Whole-systems commissioning, whereby different services work together in an integrated way to fulfil the needs of beneficiaries at the heart of the system, could improve cooperation between small and medium-sized charities and local authorities, according to a new report.
The report, produced by the think tank the New Local Government Network and called All Together Now, is based on interviews with council and charity representatives, a survey for local authorities, two workshops in London and Liverpool to test how whole-systems commissioning would work in practice and two regional round tables in Manchester and London.
The report says that introducing a whole-systems approach, and its focus on social value and longer term views on value for money and quality of service, as well as emphasis on greater collaboration between organisations, will help small and medium-sized charities and increase engagement between councils and the voluntary sector.
To successfully implement a whole-systems approach, the report says local authorities should put social value "at the heart of the commissioning process" and continue to provide grants for lower value, specialist contracts. It says this approach will "level the playing field for small and medium-sized charities, allowing them to bid to provide better quality services for people’s interconnected needs".
But it claims that a closer relationship between local government and the voluntary sector has generally not happened, with financial pressures forcing "both partners into a defensive crouch, both expecting more of each other than either are able or prepared to deliver" and causing "already fractious relationships" to further deteriorate.
Approximately 23,000 charities closed between 2008/09 and 2013/14, the majority of which had incomes of less than £500,000 a year, the report says.
It argues that many charities "simply do not fit in to the new commissioning landscape", which focuses on putting out fewer, but larger, aggregated contracts to tender.
The report says "the work needed to bid for these often favours bigger organisations" and introducing a whole-systems approach could help correct this.
It says: "Councils should facilitate smaller organisations in the commissioning process through a cycle of engagement and collaboration, gaining insights into the sector and communities on a continuous basis.
"These organisations are at risk of a race to the bottom, and communities are at risk of losing vital support, if they are not enabled to access contracts. Councils should ensure that social value is more than a ‘duty to consider’ and instead is an intrinsic element of a successful bid, for example through increasing the weighting attached to social value in evaluating bids."
The report also recommends incentivising whole-systems approaches and increasing engagement between partner organisations.
Claire Mansfield, co-author of the report and head of research at the NLGN, said: "As local councils have moved from being primarily grant-givers to commissioning bodies, we could see that the process was leaving many small and medium-sized charities unable to take part in servicing their local communities as they once had. But they still retained the local knowledge, experience and – vitally – relationships with people that councils don’t necessarily have.
"What we found through our research is that if all key partners work together we can create a commissioning process that focuses on the needs and ambitions of people. It is only by doing so, that councils can truly achieve the maximum value from their commissioning process."