Commissioning and Procurement
In recent years central government has emphasised the need for public service reform by identifying improvements in the commissioning (*buying in*) of services. Increasingly government agencies are encouraging the greater use of voluntary and community organisations in the delivery of public services as it is thought that the voluntary and community sector has the potential to deliver some services more effectively than other public of private sector providers.
Recent research has identified that grant funding for the voluntary and community sector, particularly smaller organisations, has decreased and that this has also led to the shift from grant funding to commissioning of services. It is vital that the voluntary and community sector are kept up to date about the changes so that informed decisions can be made about which funding route (grant / commissioning) should be taken. Contracts with public sector bodies should enable voluntary and community organisations to generate funding which can be used to fund activities and/or contribute to the development of reserves. However, these same organisations may find themselves competing for the funding that they may have been receiving for many years.
These web pages will help you identify if going down the commissioning and procurement route is right for your organisation, whilst also providing some useful resources and contacts, should you choose to do so.
What is Commissioning?
Commissioning is the 'how' - where public sector bodies decide what services they require to meet their priorities. The Audit Commission defines commissioning as "the process of specifying, securing and monitoring services to meet people's needs at a strategic level" [Social Services Inspectorate / Audit Commission (2003) Making Ends Meet], thereby emphasising the importance of commissioning as being needs led.
Commissioning involves:
- Assessment (or reassessment) of need
- Identification of resources
- Planning how to use the resources
- Arranging service delivery through a procurement process
- Monitoring and reviewing service delivery
The following LVSC diagram is a good example of a Commissioning Cycle depicting this process:
For additional detail please follow this link - Strategic Commissioning Cycle GLE
What is Procurement
Procurement is the 'do' - the actual purchasing of a service provided by a charity, social enterprise, business or public agent. This involves a 'tendering' process and is implementing around commissioning requirements.
Procurement involves:
- Purchasing - the process of securing or buying the services: and
- Contracting - the means by which the process is made legally binding
The Tendering Process
All voluntary and community organisations will need to be prepared to make sure that they meet the required standards in order to compete for funding to deliver public services. Contracts are awarded against a scoring system and many orgnaisations could find they are competing to deliver a lcoal service with service providers in other regions and sectors. Partnership working may also be necouraged as large contracts (as opposed to several smaller contracts) are seen as a cost-effective way of delivering publics services.
There are three different tendering procedures - open, restricted and negotiated.
- Open - this is when a contract is advertised, with responing organisations being sent the full tender documentation, which may include the following:
- Letter of invitation (when and where tenders should be submitted)
- Tender document (tendering instructions)
- Specification (standards that will be scored during evaluation)
- Pricing document
- Contract conditions
- Quality requirements / methods statement questions
- Tender evaluation model (how the tender will be evaluated and contract awarded)
- Questionnaire (to assess financial standing and commitment to equal opportunities and environment issues)
- Restricted - responding organisations to an advert will need to complete a questionnaire (PQQ) to assess their suitability to tender for the contract. If they pass this stage they will be sent the full tender documentation (as above). the following information could be requested in the PQQ.
- Name, address and registration number
- Finacial details
- Equal Opportunities policy
- Environmental policy
- Health and Safety compliance/policy
- Relevant experience
- Capacity
- Workload and capacity
- Negotiated - used in exceptional circumstances, such as where the nature of the service is such that the specification for the service to be delivered cannot be established: importance is placed on the quality, governance systems, financial viability and risk management of tendering organisations.
The timetable to prepare a tender application can often be extremely tight, therefore we recommend that you prepare a number of documents in advance. Please click here for further details.
Latest update
NAVCA named as a delivery partner for IDeA National Programme for Third Sector Commissioning
IDeA has been awarded the contract for the second phase of the National Programme for Third Sector Commissioning by the Office of the Third Sector (OTS) and they have recruited third sector partners, including NAVCA, to help deliver the programme.
The programme runs until March 2011 and will improve the contribution of third sector organisations to the design and delivery of public services. The programme will also develop the commissioning skills and bidding capacity of third sector organisations.
As a delivery partner NAVCA, through its members, will provide direct support with tenders to 150 organisations who are new to bidding or have been unsuccessful in bidding for contracts in the past. NAVCA will also capture the learning from this work and make it more widely available, benefiting other third sector organisations.
Pauline Kimantas, NAVCA's Local Commissioning and Procurement Manager, said
"Third sector organisations want to be more involved in the design and delivery of public services but there is not a level playing field. We are delighted to be part of a programme to create fairer commissioning processes."NAVCA will specifically be working with our members to assist local third sector organisations who are either new to bidding or have been unsuccessful in the past. We will help them get over some of the hurdles third sector organisations face and use what we learn to improve commissioning processes for all local groups."
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