Although Councils are tasked with slashing budgets whilst maintaining (or even increasing) the quality of public services, the endorsement of local authority strategic commissioning as a potential solution is seen by many councillors as dangerous ground upon which to tread.
In fairness, their reticence is understandable. We recently reported that Cornwall County Council leader Alex Robertson was ousted from his role in the wake of his attempts to finalise a hefty strategic commissioning contract. And even more recently, Barnet Council’s leader Richard Cornelius faced a vote of confidence centered on the £1b “One Barnet” outsourcing controversy. Computer Weekly described it as an “outsourcing revolt“.
So what exactly is “wrong” with local authority strategic commissioning? Why all the controversy? And in the face of such adversity, why should Councils still strongly consider it as a viable option?
Political Issues and Commercial Trust
We’ve already discussed one of the main fears surrounding strategic commissioning — that local jobs will be lost. But what many people don’t appreciate (or at least choose to ignore) is that job losses are typically unavoidable under any circumstances in the current financial climate. In reality, outsourcing can in fact result in a net job gain over many alternatives (such as a poor integration of neighbouring councils, for instance).
But regardless of the reality of the situation, job losses are always going to be a political sore spot — something that the public will jump on (not to mention back-bench and opposition members). As such, it is natural for councillors to fear strategic commissioning for what it can represent superficially.
This can lead to paranoia surrounding the intentions of outsourcing providers — will they reduce more jobs than initially pledged? Given that just about all commissioning contracts are long term deals, the fear of being trapped into an inescapable job loss situation is enough to keep you up at night.
As we have discussed previously, there are key cultural differences between customers and providers which must be recognised and addressed. The provider has a duty to its shareholders which, in most circumstances, is likely to override its duty to its customers. Fear of outsourcers misrepresenting the details of job losses in strategic commissioning contracts are essentially grounded in this culture clash issue.
The Resolution
However, such concerns should never pose an insurmountable obstacle to outsourcing success. The key, on a foundational level, is good due diligence.
If you are concerned that a strategic commissioning tender is unrealistic in its promises, seek to validate the provider’s claims. If something seems too good to be true, do your homework. Any outsourcing contract should be subject to financial and quantitative scrutiny, but the importance of such action only increases as you wander into the realms of public accountability and political game playing (as demonstrated by Barnet Council’s labour opposition being all too eager to wax hysterical on the “gambling” of tax payers’ money).
Furthermore, reference checks against prior performance are a necessity. Knowing that a provider has worked with Councils on similar projects before, ask their existing customers whether the provider delivered on (and stuck to) their promises of better performance, minimising job losses (or creating a new jobs gain) and maximising value? In other words, did they discharge their duties in an appropriate manner?
If you can independently validate the promises made by a provider who has a track record in effective service delivery, not only can you present this data as evidence of the viability of outsourcing, but you can demonstrate a much lower exposure to risk. Because let’s not forget — when you put all the political bluster to one side, effectively implemented, local authority strategic commissioning partnerships can be an extremely attractive option. One can expect an improvement in service delivery partnered with substantial (double digit) cost savings.
If you want to understand how to achieve such a favourable outcome, download our free white paper: 5 Steps to Successful Strategic Commissioning.
Creative Commons image courtesy of
