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Getting the balance of services right Should buildings based services be externalised? Should existing services be closed and new, more relevant services be commissioned externally? Incremental change rather than step change? Overview The balance between the amount of services managed and staffed by council employees and those contracted from the independent sector is essentially a political one. However, officers have a duty to appraise councillors of the implications of those decisions whether in budgetary or service quality matters. The balance of in-house and externally provided services should be considered in the context of the business planning cycle and the medium term financial plan. A prudent Council will keep its balance between in-house services and externally provided services under review for each service area and ask the following: Key questions for councillors:
Should buildings based services be externalised? The cost benefits of directly externalising an in-house service have diminished in recent years due to:
Nonetheless council's face continual financial pressures which call into question whether the remaining in-house services can be sustained. A scenario in the Commissioning module examines this issue: "You have in house residential services for older people that are considerably more expensive than independent provision" Key Questions for councillors:
Should existing services be closed and new, more relevant services be commissioned externally? The focus of debate has moved from externalisaing existing services to replacing them with more appropriate services. For example most councils are exploring the replacement of residential care with extra care schemes, or supported living arrangements. The period of open access to transitional housing benefit prior to the Supporting People grant, encouraged that exploration. Some council's have moved to floating support teams which undertake some tasks previously undertaken by care staff but now entirely funded from the supporting people grant. Key Questions for councillors:
Incremental change rather than step change? Whilst the shift in the balance of buildings based services requires a complete change process, the shift in balance of community based services can be achieved in a more gradual way. Over recent years the balance of in house home care to contracted home care has shifted, often through a gradual process taking advantage of the natural turnover of staff . This has advantages such as reducing de-commissioning costs (eg redundancies) but there is a risk that the change is unfocused and the respective roles of the two sectors are not clear. Incremental change is often done by increasing spot purchasing, this may have some initial advantages but in the long term is unlikely to be as cost effective as a cost and volume contract with a provider. Key questions for councillors:
The service user is in receipt of a council service, regardless of whether the provider is in-house or externally provided. However the political scrutiny of the externally provided services is often under developed. Key questions for councillors:
Many councils have seen the in-house sector and external sector as quite separate. Others have started to use their in house service in a focused way and sometimes in partnership with external providers. For example the two sectors can work together in recruitment and training events. Key questions for councillors:
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