9 CONCLUSIONS
228. A striking finding of our inquiry has been that,
while some of the statements both supporting and opposing the
expansion of third sector provision have verged on the hyperbolic,
the evidence around the benefits and risks remains for the most
part speculative or anecdotal. In part, this is simply because
many services have only recently been contracted out to the sector.
Nonetheless, there is a clear onus on the Government, as the proponent
of greater involvement of the third sector in service delivery,
to make the case on a more empirically demonstrable basis. We
hope that an inquiry onto this subject a few years from now would
be able to draw on a solid base of evidence which might allow
firmer conclusions on what works and in what circumstances.
229. While the scale of third sector involvement
in service delivery remains close to its current small-scale level,
many of the risks to the sector which were identified in our inquiry
appear to us to have been overplayed. There clearly would
be risks if the Government were to go significantly further down
the road of procuring services from third sector organisations
under contract, especially if that were at the direct expense
of grant funding for the sector's other important functions. However,
for now at least, grant funding continues to be a very significant
element of the funding mix for third sector organisations, and
their ability to campaign and speak out does not seem to be obviously
affected. Indeed, most risks to the sector appear to have been
equally applicable in a grant funding environment. Moreover, there
is an apparatus in place to protect the distinctive characteristics
of the sector and hence protect the citizen, in the form of the
Compact and its enforcer.
230. The risks to government and to the service
user may be more significant. Most of these are also not sector-specific,
and are better seen as general risks of contracting out public
service delivery. There is a particular issue around accountability,
where action needs to be taken regarding the application of users'
rights under the Human Rights Act and the Freedom of Information
Act; and clarity is also needed around who service users can complain
to when they have concerns about the service they have received.
Beyond this, all commissioners face a significant challenge in
effectively monitoring service provision while preventing unnecessary
costs and bureaucracy. It is by no means proven that the benefits
of contracting out services to providers from any sector outweigh
the costs of effectively monitoring performance. Only the last
of these risks, however, is potentially a show-stopper. The risks
around accountability, while significant, could be mitigated by
changes to the law. If the Government commits to tackling those
issues, therefore, we see no reason not to continue cautiously
along the path of encouraging third sector provision of public
services.
231. Caution is needed because progress must be
on the basis of trialling in certain areas, through better use
of commissioners' legitimate discretions, towards the collection
of an evidence base. We do not want to see a mass transfer of
services without significantly stronger evidence that this would
be beneficial, and we are heartened that the Government does not
appear to support such a mass transfer. Ultimately, it must be
right to judge all prospective service providers on their merits.
To do that, we need a vigorous mixed economy of provision, capable
of eliciting the various distinctive strengths of different organisations
in different sectors.
232. However, the idea that there will ever be
a level playing field where providers of every variety compete
on an equal basis is unrealistic. There should certainly be no
unnecessary barriers to particular providers competing for contracts,
but there will always be significant disparities between third
sector organisations and counterparts in other sectors, not least
in financial terms. While intelligent commissioning might mean
more decisions could be made on factors beyond cost of service
provision, cost will rightly always remain a factor for commissioners.
233. With all those caveats, though, we believe
that intelligent commissioning offers scope to involve the third
sector more. The key to getting the best out of the sector will
be fostering an understanding of the sector's strengths among
commissioners, who are central to determining the shape of public
services. A culture change is needed to encourage the best people
to become commissioners, with the right training and experience
in place to ensure that they get the right mix of skills and specialist
knowledge. That culture change should lead to the decline of perverse
practices like overly short-term contracting. It should lead to
an understanding of the importance of designing service specifications
appropriately, engaging with users and possible providers to consider
the outcomes which might be delivered for service users. It is
at this crucial design stage where commissioners can design the
playing field to play to the distinctive strengths of certain
organisations, by determining the nature of the outcomes being
bought, the scale of the contracts through which they buy them,
or any wider social benefits that ought also to be delivered.
In short, intelligent commissioners have a great deal of scope
to involve third sector organisations more by wise use of their
legitimate client discretions. If that happens, and those organisations
are given the freedom to be distinctive, we believe there may
well be potential in some areas for genuinely improved outcomes
for the public.
|
