Contracting out of children's services

The Education Secretary has pointed to a greater role for third party providers in children's social services. Olwen Dutton and Clare Taylor look at the key issues.

Local authorities' social care functions in relation to children have been in the spotlight recently, with child protection in some 20 local authorities judged as "inadequate" by Ofsted. The action the Government has taken in Doncaster, and threatened in Birmingham, has been very well publicised.

The Secretary of State, Michael Gove, has said that to date the Government has "not yet intervened vigorously enough" to protect the most vulnerable children and "we have not intervened to rescue those children who have been suffering the most in our society". His stated view is that more struggling children's services departments in England could be taken over by independent providers, and he is considering opening up well-performing departments to private and voluntary organisations so that they can innovate and improve their services. Until recently, this was very difficult to achieve, legally – but things have now changed.

Local authorities have for the last ten years been permitted by law to "contract out" most of their education functions, and the expansion of the academies programme and the Education Act 2011 have resulted in a dilution of their role in relation to the education of children and young people. But for a majority of local authorities, their social care functions in relation to children and young people have remained almost unaltered during this time.

Recent changes now give further scope to local authorities to deliver children's social care differently whilst still retaining their overarching statutory duties in relation to child protection and safeguarding. As local authorities are under increasing pressure to save money, opportunities to explore different ways to delivering service are often high on their agenda.  

Background

In 2006 the Green Paper Care Matters: Transforming the Lives of Children and Young People in Care proposed the idea of independent social work practices. The Green Paper highlighted concerns within the social work profession about poor outcomes for "looked after" children; in addition there was evidence from looked after children themselves of their dissatisfaction with the high turnover of social workers.

The Children and Young Persons Act 2008 provided for pilots to be set up to test this recommendation. This allowed certain local authorities to contract out certain of their social work functions in relation to children in care and care leavers to "social work practices" (SWPs) – independent social work organisations which provide services for looked after children and care leavers. The pilots were introduced to discover whether these smaller social work-led organisations, independent of local authorities, could improve the morale and retention of social workers by bringing decision making closer to front-line practice with the aim of delivering increased consistency and stability of care for looked after children and care leavers.

The Social Work Practice pilots

Five SWP pilots started up in England between December 2009 and May 2010. These independent organisations were commissioned by local authorities to provide services for looked after children and care leavers. The SWP pilots each differed substantially in their organisational forms and their origins and in the numbers and profiles of looked after children and young people they supported. In May 2012, three of the initial SWP pilots looked set to continue until at least 2013 when contracts for those outside the local authority come up for renewal. However, two of the initial SWP pilots had learnt that the local authorities would not be renewing their contracts and plans for returning these children and young people to the care of the local authorities were in place.

The evaluation of the initial SWP pilots resulted in mixed findings with stronger evidence in relation to some aspects of the pilots’ work than in others. Whilst there was some evidence of positive change for children, parents, carers and the workforce that could be attributed to the pilots, partnership working with the local authority was fundamental to the survival and achievements of the SWPs. The evaluation found that the SWPs who were most reliant on local authorities for a range of services, expertise and support proved the most viable. In the light of this, the evaluation concluded that it was difficult to see how SWPs would function if local authorities were to move all their children’s services out into SWPs. In such a scenario, some of the core functions and expertise of the local authorities essential for the success of SWPs would be lost.

A total of 20 local authorities have been authorised to commence a SWP pilot under Section 1 of the Children and Young Persons Act 2008 since 2009. It was only the initial cohort of five SWP pilots which were the subject of the published evaluation. As at May 2013 there were seven pilots operating in the following areas: Barnet; Blackburn with Darwen; Bristol; Kent; Norfolk; Redbridge; and Staffordshire.

At all times throughout the operation of the SWP pilots the local authorities maintained their corporate parenting role and legal duty to safeguard children and young people.

The sunset provisions

Section 1 of the 2008 Act allows local authorities to "enter into arrangements with a body corporate for the discharge by that body of some or all of the relevant care functions of that authority". The pilots operated on this basis. The Act contained "sunset provisions" which would make the Act void if not brought fully into force before 13 November 2013. At the eleventh hour, the Government issued the necessary legislation bringing Section 1 fully into force on 12 November 2013 in relation to all local authorities.

Registration of SWPs

It is a requirement of the 2008 Act that the SWPs are registered with Ofsted. Initially when contemplating bringing Section 1 into force in relation to all local authorities, the Government attempted to remove this requirement but this was rejected by the House of Lords.

SWPs will be registered with Ofsted under the Care Standards Act 2000 ("CSA"), but inspection will fall under their delegated function from the local authority and therefore will be carried out under the Education and Inspections Act 2006 ("E&IA"). The legislation is underpinned by regulations that set out:

• a fitness test, which covers registration of the responsible person, the registered manager and the necessary experience and qualifications of the staff.
• Ofsted’s powers of cancellation.

Ofsted has powers to inspect the exercise of local authority functions under s.136 of the E&IA. These powers extend to the inspection of any functions that a local authority delegates to an SWP.

All new providers and managers of SWPs must make an application to be registered with Ofsted under the CSA. Existing pilots where functions are already delegated will automatically become registered with Ofsted from 12 November 2013.

As potential providers of social work services must by law be registered before they can have local authority statutory functions delegated to them, such providers must be in possession of their registration certificate before entering into a contract to provide social work services. At the point of Ofsted publishing their guidance on registration, it is not clear whether local authorities will only tender with providers already registered with Ofsted, or whether registration on successful tendering will be acceptable. Potential providers of social work services will need to be aware of Ofsted timescales for registration, and liaise with the local authority they propose to contract with. Local authorities would be wise to have a clear policy regarding their requirements for registration before embarking on any tender process.

Impact of Section 1

Critics fear that this enactment will lead to a privatisation of social work and that local authorities are "in effect … selling off parental responsibility to private or voluntary sector providers". Some experts do not believe that the evidence gathered from the evaluation provided a sufficiently strong case to extend the legislation to all local authorities.

The DfE have stated that they are not anticipating "large scale moves towards the delegation of local authority functions and associated registration immediately, but are confident that a number of local authorities and providers will wish to take advantage of the new flexibilities in the first year. Others might be expected to follow suit in future years if these approaches yield the benefits anticipated".

The DfE have further commented that the level of public interest in this policy is relatively low, with the two consultations on registration and the detailed regulations attracting fewer than 25 responses.

Conclusion

This legislation does not affect the DfE's continuing right under the Education Act 1996 to issue directions and intervene in relation to failing authorities, but may provide different options to the DfE when faced with this situation. However, while the legislation might make things easier from the legal point of view, it doesn't affect the significant practicalities. As the figures above show, there is unlikely to be a rush of private sector providers anxious to take up the opportunities in authorities where Children's Services have been judged to have problems. Running Children's Services is far from easy, and the stakes are very high, especially where the particular service has been judged to have deep seated problems. Only time will tell whether or not the private sector judges that the rewards will outweigh the risks.

Olwen Dutton is a partner and Clare Taylor is an Associate at Bevan Brittan. Olwen can be contacted on 0870 194 5006 or by This email address is being protected from spambots. You need JavaScript enabled to view it., while Clare can be reached on 0870 194 5413 or by This email address is being protected from spambots. You need JavaScript enabled to view it..