Concerns with procurement, tendering and commissioning in the drug and alcohol sector

Quietly in meetings over coffee I and other CEO’s and senior managers in the sector have been sharing concerns for years about poor procurement and tendering in the drug and alcohol sector. When I spoke to Martin Barnes, CEO at Drugscope the umbrella organisation for the drug and alcohol sector, recently shared the long standing and growing concern with the state of commissioning and procurement in many areas.

However to address the issue we need evidence of the impact on staff, organisations, and examples of poor practice and waste. (How much does it cost service providers to tender, how much money do commissioners spend on consultants?) We cannot just complain about the process we have to demonstrate its impact, unfairness, and consequences for service users and on service provision and quality. It is perfectly legitimate for local authorities to retender work provided to them by contractors, however in the context of Big Society there needs to be a level playing field for the third sector and local third sector providers.

Poor and frequent commissioning has a number of serious consequences not least of which is the cost. An exercise to quantify the costs of tendering services over 10 years ago came up with a figure of £300,000 as the cost expended by all bidders and the commissioner per tender.

Low Morale

At a recent provider meeting with Public Health England (PHE) in London concern was raised by PHE about the low morale of staff across the treatment system.

Feedback by those there was that this was due to;

  • Constant rounds of retendering of services.
  • Changing goal posts (and the lack of thanks for a job well done).
  • A TUPE cycle of 1 year job insecurity – 1 year changing an often great service to something different unclear and underperforming (if you keep your job and even if it’s still with the same provider) – 1 year performing in a new role (often excellently) – 1      year job insecurity.  Often this cycle is truncated and eventually inevitably leads to worker burn out for many people.
  • Many services have been retendered several times over a three year period inevitably causing insecurity and disruption to service delivery.
  • Worries about costs cutting by Local Authorities in the coming years and further redundancies.
  • The current lack of direction and leadership in the sector.
  • Most people not having had a pay rise for 4 years.

Procurement, tendering and contracts

We have to accept that tendering of services is here to stay and that providers will all win and lose contracts, however I think there is a case to be made to increase from the standard 3 year contract to a 7-10 year minimum contract length or possibly longer.

The contracts are often very one sided and allow cancelation with three or six months notice.  Often providers are asked to agree to the contract as a condition of being allowed to tender which is clearly unfair. Contracts need to be far less easy for Local Authorities to wriggle out of with an expectation that any but the most major changes required are done via contract variation rather than retendering except where there are clear performance issues.

At Blenheim we are concerned about the minimum turnover requirements that are beginning to affect the ability of small providers to tender for contracts they currently hold. This is where to bid for work you have to have a minimum turnover of say £5 or £10 million.  I am aware of many smallish and medium sized charities that have not been able to bid for their own contracts back in their own right forcing them into shot gun marriages with other providers as junior partners. This has on occasions included Blenheim despite us being in the top 750 charities in the UK by income out of 66,000 charities.

Partnerships have a lot to offer and Blenheim is in many great and highly effective partnerships but they rarely work well when they are marriages of convenience.

Blenheim is concerned that we are starting to see the demise of local third sector organisations operating and attuned to local communities and their replacement by profit motivated or organisational survival motivated or growth driven organisations. This I already hear and see impacting detrimentally on service provision.

Blenheim is concerned about minimum standards in the drug and alcohol sector with the move to Local Authority commissioning and the demise of the National Treatment Agency. Providers are all being forced to compete on price rather than quality and this has a direct impact on who is employed or made redundant. The people service providers employ and their skills and ability is what makes the difference to the mothers, fathers, children, sisters, uncles, neighbours, friends and grandparents with a drug or alcohol problem we are here to help. These people deserve a quality service delivered against exacting standards of performance and staff competence not the cheapest available.

Blenheim is deeply troubled about the many instances of poorly managed tendering processes which create huge wastes of time and effort both at commissioning level and within provider organisations. This is now a regular occurrence and issues have included;

  • Unfair decisions which when challenged are changed or not.
  • A lack of transparency about the process.
  • The number of tendering processes which have to be suspended due to flaws in the process.
  • A lack of knowledge about tendering and procurement within tendering teams.
  • Complete lack of understanding by many commissioners of TUPE rules.
  • Attempts to dump significant pension liabilities on incoming organisations where NHS or Local Authority is the outgoing organisation.
  • Sometimes completely ludicrous and unworkable specifications.
  • Transfer of risk from Local Authorities to providers via Payment by Results with poor data to assess risk and often in relation to performance targets the provider has little      control over.

At Blenheim we think its time we should stop talking and start acting as a provider and a sector to raise these concerns via Drugscope and other forums.

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9 thoughts on “Concerns with procurement, tendering and commissioning in the drug and alcohol sector

  1. As some who has worked in this sector (in the NHS) for over 30 years it is a waste of tlme and money and destroys cooperative working and creates tinpot dictators
    Pity the poor clients

  2. Dear John
    Sadly you have put it so well. I keep hearing more stories of poor commissioning and unnecessary tendering. As you say this is wasteful and agree with Bedalerover how this can destroy joint working. The staff can suffer but the real losers are always the people needing the service. Tendering seems to be often based on cost and quality is forgotten. I particularly see this in general practice, where we see and care for patients long-term, wherever they are on their journey (OST, drug-free, relapse and many more) but commissioners are moving towards only valuing (and hence paying for) patients being abstinent.
    My other surprise is that we are all doing so little collectively to challenge this. We need to work together to fight these attacks.

  3. If we don’t get to the bottom of the problems with the commissioning of drug services, and the lack of morale and impetus in DSP staff, we are never going to make drug treatment any better.

    The drug treatment system in the UK was the best in the world, and look at us now.

    As it stand currently, things change on a whim, and it’s the service user (who let’s not forget, are actual human beings) who always suffers.

    Service user’s are not guinea pigs, and the sooner commissioners realise this and stop all this enforced treatment, the sooner people will be able to recover.

    BTW – Great blog John!!

  4. This is a really brave and bold article. I concur fully with the views and I am now working exclusively with smaller organisations because of this issue.
    I have grown tired of watching bidding by buzzwords result in underinvestment and staff devoid of passion and innovation worrrying or not about who will pay them next.
    Its excellent one of the big small organisations has said it. I may even renew my drugscope membership.

  5. Hi John
    I agree that the commissioning cycle should be longer. I’m a big fan of Keiretsu, the Japanese model used by global car manufacturers of developing a long term partnership with their suppliers so that the success of the business becomes a joint enterprise. I also think it would be much more effective to make the payment by results incentives retention of contract, rather than financial bonuses. You could have a 5 year contract which, if it met its outcomes at the end of year 4, was extended for a further 5 years giving everyone security and the ability to plan improved services.
    Thanks for raising the issue.

  6. Hi John
    I agree (mostly) very much with what you’ve said.
    I’ve worked in the field since 1994, and have been a senior NHS clinician, trainer, and manager since 2000. So I’ve witnessed the birth, and have seen the death (transformation?), of the NTA.
    I think the current state of commissioning is really pretty poor. In fact, ‘commissioning’ as a concept and practice has been reduced (traduced?) over the last decade from a total population ‘vision and outcomes’ endeavour to one that apparently has mere concern for technical aspects of procurement, tendering, and performance management.
    So-called commissioners (and let us be frank, they are for the most part fairly junior commissioning ‘officers’) are in many ways essentially slavish data managers by-proxy anyway these days. In my, perhaps singular, view I think this is the historic legacy and influence of the NTA, whose centralised dictat around tools, frameworks, and targets effectively deskilled the commissioning body, and turned ‘commissioning’ into a mechanistic and wasteful rump. I don’t think the location of APTB commissioning in ‘Community Safety’ has helped either.
    I confess that I come from the vantage point of the NHS rather than the 3rd sector, so obviously I have an angle. And which is why your concern about “Attempts to dump significant pension liabilities on incoming organisations where NHS or Local Authority is the outgoing organisation” may be the only point on which I perhaps disagree with you, because I believe that NHS staff subject to TUPE need their employment rights protecting. Having said that, you may also agree that their rights need defending – I think that you do – and your real objection is probably that this challenge is usually swerved by the tendering officers.
    But this is a very good blog indeed.

  7. We received this comment from Kelly Pegrum;

    I have been working as a provider for almost a year now, after moving from the DAAT in Wandsworth where I spent nearly five years. Whilst the landscape in which DAATs or what is left of them, are working is becoming increasingly challenging, I too am concerned at some commissioning practice and it has to be said, some provider’s activity that I have seen & what this means for the future of the sector.

    I agree, there appears to be little evidence that this relentless cycle of tendering is improving the quality & effectiveness of services & outcomes for service users. In fact, it can sometimes appear to be de-stabilising services, reducing the morale, quality & number of staff in the sector & producing a highly competitive environment, at risk of eroding partnership work which isn’t bound by contractual ties. I also fear that little attention is paid to those individual services which are highly performing & producing excellent outcomes….as this often does not figure in evaluation criteria.

    You asked for some examples, these are some of the specific issues that concern me:

    1. The Application of TUPE
    This is an on-going issue not yet fully resolved by the courts….very risky for all involved.

    2. Clinical Governance
    I have seen many tender documents where questions on clinical governance, prescribing practices or managing clinical risk rarely feature. I think this is dangerous.

    3. Transparency
    In some of the tenders I have been involved in as a provider, there doesn’t seem to be much emphasis put on the principles of fairness / transparency. In fact, I have sometimes felt there to be a very un-level playing field.

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