where appropriate
§ understanding of likely demand, changes in population, statutory
requirements etc over the period of the contract
§ performance baseline and trajectory where this is available.
Setting targets on one data point may introduce one-off variation into targets. Therefore, wherever, possible, target setting will be based on longer term trend performance data. Thresholds will be set for each target to quantify tolerances for reporting exceptions. Thresholds will also determine the RAG status for reporting. The setting of thresholds and the definitions of RAG status will be included in the cooperative planning process. If a target is missed at the end of the reporting period, AfC will describe what has been done to improve performance, how those actions impacted on performance and why these actions were not successful. 5. CHANGES TO THE PMF
The suite of measures will be reviewed annually and may be adjusted by agreement, as set out in the contract, between the Councils and AfC. For example, this may be required to reflect changes in strategic direction as expressed through corporate plans, the Medium Term Financial Strategy and CYPP. Targets will also be formally reviewed annually and may be adjusted by agreement between the Councils and AfC. The annual review will take into account the resource implications of any such changes, financial circumstances and/or increasing or decreasing demand. A new data sheet will be required for any amendments to measures or any new measures agreed at the annual review. In exceptional circumstances, in-year changes may be required to either measures or targets in which case they will be agreed at the regular meetings between the Councils and AfC in line with the arrangements set out in the contract.
6. PERFORMANCE IMPROVEMENT
Where contract monitoring identifies under-performance against targets as reported through the measures in the framework, responsibility for improvement will rest with AfC. Where under-performance persists or is significant, improvement action will be agreed between the respective Council and AfC. In case of failure to address underperformance to the Council’s satisfaction, the default procedures as set out in the contract may be invoked. Escalation procedures in the case of under-performance are set out below:- 1. Where performance against target is reported as amber or red, AfC will, as part
of reporting arrangements:- - provide a commentary to the Operational Commissioning Group explaining
the underperformance and what is being done to address it - advise whether any action is required by the Councils.
2. The Councils’ nominated responsible officer(s) will review the action proposed by
AfC to determine whether it is likely to deliver the improvement required in the
timescale needed and if necessary agree further action with AfC. Should it not
possible to reach agreement, this will be escalated to the Children’s
Commissioning Board.
3. Where performance against a target is reported as red for two monitoring periods
or deteriorates from amber to red from one monitoring period to the next,
signifying that planned improvement action has not – or not yet – been
successful, the nominated responsible AfC officer will be expected to:-
- account for the underperformance - present proposals for remedial actions for agreement between the Council(s)
and AfC - attend Children’s Commissioning Board or Joint Committee meetings as
required.
The Children’s Commissioning Board may require AfC to put in place an improvement plan which will set out how improvement will be monitored and measured and at what timescales. AfC will be expected to provide progress reports on the implementation of the improvement plan to the Operational Commissioning Group at an agreed frequency and in an agreed format. Where the above actions have been taken and performance has not improved, or a serious and sudden deterioration in performance occurs, the Operational Commissioning Group will consider whether invocation of default procedures in line with the contract is appropriate.
Where audit or external inspections highlight performance concerns, or individual cases bring to light failure in practice or cause for concern – including as a result of a Serious Case Review – the Councils reserve the right to require AfC to take whatever action, and within whatever timescale, the Councils consider necessary to address the concerns identified. This may include the provision of additional performance information at more frequent intervals than set out within this performance framework.
7. DATA SUPPLY AND ANALYSIS
AfC will be a key supplier of source performance data and commentary in relation to the services it provides to the Councils. Information is supplied according to the detail set out in the reporting and data schedules. Occasionally, one or both Councils may require further analysis to be provided by AfC, to clarify an issue or ambiguity within the data or commentary provided. The Councils may seek to add value to the performance data and commentary supplied by AfC with further contextual data and analysis if this is deemed necessary.
• The Councils will make contextual information available to AfC as required including both children-specific and wider demographic and economic information. 8. DATA QUALITY
AfC will put in place arrangements to provide assurance as to the quality of the data supplied to the Councils under the contract and will provide the Councils with details of those arrangements. The councils may audit AfC source data as part of their corporate data quality strategies and plans. 9. REPORTING ARRANGEMENTS
The principles for reporting AfC performance are that it will be:- § transparent
§ simple
§ un-bureaucratic
§ timely.
AfC will be responsible for reporting on its delivery of agreed strategic and service outcomes and objectives through the supply of source performance data and commentary to:-
§ enable the Councils to hold AfC to account through their democratic
processes and provide transparency about service delivery to residents and
service users
§ facilitate contract management by the commissioners on behalf of the two
Councils.
The performance reporting framework is attached at Appendix B. The reporting framework will be reviewed as and when necessary to reflect any changes to Council governance arrangements. Performance information will be provided to the two Councils within agreed timescales and at a frequency which allows underperformance to be identified and addressed at the earliest possible opportunity. This means that:-
§ different measures may be reported to different timescales (eg monthly,
quarterly, annually)
§ there is an expectation that some information may be required to be reported
in a ‘raw’ state ie as soon as it is available rather than after full data cleansing
has taken place.
For each of the agreed measures in the PMF, AfC will provide at the agreed reporting interval (eg monthly, quarterly annually) and in the agreed format:-
§ outturn figure, performance against target, trend data, RAG status and
commentary in a format to be agreed between AfC and the two Councils
§ in the case of underperformance, reason for underperformance and remedial
action being taken
§ progress reports against remedial action plans which have been agreed with
either or both Councils
§ any additional information required as a result of performance improvement
action
§ any additional contextual information requested by the two Councils, for
example to determine and agree targets
§ attendance of the nominated senior responsible AfC officer as required to
account for performance at:-
- Operational Commissioning Group (monthly)
- Children’s Commissioning Board (quarterly)
- LBR Education & Children’s Services Overview & Scrutiny (maximum four
times per year)
- RBK People’s Services Committee (at least annually).
The Councils will provide;
§ Covering reports including any additional contextual information to inform, add
value and, where appropriate, challenge the analysis provided by AfC.
In addition, RBK will provide to AfC;
• Data reports that provide outturn figures, performance against target, trend
data and RAG status (where applicable)
• Complex report building, existing report amendments and any new reports as
required.
Appendix 1
DATA SCHEDULE
Measure Links to Frequency of reporting Audience
• . For each agreed performance measure, this will detail:- § The agreed measure definition
§ The agreed target and thresholds which will determine RAG status for reporting
§ The source of the data
§ Reporting geographies
§ The reporting arrangements from AfC to the councils (system, format)
§ To whom the data will be reported (the recipient(s))
§ The reporting arrangements to the recipients(s)
§ The agreed reporting interval
§ The agreed formula used for calculating the measure
§ The baseline data used
§ Period of data to be used for trend analysis
§ Benchmarking information (where appropriate and/or available)
§ Data quality checks undertaken
§ The agreed data review date.
Appendix 2
REPORTING SCHEDULE Key
Individual Council reporting Joint oversight bodies
Body Performance
information/report Frequency
Purpose of performance reporting
RBK People’s Services Committee
AfC Annual Report and more regular reports if required
Annual § Hold AfC to account for delivery of strategic outcomes and overall financial performance
§ Review progress in the delivery of corporate priorities
LBR Cabinet Corporate performance report by exception AfC Annual Report and more regular reports if required
Quarterly Annual
§ Hold AfC to account for delivery of strategic outcomes and overall financial performance
§ Review progress in the delivery of corporate priorities
LBR Education & Children’s Services Overview & Scrutiny Committee
AfC Annual Report and quarterly updates on company performance (TBC) LBR corporate performance report (relevant extract to show progress against corporate priorities)
Annual/quarterly Quarterly
§ Scrutinise the performance of AfC
§ Review progress in the delivery of corporate priorities
RBK SLT Performance Board
RBK corporate performance report covering key activities, strategic PIs, workforce and financial performance.
Quarterly
• Review progress against strategic outcomes and consider interdependencies with other Council services
• Review progress against corporate priorities
LBR Executive Board
Summary of AfC contract management report, including performance indicators by exception LBR corporate performance report covering corporate plan PIs, strategic programmes/projects and business critical indicators
Quarterly Quarterly
• Review progress against strategic outcomes and consider interdependencies with other Council services
• Review progress against corporate priorities
Joint Committee (JC)
Contract monitoring report showing progress against a set of high level indicators aligned with the commissioning intentions.
Quarterly initially, moving to six-monthly
• Hold AfC to account for the delivery and performance of services described in the commissioning intentions
• Inform strategic decisions and explain context for any changes proposed through annual refresh etc.
Children’s Commissioning Board (CCB)
Contract monitoring report showing progress against a set of high level indicators aligned with the commissioning intentions.
Quarterly • High level contract management, reviewing progress in delivering strategic outcomes
• Consider trends in performance where available
• Review areas of underperformance as highlighted by the OCG
• Inform discussions around service redesign to improve efficiency etc.
Operational Commissioning Group (OCG)
Detailed contract monitoring report, showing progress against performance measures (input, output, outcome) aligned with the commissioning intentions
Monthly • Inform contract management meetings with AfC representatives to review performance against commissioning intentions
• Identify any performance issues or unmitigated risks for escalation to the JCB
• Explore emerging priorities from within the commissioning intentions or other external issues which could impact upon performance or create a potential need to review priorities
• Ensure that approaches to performance management remain aligned.
Appendix 3
EXAMPLE DATA SHEET
A data sheet is to be completed for each agreed performance indicator. This information acts as a record of agreed data parameters and arrangements and as a data quality check
PI unique reference number
AfC……………
Date of introduction and reason for PI
Eg - Introduced xx/xx/xxx. This PI helps to monitor progress towards the achievement of xx outcome in the CYP plans for RBK and LBR
PI Title
Replicate the exact wording used and list title and issuing body of any guidance - for example, CIPFA – and the hyperlink to that guidance if available
PI description & definition
For recycled NIs or other national or benchmarked indicators, please use the standard definition For LPIs please define precisely what the indicator measures For all PIs include the agreed target and whether this is a stretch target
The calculation formula
Include here the unit of measure, number of decimal places & time period covered NB it is particularly important for LPIs that all data used in the process of production and calculation is clearly set out.
Methodology Explain how the data are collected. Include enough detail so that someone else can repeat the process and achieve the same result
Reporting frequency
Include here the frequency of reporting (eg monthly, quarterly annually) Include agreed data turnaround date, any data lag, how long it is and the reasons for it If interim raw data are to be provided, list caveats to interpretation
Reporting lines
Include here the audiences to whom this data and its interpretation will be reported (eg Committee, Cabinet, the public, contract monitoring officers)
Geography List the geographical areas for which the data are produced (eg RBK, LBR, ward, bespoke geography
Trends List the period for which historical data are available at time of PI adoption. Include any gaps in data and their dates. Give reasons for the gaps if known
Data verification
Where are the source data held (for audit purposes & future reference) List any computer or manual files used to access source data for calculations What controls are in place to prevent input and calculation errors (manual, spreadsheet and computerised) Is there a clear audit trail for the production of this PI? Identify from where copies can be obtained, with file path where relevant.
Data review Give here the frequency of formal review of this PI and the actual date for the next review
RESPONSIBLE OFFICERS ………………………………………………. AfC ……………………………………………….. LBR ……………………………………………….. RBK DATE OF SIGN OFF …………………………………………..
Appendix 8 – Draft Equalities Impact Assessment
See Report 1 Appendix A “Establishment of Achieving
for Children” 16 January 2014 ANNEX 3.
Appendix 9 – Draft Articles of Association
See Report 1 Appendix A “Establishment of Achieving
for Children” 16 January 2014 ANNEX 2.
