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Item 3 is to take evidence on home care services for the elderly from two witness panels. I welcome Annie Gunner Logan, director of Community Care Providers Scotland, and invite her to make some opening remarks before we move to questions.
Thank you for giving me the opportunity to come and talk about this subject on behalf of CCPS, which is a membership association of upwards of 60 of Scotland's most substantial providers of care and support services in communities. Our members support considerable numbers of individuals and families, usually under formal contractual arrangements with local authorities, using public money. Our members' experience of social care tendering encompasses home care services for older people and extends to many other areas of care where procurement is an equally significant issue, including services for people with learning disabilities, mental health problems, sensory impairment, addictions and, increasingly, children and family services.
Thank you. Before we move to questions, I give members notice that we will finish this evidence session at approximately 11:30.
You mentioned some of the tensions around the procurement process. Will you say a bit more about your member organisations' experience of electronic auctions, which was one of the most contentious issues covered recently in the media?
So far, only two authorities have used an e-auction for care services: the City of Edinburgh Council and South Lanarkshire Council. No other authorities have used that process. One or two of our members participated in the South Lanarkshire process. Only one or two participated, because the starting price—the indicative price—was such that most of our members wrote themselves out of the process right at the beginning.
Indeed, I do not want to focus all our attention on e-auctions, although they sound a bit like eBay in reverse—
That is exactly what they are.
Can you say a bit more about those two e-auctions? Did your member organisations start with a bid that was higher than what they anticipated the final price would be? You mentioned the dangers of cutting corners. What calculations were your member organisations making during the hour and a half—or whatever it was—that they had? What corners were they cutting?
Our members made their calculations beforehand, which is why a number of them never entered the process in the first place. If we come on to consider how the unit costs of voluntary organisations differ from those of services that are provided in-house, we can discuss that further.
From the point of view of your organisations, how does £10 an hour compare with what would be considered to be the going rate, or a respectable or reasonable price? Is £10 an hour an abnormally low figure?
Yes. For our members, that would certainly be the case. For voluntary organisations that provide home care services, the mid-range price would be somewhere between £14 and £18 an hour, depending on the needs of the individual and on the required skills mix, such as the level of qualifications and the level of management supervision. Obviously, the more support the individual needs, the more resources we need to put behind that. For in-house services—home care for the elderly is still pretty much dominated by in-house council teams—our information is that local authorities would struggle to go below £20 an hour. It would be north of £20 an hour. However, for some home care services for older people that have been tendered—including the South Lanarkshire auction—the starting price has dropped below the level at which the majority of our members would enter the competition.
Obviously, the South Lanarkshire Council area includes some reasonably rural locations. To what extent are you confident that e-auctions—and procurement processes more generally—take into account the driving times and distances involved? The fact is that a lot—as it is rather uncharitably called—in Clydesdale might be rather more difficult to get to than a lot in the city.
Absolutely. The expectation is that providers will build that into the hourly rate in their bid. Highland Council currently has a live home care tender and such issues will obviously be a terrific consideration for any providers that submit a bid. Up in Sutherland and so on, such issues really need to be taken into account. The expectation is that providers will build that into their rate for the job.
You said that you do not want to reduce our inquiry to the issue of e-auctions, but is not a danger of e-auctions that people might get caught up in the process and go below the level that they think is best?
That is the risk, certainly. For many organisations, and for private sector companies in particular, this is their business and their livelihood. When I have talked to people who have been involved in any e-auction—admittedly, I have seen only a dummy run and have not personally participated in an e-auction—the words "frantic" and "panic" have been used. People are absolutely against the clock. They are bidding for services that are being retendered. That means that the business already exists and is not a new service that has developed, so people are not simply growing their organisation. In effect, they stand to lose the business of providing those services, so the sense of needing to hang on to them is probably quite significant.
You also said that there have been only two or three e-auctions. Is there an expectation that people will not engage in them or that they will not be used in the future?
I cannot speak for local authorities, but I suspect that, because of the level of concern that there has been about the e-auctions that have already taken place, and some of the publicity that they are attracting, there is a feeling among local authorities that they do not want to go there. As far as providers are concerned, if an e-auction is set up and that is how funding is to be acquired, then providers will respond to it. However, as I said, the starting price is might knock out a lot of organisations right from the off.
Would it be useful if it were stated that the practice is morally repugnant and that care services should not be traded like cheap jewellery?
That would certainly be my view.
Perhaps we need to be absolutely clear about that.
Yes.
We have focused on e-auctions, but I understand that other local authorities are engaged in bidding down, which involves them setting a figure and contractors bidding below it. How does that run in relation to the voluntary sector? Community Care Providers Scotland, which represents many members, talks about full cost recovery for the services that are provided. However, is there not a contradiction between your members asking for full cost recovery on the one hand and, on the other, having to bid for contracts at a price that does not match what they would expect the full cost of the service to be?
That question helpfully draws out some of the issues.
The converse to that is the quality of the service that is delivered. The "Panorama" programme on the services that Domiciliary Care (Scotland) Ltd provided showed that the quality of care and attention that the end user was receiving was disgraceful. Some of the service users were not receiving a service at all and others were receiving scant attention, contrary to our expectations of what level of service should be delivered to people in a civilised society.
There is an absolute contradiction.
How does an organisation get onto a tendering list, whether it is an e-tendering list or a general tendering list?
Current procurement policy means that a lot of tenders are open. Organisations used to be on an approved providers list, which involved their having to jump through various hoops in relation to their legal and financial standing, their experience and so on. However, that is being phased out, and the new procurement process uses a compliance process to do part of the same work.
I do not want to put words into your mouth, but given that that is the situation, I wonder whether the committee can be confident that all those who provide services as a result of tendering for them are fit and proper organisations that have fit and proper systems and provide appropriate levels of care.
There are no nationally agreed parameters for that. The authority or department that constructs the tender sets its own parameters to define a fit and proper provider and it will have its own processes to determine the accuracy of the information that it receives. We are saying that that process is flawed, so I suppose the short answer to your question is, "Probably not."
If a care provider is changed as a result of whatever process is used, how is the transition managed? I realise that there could be 32 different answers to that, but in general, is care taken to ensure that the transition from one provider to another is as seamless as possible?
Providers do what they can to facilitate that, but it is not always easy. A big difficulty is the fact that the people involved are not included in the decision. Sometimes, they are not even aware that the support that they receive is being retendered and put back on the market. Some of our members have actually been instructed by the authority not to tell people that a change is taking place. The intention behind that is to reduce anxiety, but there are other ways to do that, and not telling people what is going on is not an especially effective way.
We would all like the users of the service to be able to input into the decision making, although I realise that that would be a big and complicated ask. Do you think that we can at least imagine that we might get to that stage?
I do. We have a sort of fantasy commissioning model—it has yet to appear in physical form. If there could be a competition involving an authority trying to select providers for personalised services and offering people choice, control, high quality and so on, that would be the gateway into the approved provider's framework. Individual service users and their families could even have their own contracts under the framework. That is where we are going when we talk about self-directed support. We are a very long way from that, though—that is why I call it a fantasy commissioning model.
A number of concerns have been mentioned. Thank you for your report, in which you clearly state at the start that
I know it well.
The petition made suggestions about various aspects of tendering, including the idea of five-year budgets. Would that be likely to have a positive or a negative effect? What particular changes could such an approach make regarding the salaries and conditions of people who provide the service?
I am probably the wrong person to ask about the benefits of tendering, given our position. It can have benefits where there is a poorly performing service. A process can be opened up that enables better-quality providers to come in and do something different and more supportive. Tendering can have some benefits for local authorities, which might want a more economic or efficient provider to come in, and which could make financial savings.
I wish to challenge a couple of points. You said that the benefits of the tendering process come where a service is performing poorly. I understand that, but is that the only reason why an authority might wish to retender at any time? Are there other reasons for doing that?
Yes. We raised that issue with the Public Petitions Committee.
Many adults require long-term care. It would be unfair to suggest to a local authority or other provider that care must be provided by the same people or organisations for the whole period. The ability to review the cost and quality of services must be built into the system.
That is true, which is why there must be performance review, contract monitoring and so on. I do not suggest that an authority should give an organisation a contract and then wander off and never trouble it again.
When I watched "Panorama", I was struck that, after the tender was awarded, nobody checked how the service was being delivered. Did that surprise you, too? In response to Patricia Ferguson, you said that providers say what they will do, but how they deliver services in practice might be different. Do your members comment on the evaluation and monitoring of services? Can the process be improved?
Every authority is different, although there is no doubt that intense financial scrutiny of performance is universal. As you said, scrutiny of quality can be less intense. I remember a discussion at the Health Committee in the previous session of the Parliament, when Duncan McNeil was a member of that committee. We were considering the work of the Scottish Commission for the Regulation of Care and we were concerned that some local authorities were almost duplicating the work of the care commission. A little bit of that still goes on in some authorities; in other local authorities monitoring is minimalist.
You mentioned a number of ways in which contracts should be monitored, none of which seems to have been used in the example that we are discussing. At the end of the day, the service user needs to be empowered to make complaints, which has not happened. How can we improve the process?
CCPS has done a lot of work with members on how to develop and finesse quality audit and assurance systems in organisations. We believe that the quality of the service is the provider's responsibility; the commissioner's responsibility is to figure out which providers will take the issue seriously. In our view, the procurement process does not do that adequately.
In recent years, when CCPS members have taken over service provision from councils as a result of a tender process in which they have won, has that resulted in a drop in the standards of care provided to clients?
The short answer is no. The contracts that our members win or lose tend not to be for in-house services, which have been exempted from retendering processes. Committee members may want to know that that is a cause of significant consternation to our members. Some of the services that our members are running have never been provided directly by local authorities. Learning disability and mental health services, in particular, were developed in the voluntary sector; local authorities now fund them because they have become mainstream services. Contracting out from local authority services relates mainly to residential care and some home care services for older people, where the private sector is dominant.
That is fairly satisfactory, particularly if it can be combined with producing a lower cost to the taxpayers.
To couch it in slightly different terms, some organisations do not have the capacity to deliver a certain level of quality within the terms of the contract that they are offered.
Therefore, those organisations are not fit and proper to meet the service specification that is laid down at the start of the tender process.
If you put me on the spot, I would say that that would be the answer. I would qualify that by saying that the fit and proper bit often relates to the parameters that authorities set in the PQQs, which are concerned with legal and financial standing and whether any of the directors of an organisation have been made bankrupt—that type of stuff.
In effect, those organisations should withdraw once they reach their bottom line in the tender process.
One would think so.
And your organisations always do so.
We have a number of organisations that will go so far and no further. Voluntary organisations in particular find it difficult when the service that is being retendered is one that the organisation has been delivering for the past 15 years. It will have a sense of obligation to the people whom it has been supporting, because the alternative is simply to abandon the support that it has been providing. The pressure to drop costs may therefore come not only from the local authority but from the organisation itself, which has been supporting certain individuals and families for many years and views that as its mission.
I think that it was suggested earlier that the in-house price is £20 an hour.
That is a minimum.
Indeed. What is the difference for the client between a £20-an-hour service and a £10-an-hour service? What specifically will the client lose out on?
I think that the "Panorama" programme may have given answers to that question. I will change it slightly and deal with the difference between a £20-an-hour service and a £15-an-hour service. We have evidence from the care commission that shows, arguably, that the quality of the services that the voluntary sector provides is higher than that of some in-house services. The interesting question is why in-house services cost so much compared with other services that are able to maintain good quality standards. However, that is a slightly different matter.
I want to return to the petition. You ask why in-house services cost so much. If your members can provide a better service for significantly less money, why do you want to sign up to a parity agreement that will push all your costs up and result in no better services being rendered at a higher cost?
If we are looking for parity, we have to ask why local authorities still continue to deliver so much themselves. That turns the question around. I think that I have said about parity that we are a long way from having exactly the same pay and conditions as local authority workers get, but we are diverging, and we need to consider up front how we can stop the disparity getting any worse. The parity argument is to do with bringing things back to somewhere reasonable.
As I understand the evidence, if you achieved the objective in full of closing the parity gap, not just narrowing it, which is the object of the petition that has been referred to us, there would basically be higher costs to the taxpayer with no higher standards of service. Your members might never win another contract because of the level playing field. The cost base would be levelled, and you might work your way out of jobs.
I do not think that I properly understood what you were saying before. We are not saying that we should get the same hourly rate for a service that a local authority should get. The parity issue is to do with pay and conditions for front-line support workers.
I see. When the petition refers to
That is the idea, but the difference between getting £20 an hour and getting £10 an hour is not all about the salaries of front-line workers.
I am referring to the petition that has been referred to us, which is specifically on wages and conditions. It calls on the Scottish Parliament
Yes, that would be the petition's ultimate goal, but—
Hang on. This is quite a serious issue, because earlier you suggested that equity does not mean absolute parity. Is that the case?
We are talking about equity in the rates of pay of front-line workers rather than equity in the hourly rate for the service, which includes a lot more than the cost of the pay and conditions of front-line workers—it includes overheads.
With respect, the petition is about the pay and conditions of workers.
Yes, it is.
Is it your objective that you want all your workers to be paid exactly the same hourly rate, and to have the same holiday and pension entitlements, as equivalent workers who are employed by councils? Is that your position?
That is the objective.
How serious an objective is it?
It would certainly make some voluntary sector services more expensive, but our view is that they would still be less expensive than comparable in-house rates, which involve overheads as well as staff costs. We have an issue with the £20-plus in-house rate for care services, a large proportion of which is accounted for by overheads. In a local authority, overheads tend to be hidden, but they cannot be hidden in a voluntary organisation because they have to be paid for. In a large local authority, some of the overheads will not necessarily be reflected appropriately in the hourly rate, so we are not comparing like with like.
Yes. We are familiar with such tendering process issues. Thank you.
We have just had a description of the negative effects of market forces. Why is it that those negative effects fall disproportionately on the voluntary sector in the delivery of services to our most vulnerable and on the low-paid workers in that sector? Why should that be?
I am not sure that I can answer that. As I said, we are finding that procurement policy is impacting on public services in general. Social care exists in a market, so it is inevitable that if certain procurement regulations and processes that are about driving down costs are brought in, that will be the consequence. That is what we are trying to stop.
Thanks very much for your time and your evidence. We will take a short break to set up for our next panel.
Meeting suspended.
On resuming—
I welcome the second panel of witnesses. From Glasgow City Council, we have Nick Kempe, who is head of strategic management, older people and physical disability; from social work resources at South Lanarkshire Council, we have Jim Wilson, who is head of older people's services, and Tom Barrie, who is head of performance and support services; and from the City of Edinburgh Council, we have Tricia Campbell, who is joint programme manager, older people, and Helen Morgan, who is joint programme manager, learning disability. Thank you all for your attendance.
When South Lanarkshire Council conducted its e-auction, that was consistent with what the regulations and the guidance were deemed to be at the time, but it was not consistent with what subsequent guidance suggested. When we examine the situation at the end of our existing tender, as we will have to do, we will take note of the guidance at that point in time and of a range of other factors, such as best practice, lessons that we have learned from the present tender and the outcome of the committee's inquiry.
Would anyone else like to respond?
The e-auction that we participated in a few years ago was part of a much wider tendering process, 70 per cent of which was about quality and 30 per cent of which was about cost.
So the City of Edinburgh Council will definitely not use it again.
Not for social care.
South Lanarkshire Council will not use it again.
I think that that would be unlikely. We would certainly look at the guidance and the regulations that pertained at the relevant time.
In Glasgow, we have never used e-auction.
And you are unlikely to, given what has happened.
We would not use it. It is important to distinguish e-auction from e-tender, because the determinant in an e-auction is price but standards are the key in our tender evaluations. Any tender evaluation of ours also has a financial component, but price is only a small part of that because other elements of finance, such as whether the right infrastructure is in place, are important in evaluating tenders. For example, unless we see costs and returns for training, we would not consider the tender to be financially sound.
It looks like the death of e-auctions for social care has been announced here this morning. We are all relieved about that.
I was intrigued by something that Tricia Campbell said—I am sorry to put her on the spot. She mentioned that one of the reasons why the City of Edinburgh Council would not use e-auction again was an inspection report. Were specific difficulties highlighted in that report?
I think that the difficulties that were highlighted concerned the unpopularity of the process with the people whom the Social Work Inspection Agency consulted during the inspection. I ask Helen Morgan to confirm that.
Yes, that was very much the case.
Were those people potential providers of services?
They were providers and service users.
That is helpful.
It was not stabilised into a single cost, because each provider had their own costs. However, the range was much narrower once we had contracted.
Have you found the quality to be similar, the same or better?
I examined that point before we came today and discussed it with a range of people. Our customer satisfaction surveys for the in-house and external services show that people are happier with the in-house service. However, the care commission gradings—to which Annie Gunner Logan referred—are higher for the tendered service for older people. There is no easy answer to your question; it depends on what methodology is used to measure quality.
That is interesting.
There were lots of providers before we went out to tender, but far fewer once we awarded the contract. Some of the existing providers who did not win the contract lost it because of quality, not because of cost.
That is helpful.
We are undertaking our first home care tender at the moment. The scoring balance for that is 60 per cent on quality and 40 per cent on finance. However, as I mentioned before, only a third of the finance marks are cost; the other two thirds are to do with having appropriate budget lines in place and showing appropriate accounting and financial mechanisms. Therefore, cost is only a small proportion of our evaluation. If all other things are equal and someone can provide the same service for a different cost, cost obviously becomes the crucial determinant, but it is only a small part of our formal scoring.
How do we measure quality? I am thinking of Tricia Campbell's example of the care commission saying that the voluntary sector is doing well but customers saying in the internal survey that they are happy with the in-house service. Different elements make up the quality of the service that is provided. Is there a standard for measuring it or do we all make up our own?
I can certainly comment on the tendering exercise. One myth is that people simply had to fill in a questionnaire, which was far from the case in our exercise. The PQQ issue that Annie Gunner Logan mentioned was certainly looked at, but when we reached the invitation to tender stage we put together a list of 20 documents and other pieces of supporting evidence that we were looking for from each of the companies. I will not go through the whole list, but it included the company's training plan, supervision and appraisal procedure, discipline procedure, medication procedure, adult protection procedure and so on.
How many companies reached the final tender stage?
Twenty-seven.
So 27 companies had to supply 20 documents each. It must have been some task to follow all that up. How many hours did that take you?
That massive task was dealt with by our contract section. I had toyed with the idea of bringing in the documentation for one company's submission—
How many people are in your contract section?
Five.
So for this single tender exercise, five full-time employees had to examine and follow up 20 documents from 27 companies and to provide an evaluation for every one of them.
Yes. I make the point to dispel the myth that the tendering exercise was simply a matter of sending in a questionnaire. That was far from the case.
Did your contract staff suspend their work in other areas to focus on the exercise?
It was obviously a priority and a major exercise for key staff at the time. Of course, we do not do that kind of work all the time.
You heard me mention to the director of CCPS the petition that has been submitted to Parliament, which has been referred to the committee. What would be the effect on your authorities if not only the five-year budget proposals but the petition's other elements were introduced?
If private sector or voluntary sector costs increased significantly, South Lanarkshire Council simply would not be able to afford the number of hours that it provides at the moment and would have to either cut the level of care provided or find the money from elsewhere in the system. In any case, it would be detrimental to part of the system, because we would have to prioritise how we spent our money.
As I have said, we have a £60 million budget for home care, only £2 million of which has been allocated to private and voluntary sector providers. We have never tendered for such services before because we put providers on a restricted standing list, which means that they have been approved for basic processes. Their rates vary between £9.30 and about £18, whereas our comprehensive rate for home care is £16.30. As a result, although the proposals in the petition would have an effect, it would not necessarily be enormous.
What is Edinburgh's view?
I do not quite understand your point, Mr Tolson. Are you talking about the five-year contracts in particular?
No; I merely wonder what the implications for Edinburgh would be if the proposals in the petition to which I referred came to fruition. Do you concur with the other local authorities' view that the main issue would be cost?
I think so. As 55 per cent of our care-at-home services are purchased, any increase in salaries would have a knock-on effect on contract prices.
It is helpful to hear that, as far as the elements that are set out in the petition are concerned, the local authority's main concern is cost. That brings us back to some issues that we touched on earlier. When I deliberately asked the director of CCPS about the benefits of the tendering process, I was told that one of them was to save money. If the various elements of the petition were enacted and the costs proved to be higher, would you simply retender or possibly even reconsider your decision not to use an e-bidding system?
I want to be clear: e-tendering is the electronic process of tendering, whereas e-auction is something completely different and, as I think I said earlier, it is very unlikely that we will pursue it again.
I want to continue on this point, because I am not sure that you understood what I am getting at. To be fair to you, I should try to explain.
Are you referring to the part of the petition that suggests that voluntary sector staff should have the same terms and conditions as local authority staff? Is that the crux of the question?
I am not speaking on behalf of the petition, but how can you create continuity of service and a reduced turnover by pushing down wages for front-line services? That links to what Mr Wilson was saying.
A high hourly rate does not necessarily equate to better pay for front-line workers. People assume that it does, but often it does not.
It is interesting to hear local government representatives arguing for a stronger role for the care commission in the regulation of services—that was not my experience when we were considering residential care. It is an interesting point, and I am sure that we will take it up.
I appreciate that, convener.
When Glasgow City Council is tendering, mainly for home care services, all providers must prepare a care proposal budget form that breaks down all the lines in the budget. That includes staff wages. Legally, in choosing a service provider, we are not allowed to make direct comments on wages or to allow wages to inform what goes on. However, if wages are very low, one of the things that we take into consideration—this is the importance of tying finance into standards—is how the provider deals with staff turnover and career development. If the provider has a flat management structure and there are no opportunities for learning development, it is reasonable to assume that it may have difficulty in retaining staff.
That would form part of whatever matrix you had—your scoring grid—for working out what would provide best value to the local authority.
Yes.
It would not be a comment on the individual hourly rate, but it would inform you, as part of an overall package, how likely the service provider was to retain, recruit and support its staff. What weighting is given to that in Glasgow City Council's matrix or scoring system?
As I said, the weighting is 40 per cent overall for finance, which is broken down into various bits. A third of the finance score concerns whether the provider has covered basic budget lines such as training and travel time; travel time is very important because, unless the provider allows its staff to travel between service users, the service will not work. We look for a range of budget lines.
Is that assessment part of the finance side of things, rather than part of the overall quality of care side of things?
Our finance staff who are involved in the scoring very much work together. To return to an earlier point, the scoring process is labour intensive. At the moment, we have 36 returns for one tender, and three people have been locked in a room for three weeks going through all the returns. One finance person is working closely with two commissioning officers. Our finance staff raise points for our commissioning staff and vice versa, to ensure that everything ties together.
Glasgow City Council looks at the hourly rate not in isolation, but in relation to other aspects. What about the other local authorities?
I echo what Nick Kempe has said. We are not formally allowed to use the hourly rate as a quality measure. However, if a provider's staff were to be paid the basic hourly rate, we would ask it how it could deliver a quality service for that price.
However, you accept that someone who earns £8.50 an hour is likely to be better qualified and more highly motivated than someone who earns £6.50 an hour, and who has poorer conditions of service and fewer opportunities for professional development. You could look at the raw data of the hourly rate not in isolation, but as part of a range of things.
I think that we could.
That would allow residents in Edinburgh to make a judgment call—whether fairly or unfairly—if they were to find out that care staff in Edinburgh were paid a pittance in comparison with care staff who worked for other local authorities.
Yes.
We, on South Lanarkshire Council, echo that position. As a result of the tender that we went out to, to demonstrate that we concentrated mainly on quality, the hourly rate went up. During the tender process, we did not look in great detail at the hourly rate that is paid to employees.
In the previous evidence session, we heard about South Lanarkshire Council's use of the e-auction process—various opinions were offered on the subject. Am I right in saying that £10 was where the clock stopped? What was the hourly rate that you arrived at?
The hourly rates that we ended up with range from £9.85 to £11.90. As I said, that compared with rates prior to our going out to tender of £9.60 to £19.20.
When you saw the figures, did you have any doubts whether they were unreasonable in any way?
They were consistent with the ballpark rates that were being paid across authorities. We all had experience of companies that had charged us much higher rates. The point that was made earlier was on the difficulty for us of determining the added value we were gaining from companies that we were paying much in excess of those figures. The range seemed reasonable to us.
The problem for us is that the rates did not seem reasonable to our previous witness. She described the rates as "silly" and, when asked whether they were respectable, she said that they were not. What is your response to that?
The starting rate was higher than we were at before the tender exercise. The rates are probably consistent with those that are paid across the country. They are not out of kilter—generally—with rates that are paid across the country.
Those of us outside the process are curious to know how, when the minimum wage is £5.70 an hour, you can get any service for £9 or £10 an hour. The rates may be consistent across the country, but how on earth can any service for anything be provided at that price? Over and above paying the minimum wage, how can overheads, management and training all be covered for £4? How is that possible?
Home care is very much a volume business. Obviously, companies with larger volumes of business spread their overheads. By moving from having 27 providers to having only six, we were looking to stabilise the market and give a smaller number of companies longer-term security of employment and, therefore, greater stability for their staff.
You referred to volume. As you alluded, the guidance is that e-auctions are not a very good idea in this regard. When you embarked on the e-auction process, did you see any floor for the tender price? Would you have been happy with a tender price of £8, or would doubts have entered your mind at £7.50 an hour?
Yes. Ahead of the tender exercise, we were conscious that there was a rate beyond which we would have said, "That is not practicable."
But you did not get there.
No. We did not have bids at that level.
Good afternoon. I am conscious of the reply to an earlier question from the convener that you would not seek to use e-auctioning again. However, I would like to take you back to the decision to use it. What was the reasoning behind using that system in the first place?
I have answered that in part. We were keen to reduce the number of companies and to introduce stability to the market. Our priority was quality, which was why in the exercise we gave a greater weighting to quality than to price. However, we were conscious of the need to deliver best value. Some things have changed as a result of the tender exercise. Previously, we were often charged more than half the hourly rate for half an hour of care, but in the tender exercise, we asked for the half-hourly rate to be half the hourly rate. Therefore, with the same money, additional hours have been provided for service users in South Lanarkshire—we now deliver an additional 2,000 hours of care. That was important for us.
What was the City of Edinburgh Council's situation?
One issue—which has been touched on—was the hugely divergent rates for care at home in Edinburgh when we went out to tender. I think that the hourly rate varied from £11 to £22. We wanted to achieve more consistency and a narrower band of hourly rates. Before the e-auction, many providers had been sifted out of the process through a pre-qualification questionnaire. Initially, 36 providers applied, but that reduced to 27. By the e-auction, we had 16. Providers were sifted out because they did not meet the quality standards; we carried out a quality ranking. After the e-auction, we carried out site verification. We went out to the care providers to check how the points on quality in their bids compared with what happened on the ground and to check the systems that were in place. That was a further check, once we had done the financial ranking of the bids.
I will return to checking. The City of Edinburgh Council and South Lanarkshire Council were the only local authorities that used this process. Were you aware at the time that you were the only two?
We were aware that the City of Edinburgh Council was the first authority to do so: we had already used the system for agency staffing.
We were aware of that, because we had worked with the City of Edinburgh Council and had seen how it carried out the e-auction part of the process, which related only to the price and came at the end of the e-tendering process.
I was careful to say that you were the only two councils that were involved in e-auctioning. E-tendering is different and therefore allows a different process. Through the e-auction, you drove down the initial bids. Did it occur to you that the companies would have to make savings if they reduced their initial bids? We are talking about a service, not goods or something tangible. Did that not make a difference?
It does not follow automatically that staff were being paid a higher rate by the companies that were charging us significantly higher rates.
It did not follow automatically that those companies would pay less as a result of reducing their bids but, from what we have seen, they clearly did. After the auction, the City of Edinburgh Council went out to examine quality, but it is clear from the "Panorama" programme that South Lanarkshire Council did not. How did the council ensure that, having driven down the bids, you could still deliver a service that was anywhere near the expected quality?
We think that what was shown on the programme was totally unacceptable. There is no question but that the standard of care for the two service users from South Lanarkshire was totally unacceptable. Ahead of the programme, we visited every service user who was getting a service from that company so that we could ascertain, on a range of measures, their views on the service. We went out again more recently and we will report the results back to our committee. It is fair to say that the views that we have had from the service users whom we have visited—approximately 700 visits—are, I am thankful, not reflective of what was shown in the television programme.
I hope that it is not the case that all the other service users were getting such treatment, but it is clear that some service users were treated appallingly. That was clearly a result of the way in which you tendered for services, which reduced costs to such a level that the service could not possibly be delivered. At what stage was South Lanarkshire Council going to wake up to that?
Our view is that what was shown in the programme was totally unacceptable. As I said, we have launched an internal inquiry into a range of matters, but I would not associate all of what was shown in the programme with cost.
I could ask a series of questions about how you monitor and evaluate your services, but I suspect that others will come on to that. I will ask a final question in relation to the submission that the committee received from Councillor Jim McGuigan of South Lanarkshire Council. Do you now accept that e-auctioning is not appropriate for delivery of social care services and that it was never intended for social care services but for completely different things, such as goods, and that councils—I include the City of Edinburgh Council—made a mistake in taking that approach?
Our understanding is that the guidance that was available to us at the time did not preclude e-auctioning's being used for delivery of care. We are clear that, after we had tendered, subsequent guidance came out that suggested that "extreme caution" should be exercised before the approach was considered for social care. We would accept that.
We would echo that. As I said, we will not use e-auction again for social care services.
So, was there no question that common sense told you that it was a risky way to manage the service? Unless it was written down in black and white in front of you that that was the case, you were going to go ahead and do it.
You must remember that, on the other side of the fence, we are charged with delivering best value. E-auction was a process that was being promoted at that time—without our having much experience—as a way to ensure best value. Given that we had ascertained that the main split in the tender was 60 per cent quality, 40 per cent price, we were comfortable at that time that we were meeting the two criteria. We were ensuring that the service user, who is the most important person in the process, was getting a quality service, and that we were getting best value as a council in providing that service.
I can assure you, Mr Barrie, that I understand completely the need to get value for the public pound, but I do not understand why somebody somewhere did not use a bit of common sense and say, "This is not the way to deliver home care services." Many people have seen clearly from the "Panorama" programme that it was not the way to do it. However, I appreciate that you have now learned that and I hope that we will see improvements.
I am not sure whether we are hearing a bit of contradiction. We heard in evidence this morning that cost savings were made, which was an objective, and claims that quality was unaffected; that more hours were made available; that front-line workers got an increase in salary; and that service users said that the service was fine. Why are you giving up on e-procurement if everything worked out fine?
The current wisdom is that e-auction is not an appropriate method to use for care.
But you are not apologising for it. Both parties involved have defended it on the basis that you have made cost savings, retained quality and whatever else you claim. That is a contradiction.
I can speak only for South Lanarkshire. We are now dealing with six companies as opposed to 27, as was the case previously. We believe that that has stabilised the market and that it will lead, and has led, to less staff turnover. Importantly, we are trying to give service users greater stability by reducing the number of people who visit their homes. For many older people, the carer is their sole contact with the outside world. They want the same person or small number of people coming into their homes. That is absolutely crucial.
Those same companies, or at least one of them, were skimming hours from vulnerable people. They were diddling the hours. They were not giving people more hours; they were giving them fewer. In the programme, they were giving them 10 or 13 minutes and running in and out of their homes. I do not know whether you have any facts and figures about continuity of service. Have you eliminated situations in which different carers turn up on different days? Three or four different carers can arrive at different times of the day or they can arrive at inappropriate times, such as arriving at seven o'clock at night to put people to bed. Have you eliminated all that? Was that a prime consideration?
I can comment on both parts of what you asked. On the reduced time that people were receiving, that matter has been passed to our audit section where it is being addressed, and it will be referred to our social work committee.
Have all the businesses that deliver the service for you been audited on whether they deliver the appropriate amount of time to your clients?
I am happy to move on to speak about monitoring arrangements if you wish, but the other question that you asked was about whether the situation had improved. I have recently received some of the feedback on the second stage of visits that we made to the company that was referred to in the programme. Comments from the service users have been that they have noticed a significant difference in past weeks.
I will follow on from the convener's questions. Mr Wilson has properly said that the standard of service given to service users, particularly those highlighted in "Panorama", was unacceptable and that is a welcome acknowledgement. However, the key issue is whether what was depicted in the programme is representative and whether the basic thesis of the programme, namely that quality was sacrificed for cost considerations, is true not just in relation to South Lanarkshire, but as a general proposition about the provision of such services by local authorities. My assessment of what has been said in evidence so far is that there is no correlation between quality and cost—that such a generalisation cannot be made. Is that a fair assessment of what you have all told us at different points this morning?
It is fair to say that we cannot make a direct correlation between quality and cost.
On the provider that was highlighted in the "Panorama" programme and its fitness to be awarded a contract, are you satisfied that that provider was—despite the specific failures in service provision—fit and proper, that its fitness for the job was properly evaluated and that it had appropriate experience for that level of care provision?
When we went out to tender, that company was an existing provider in South Lanarkshire. Not all the successful companies were from there—some came in from outwith South Lanarkshire. The company therefore provided services primarily in one geographic area. I was clear that I wanted detailed information from my managers in that area about the level of care that was provided by that company. Prior to the tender, I received very positive feedback about the level of care in that geographic area. In addition, between January 2006 and when the contract was awarded in October 2007, South Lanarkshire Council received no formal complaints about the company.
I want to broaden this out so that other panellists can comment from the perspective of their councils. A previous witness suggested that some organisations or commercial businesses who are permitted, or invited, to tender through e-tender, e-auction or a conventional tender auction are not fit and proper, and that their fitness is not properly evaluated before they are allowed to tender. Is that a fair criticism in respect of anybody whom your councils have allowed on to your tender lists?
I will answer of behalf of Glasgow City Council. A tender is a public process. We must advertise it and anyone is free to tender: we cannot prevent people from tendering. Our basic requirement is that anyone tendering for any service must be registered with the Scottish Commission for the Regulation of Care, which has primary responsibility for standards. If it thinks that a provider is not fit—reference was made earlier to duplication of what local authorities do—it will deregister it. Local authorities' starting point must therefore be that, if a provider is registered with the care commission, we allow it to tender and we evaluate whatever documentation it produces. We sometimes work with the care commission and share concerns about services, but the starting point for local authorities must be registration and who can tender. In addition, the local authority will have particular criteria for particular services and will assess how far providers that are registered with the care commission can meet those criteria. That is obviously part of our tender process.
The City of Edinburgh Council would echo that. Our assessment prior to undertaking the full tender takes into account care commission registration, the fitness of the company to operate and a range of other issues. As Nick Kempe said, anybody can apply, but we do rigorous checks on the fitness of the organisation before it can get through to the next stage.
If I understand it correctly, the award of the contract is not based wholly on price, because the quality and level of service provision is evaluated and an extensive service specification must be met.
That is correct.
We come back to the fundamental purpose of the inquiry. Regardless of whether auctions, e-tenders or traditional tenders are used, are the procurement processes that are in place at national level, through the care commission, and in local authorities, fit for the purpose of ensuring that those who require home services receive them from people who are fit and can provide services of the requisite quality? What is the evidence that that is not the case?
I have been responsible for a lot of tendering and know that it is a difficult process. We have commissioned care home services. People may return all the right documentation because they have hired a consultant who is good at doing that. As local authorities, we try to get practical evidence behind the tender documentation that is submitted. We must rely partly on what the regulator reports—to some extent, the information that we get is as good as what is in inspection reports. Everyone knows that the care commission has been involved in a developmental process, and reports have become better and more informative. However, we started work in a number of areas with an organisation that had just started out, which impacted on our ability to evaluate it.
Thank you for your honesty—that was a thoughtful contribution. Mr Wilson, I think you said that half of home care services in South Lanarkshire are provided in-house and half are contracted out. If I recall correctly, the relevant figures for Edinburgh were 35 per cent tendered out—
No, it is the other way round—about two thirds are tendered out and about a third are in-house.
I am sorry—I thought that I had noted the figures correctly. So, 65 per cent of services are tendered out and 35 per cent are in-house.
Approximately.
In South Lanarkshire, there is a 50/50 split. How would you assess the proportions in Glasgow?
For home care, £2 million of £60 million is contracted out.
So the figures are 4 per cent and 96 per cent. Given the different ratios that exist, is there any evidence, born of your experience, of a difference in quality and standard of service—from the perspective of service users—between the services that are provided in-house and those that you purchase, following the award of contracts?
We have asked all our council service users for feedback on that service, which has been positive. It would be wrong to suggest that the council service is always better than the service from other providers, because that depends on the service user's experience of the carer who goes into their home. None of us has a monopoly on good carers. A service user will talk about their carer in first-name terms—that is important for the service user.
The City of Edinburgh Council does not see purchased care services as being distinct and separate from the in-house service. The council is developing a model of care that is called home care reablement, under which everybody will have the in-house service for up to six weeks to allow them to become more independent and achieve their goals. Only after those six weeks will we do an assessment. We will still aim to deliver the most complex care in-house; the private and voluntary sectors will deliver less complex care. We are still developing that process. I suppose that is a bit tangential to the question.
Is that view instinctive or is it based on experience of poorer services?
I cannot answer that. All I can say is that the customer satisfaction survey shows that people prefer the in-house service.
Do people prefer that service in the abstract or are they saying that they have received a bad service elsewhere? Does your customer satisfaction survey ask about the service that has been given or about who people would—in theory—like to provide the service?
I understand that the survey is about the service that has been given, but I will have to check that.
It would be interesting for us to know the answer.
We have had a number of cases—not a huge number—in which the council could not pick up the whole care package at one time, so it was split between the council and another provider. In those cases, people have by and large asked the council to pick up the whole package as soon as it can.
Jim Wilson said that no formal complaints had been received about any company. How strong is that evidence? How frequently do elderly people and other people who are being supported in the community make formal complaints?
We all recognise that older people in particular are often reluctant to complain. That might be to do with their relationship with their home carer or with concern that they do not want to complain. That is why we have tried actively to ensure that we receive comments back. I referred to the visits that we have made, particularly in relation to the company that the "Panorama" programme was about. Council staff have twice had direct contact with everybody who has received that company's service.
I am trying to figure out how significant the evidence about the lack of complaints is, given that people are reluctant to complain—in the residential care sector, that is because they fear retribution or worsening care. Do we need to develop ways to engage with people who receive care, to obtain the information that we need to improve services? Should those who receive care not have some rights regarding whether services should be outsourced or changed dramatically, given your evidence about the importance of continuity of care? Indeed, they are the people who are involved person to person with the carer.
Obviously, when care managers and social workers visit people, they are constantly looking to see whether service users have any concerns about the quality of care that they receive. That is important. Although I can speak only for my organisation, I think that we all have a variety of mechanisms in place to encourage feedback on services. For example, in South Lanarkshire Council, we have a consultation exercise and we are involved with the South Lanarkshire Carers Network and with the better government for older people programme. Both those groups are involved in our joint services management group, as are other local groups. We try hard to ensure that people are represented and that we hear their views. We had a housebound survey because we were concerned that our feedback might be skewed if it came only from those who attend meetings. We try very hard to get comments back from people about the services that they receive.
Do other members of the panel want to mention any other innovation in getting people's views?
In the City of Edinburgh Council, we have considered having an electronic monitoring system, although we have not yet managed to develop that. The "Panorama" programme highlighted the fact that some carers did not give the service users the full time that they had been allocated. We could perhaps take up at national level how we might develop such a system so that, at the very least, we could know that the carer was in the house for the time that they were supposed to be there. One of the main complaints that we get is, "I didn't get my time. She came in for only 10 minutes." I should say that we get that complaint about our in-house services as well. For such groups of workers who cannot be directly supervised, it would be good if we could develop nationally a means of checking that they are where they should be at a given time.
The company that was highlighted in the "Panorama" programme is putting in a tracker system in South Lanarkshire.
Is South Lanarkshire Council helping the company to do that? Is the council meeting any of that cost?
No, the company will meet the costs, although the council is considering installing a similar system.
Given that South Lanarkshire Council delivers half of the services in-house, what systems does the council currently have in place to show that, for example, a carer did not turn up at someone's home this weekend or was two hours late in doing so?
We have a 24-hour call-centre service. Clients can contact us if a carer has not turned up, and we can make emergency arrangements for somebody else to go. All our carers carry mobile phones and we can direct a carer straight to the client's home.
We have had the figures thrown at us today of 54,000 hours and 2,000 additional hours of services being provided in half-hour or one-hour blocks. I want to know how many people are receiving services, on average, and how those services are being delivered. Do they get three half-hour blocks in a day, which gives them 10 and a half hours of care a week? Do they get more than that? Are assessments made to identify individuals with a higher level of needs?
I can give you some figures that may be helpful. South Lanarkshire Council provides the second highest number of care hours of any local authority in Scotland. Our average care package is about 14 hours a week, but the decision about what care is delivered is based on an assessment of need. Some people will need a relatively small amount of care. Their family may support them throughout the week, but there is one day when the family cannot do that and they need somebody to go in at tea time. Individual circumstances range from somebody receiving a small amount of care to people at the other end of the continuum receiving what we refer to as a seven-by-four package. That means that they are visited by somebody in home care four times a day, seven days a week.
We have approximately 8,000 users of home care at any one time, who receive a weekly average of 10 hours of care each. However, we have somewhat different systems from those that operate in other local authorities. There is a huge turnover among older people, and an area with one of the largest turnovers is that of hospital discharge. The committee will know that, although the guidance is changing, there is currently an entitlement to four weeks of free home care on discharge from hospital. In Glasgow, we have a system whereby the nursing staff in hospitals can order home care directly, which helps us to get people out of hospital quickly. If someone is ready for discharge, the nurse picks up the phone and our home care service is there within 24 hours to enable people who need home care to go straight home. We then have a review process. At least a fifth of our 8,000 service users are people who have been discharged from hospital with an entitlement to four weeks of home care, rather than even medium-term care packages.
Edinburgh has 4,664 clients, who receive 41,307 hours of care, so the intensity of service is lower than it is in South Lanarkshire. I would guess that the average is just under 10 hours a week, although included in those people are about 1,100 older people who receive more than 10 hours of home care a week.
My final question is directed to Mr Barrie and Mr Wilson. The "Panorama" programme stated that a neighbouring authority had been asked to comment on the services that Domiciliary Care delivered. I would not say that its response was wholly critical, but concerns were raised because it said that it was constantly monitoring the delivery of services by that company. Will you comment on that?
I agree that we must continue to strive to get feedback from older people, who by their nature are often reluctant to complain. I accept that.
Is there a mechanism for the exchange of information between local authorities when one of them expresses concern? I accept that there are various degrees of concern, but if there is a serious or very serious concern, does it go around the system so that other local authorities know about it? Would people know, through the care commission, for example, that you had concerns and were carrying out investigations? Would there be an exchange of information?
There is a variety of ways in which that might happen. Often, if there are concerns about a company that is providing services in neighbouring areas, contracts officers will exchange information. We would probably look to the care commission to provide information more formally. Through the Association of Directors of Social Work, committees share information about issues that are of concern to everyone. There are a number of levels at which information might be exchanged.
We have a memorandum of association on sharing information with the care commission, as do all local authorities. There is an agreement that we will tell the care commission about our concerns, and in turn the care commission will inform us about its concerns, in particular if there is an impact on service users.
Would a countrywide system be useful, for example in the procurement process, when you evaluate bids for the provision of services?
Yes. That would avoid duplication.
We receive audit reports and gradings from the care commission, which is helpful. We welcome the ability to get the care commission's evaluation in a number of areas.
Although there is probably no systematic approach to quality throughout the country, evaluation of care homes is much more robust than evaluation of home care agencies, perhaps because such agencies tend to be local or franchises of larger organisations. We could develop a more national approach.
Thank you all for your evidence, which has been valuable.
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Local Authority Audits 2008