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Pinning down social impact

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This month’s first post-election Budget will be eagerly digested by local authority officers, even if the financial pain councils can expect over the next five years is only likely to become clear in this autumn’s comprehensive spending review.

Participants

Sarita Adams, managing consultant, Baker Tilly

Paul Brown, chief executive, Greenwich Primary Care Collaborative CIC and consulting partner, Baker Tilly

Dave Burton, programme director for liaison and diversion, NHS England

Keith Cooper, acting editor, LGC (chair)

Jessica Crowe, executive head of customers, commissioning and governance, Sutton LBC

Kirsten van den Hout, senior associate, Social Business International

Matthew Humphrey, partner and national lead for local government, Baker Tilly

Peter Moore, head of commissioning and partnerships, Sefton MBC

Paul Stock, chief executive, Office of the Police & Crime Commissioner for Leicestershire

Keith Ward, head of social impact advisory, Baker Tilly

Rob Whiteman, chief executive, Cipfa

Dave Burton

Dave Burton

What is already very clear, however, is that councils will have to continue to ensure that what resources they do have on the ground, whether actual cash or services, their influence via commissioning or through their leader-of-place role, are delivering the maximum impact for their communities. Part of this, of
course, will be about continuing to interrogate and strip out costs wherever possible and ensuring all procurement and commissioning activities are delivering real, sustained (and measurable) value for money. But the other side of the coin, and potentially more challenging, is a growing imperative for
councils to be measuring and evaluating the social return, the social impact, of their commissioning and procurement decisions.

Since 2013, under the Public Services (Social Value) Act, all public bodies in England and Wales have been required to consider ‘social impact’ within commissioning and procurement; how the services they commission and procure might improve their community’s economic, social and environmental wellbeing.

But measuring and showing evidence that a particular approach is actually working in terms of social impact is not easy. How do councils capture social value and make sense of it? How do councils build and embed it into a challenging financial and commissioning environment? Moreover, how can they do all this in the context of an increasingly collaborative multi-agency and multi-budget operating environment?

Jessica Crowe

Jessica Crowe

To consider these challenging questions LGC, in association with Baker Tilly, brought together in June a high-level panel for a roundtable debate. The panel comprised a deliberately broad field of experts, encompassing local authority, NHS and primary care, police and social enterprise perspectives. One reason for this, as acting LGC editor and discussion chair Keith Cooper said, was that social impact is widely seen as something of a “slippery” issue. He asked what local authorities could learn from their peers and vice versa. More widely, he asked, how did panellists feel the public sector could best demonstrate the social impact or value of its commissioning, and what were the challenges of doing this?

“For me, one of the first things is actually getting an understanding of what we mean by [social impact within commissioning],” said Paul Stock, chief executive of the Office of the Police & Crime Commissioner for Leicestershire. “Before we go out publicly and talk about that, there needs to be a
common language about what it means. That’s something I’m experiencing at the moment; that when we come together to collaborate as partners we all have slightly different understandings of what it is we’re trying to achieve.”

Keith Ward

Keith Ward

“There is a continuum of what people mean by commissioning,” said Rob Whiteman, chief executive of the Chartered Institute of Public Finance & Accountancy. “Sometimes [councils] just mean straight procurement. At the other end, commissioning is an assessment of where a community is going for the next 20 years, how its demography is changing, what sort of services it will need and if there is a market to provide those services - and if there isn’t, how do we make a market and develop it? We’ve got to help commissioning move along the continuum to get to that end, because actually anyone can measure the value of a contract.”

Moving along this ‘commissioning continuum’ was precisely the challenge facing Sefton MBC, said Peter Moore, the council’s head of commissioning and
partnerships. “One of things for us around social impact or social value is the kind of legal placement of it at the procurement end. “We need to drive that so
that when we’re creating those markets we’re thinking about how the social value is built into them. It’s perhaps by encouraging the development of social
enterprises and those sorts of organisations as part of that vibrant and mixed market.”

“At a micro level, at a contract level, commissioners should be looking at the social value individual organisations put back into the community. That would encourage social enterprise to grow,” said Paul Brown, chief executive of the Greenwich Primary Care Collaborative CIC and a partner with Baker Tilly.

Kirsten van den Hout

Kirsten van den Hout

“Within the social enterprise sector, there is a need for help in that first step on the ladder. Our experience of getting an organisation from zero to something, it is immensely difficult. The system doesn’t help and there’s no cash, there’s no capital support.”

Kirsten van den Hout, senior associate at Social Business International, said it would be interesting to find out what were commissioner’s experiences
of working with social enterprises. “What I’ve heard so far is that it’s [seen as] a task, it’s a job; it’s a difficult one for commissioners to understand what outcomes they might need and how they think about short term, medium term and long term. But there is a role for social enterprises in there, to work with you right at the beginning, to help you to codify what happens, to look at the social enterprise system as it is rooted in the community, and to perhaps have an idea of the problems as well as you, and to work together.”

Sarita Adams

Sarita Adams

“It’s getting people to see it as a whole cycle; there are different bits of it, and people only see their bit,” said Jessica Crowe, executive head of customers, commissioning and governance at Sutton LBC. “Procurement only get involved when somebody realises, ‘oh god, my contract’s coming to an end’. They haven’t started 18 months before to think: what are the needs of the community that we’re trying to meet? How do we want to deliver? Do we even need to
deliver this service or could we do it in a different way?”

“One of the challenges is the procurement framework,” said Keith Ward, head of social impact advisory at Baker Tilly. “If Jessica procures me to supply a whole load of pens, say, we’re got an economic transaction and that’s straightforward and easy to capture. If you then procure me to use these pens to teach Rob how to read and write, then suddenly we are going into this social area. How do we start to measure that?”

Social impact or social value was often thought of as a ‘nice-to-have’ by commissioners, said Sarita Adams, managing consultant at Baker Tilly. “We’re yet to have a consistent way of saying, ‘if we do that, legitimately you’d expect to see x as a by-product of doing y’. To then be able to measure that by-product is something we’re not very good at articulating at the outset.”

The NHS also had a long way to go along Mr Whiteman’s commissioning continuum, said Dave Burton, programme director for liaison and diversion at NHS England. “One of the things that worries commissioners is that, following the Health and Social Care Act 2012 and the regulations around competition within the NHS, we’re moving into a world of contestability for health services that previously didn’t really exist. But local government has got 30-40 years of experience of doing this and we’ve got a lot to learn from other public sector commissioners,” he said.

“It is about upping our skills in terms of specifying what we want back in return for the money, so that we don’t just end up with simplistic transactional
relationships. It’s about building that richness, that sophisticated relationship, with your supplier market.”

Mr Cooper asked if there were tools that could help in this.

Paul Brown

Paul Brown

Mr Whiteman pointed to Cipfa’s Aligning Local Public Services (ALPS) framework. “Very often when public services come together just getting past stepone - deciding how much money are we spending in an area - is difficult. We’ve pulled together a panel from across all public services and we’ve got this tool that can help areas can get past stage one,” he said.

“The next step is to say, when people are investing in upstream activity and they want to get social impact, how will they measure that and is there a way of
measuring that where any organisation can say, ‘we put some of our money towards that but we could see this amount of benefit’? So we’re now starting a piece of work with Public Health England on how we can create a way of measuring upstream activity and its benefit downstream.”

Other panellists highlighted the European Commission’s GECES standard. This, said Mr Ward, “looks at inputs, it looks at activities, and then goes on to
outputs and outcomes”.

“It then prescribes a way of mapping that and, once you’ve told the tale, only then do you start to evaluate it,” he added. “So it is very much about getting the understanding of the project and looking at that before you commission.”

Paul Stock

Paul Stock

The debate then roamed around topics such as the role and use of ‘big data’, the importance of being able to scale up innovation and the need for ‘whole life’ commissioning arrangements. There was an acknowledgement that social impact measurement is subjective, given that it involves looking at the difference made to people’s lives. The panellists said public bodies must make and disclose assumptions when looking at social impact in order to measure that difference.

As the discussion drew to a close, Mr Cooper asked what panellists would take away from the debate.

“If you’re not aware of the social impact of what you’re creating, you are decisionmaking in a vacuum,” said Mr Ward. “You could easily be making completely the wrong decisions that have both a personal and a cost implication. From a scrutiny point of view, if you’re not fully measuring the social impact of what you’re creating then you’re not being accountable. So, regardless of commissioning, organisations have to capture that social impact.”

We could in time see “a massive shift” in provision to social enterprise, said Mr Whiteman, but that wouldn’t necessarily mean outsourcing as we know it
other;you could ask your outsourcers what they are doing around corporate social responsibility in order to help social enterprises flourish in your local area,” he said.

Peter Moore

Peter Moore

There was also an important role, as commissioners, for greater follow-up with service users, said Mr Burton. “We encourage our providers to give usexamples of how they’ve engaged with their local populations or target audiences to say how well they’ve done but how often do we do the other step,
which is asking ‘are we commissioning the right things for you?’”

To that end, Mr Moore highlighted how involving a wide range of stakeholders, including social enterprises, clinical commissioning groups, GPs and service
users, had helped to improve substance misuse treatment services within his borough. “We had a series of events where we tested out our understanding of the data and the narrative and what service users were telling us where they thought we needed to go, and there were workshops around that. That resulted in a more recovery focused, integrated, all substance misuse treatment service.”

“Commissioning is just a means to an end,” said Ms Crowe. “The important bit is thinking about what you’re trying to achieve, and there might be different ways of trying to achieve it. “For example, across a range of different services we have a massive agency spend. Spend on agency has been seen as the ‘big baddie’ and the question that is always asked is ‘what are you spending on agency staff or consultants?’ but some people want to work like that, they want the flexibility. So, why do we not have our own agency? Could we not offer the same benefits to those employees to work in a different way, but
we could make money out of it as an authority?”

Rob Whiteman

Rob Whiteman

“There is the risk that you make the savings from the things you can cut, rather than the things that are best cut,” warned Mr Whiteman. “I do worry for the longer term that some of the taps that have been switched off - cuts in youth services, cuts in handyman services and so on. [Those are] things that actually can easily be stopped because it’s a way of saving money, [but] actually we don’t know what the unintended consequence of that will be in five years’ time.”

Please start measuring your social impact: Because you can and you should

Matthew Humphrey

Matthew Humphrey

The measurement of social value provides our public services with the ability to clearly demonstrate the beneficial impact that they can have on communities and society, far beyond the standard pound input v pound output efficiency measure we have become hooked on. Pair this up with a collaborative commissioning approach involving multiagencies with clearly defined outcomes in the short, medium and longer term and you would be looking at transforming these communities for good. Few would disagree that the social value agenda is worth pursuing.

System wide transformation of this nature, however, presents challenges for the reliability, access and sharing of data. Also for the agreement of expected outcomes coupled with age old sovereignty issues, addressing public service language barriers, agreeing common (and valid) measurement criteria (in particular social impact) and the need to change our longstanding risk management approach, shifting from “no we can’t” to “how can we do that?” Not forgetting of course the need for traction on the ground - right people, right place, right time. A sure fire certainty is the day of the social entrepreneur is yet to come in this respect!

In our experience social enterprises are much more tuned into this way of thinking, working collaboratively with commissioners and providers alike, looking to always leverage more value in the pound to achieve a greater social impact and achieve a sustainable improvement to the communities they serve. To deliver this lasting change these growing social enterprises need to have strong commercial skills. Maybe this illustrates the heightened commercial
awareness now needed in the public sector?

The public services (social value) act was a step in the right direction. But so far this has not delivered the benefits for all parties, probably because it was made a “must do” rather than a “must have”. The result, for some, is a dull procurement tick box (or should I say copy and paste between submissions) and anyway who would know what a good response would look like anyway? Without greater qualification of what social value returns are forecast,
commissioners will only ever manage to tinker at the edges.

So now is the time to build more “value” methodology within public service commissioning and providing and forge a sustainable legacy of social value….and what if we don’t then we can always take comfort in the fact that the major outsource provider we appointed will always clear the local pond.

Matt Humphrey - 07764 688248
Column sponsored and supplied by Baker Tilly

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