4 The Community Right to Challenge |
43. The Community Right to Challenge empowers voluntary
and community groups, parish councils and employees of local authorities
to express an interest in taking over a local authority service:
· the expression of interest (EOI) must
explain how the proposal will meet the needs of those who will
use the service, and show that the group is suitable to run it;
· the local authority must either accept
(with or without modification) or reject the expression of interest;
· if the proposal is accepted, a normal
tendering process must take place and other bodies, including
private sector organisations, will be permitted to bid.
Evidence of awareness and use
44. According to a survey conducted by Locality,
which provides support to groups interested in the Community Rights,
awareness of the Right to Challenge "appears to be high amongst
relevant bodies [
] The vast majority felt they either knew
fully (42%) or mostly (38%) how the legislation works".
DCLG does not formally monitor uptake of the Community Right to
Challenge or require local authorities to report the number of
challenges, but some 216 groups have received financial assistance
to develop their capacity to bid.
And DCLG has informally collated responses from follow-up surveys
of users of its support programme and other sources which show
50 EOIs as of December 2014. Seven have been accepted and three
It is unclear whether the 216 groups provided with financial assistance
have taken their proposals any further. The fate of the other
EOIs is also unclear, including, if they have been unsuccessful,
the reasons why. We were told by SIB that take-up of the Right
"should not necessarily be the measure of success" by
DCLG; the objective had not been to "force community groups
to exercise the Right to Challenge if that was not appropriate
for the relationship they had with the local authority".
45. Evidence suggested three reasons why community
groups were not submitting EOIs or going through the Right to
Challenge procurement process. First, groups have used the Right
more productively as a negotiating tactic, in preference to submitting
an official EOI.
Tony Armstrong, from Locality, said the Right "has either
deliberately led to a conversation or the local authority's behaviour
has changed as a result, which is a very positive move".
Second, but less positively, some groups felt the Right was adversarial.
The National Association for Voluntary and Community Action (NAVCA)
called it the "nuclear option": once used the group
mounting the challenge could not go back as relations with the
local authority were likely to be "severely damaged".
Third, the challenge process itself was a cause for concern. The
Plunkett Foundation told us, "the carrot (potential community
involvement in service delivery) does not outweigh the stick as
the challenge triggers a contracting procedure that anyone can
bid for, and the community has no protected period to bid unlike
with the Community Right to Bid."
Community organisations in Cornwall who used it found the Right
to be an "overly bureaucratic process". They had to
commit "substantial resources" to the EOIs and procurement
46. Community groups have not taken up the Community
Right to Challenge in significant numbers. This may not necessarily
mean the Right is not fit for purpose, as in certain cases it
may have prompted communities and local authorities to enter into
constructive discussions and working arrangements that, prior
to the Right's introduction, might not have occurred. It is unclear
what has happened to those groups that have received financial
assistance, and to the majority of those that made expressions
of interest (EOI). An analysis of what stage they have reached,
including whether the EOIs have been successful and if not, why
not, would no doubt be useful in helping to understand the effectiveness
of the Right. Other groups have been put off using the Right in
the first place, however, because of its adversarial connotations
or because of the resultant procurement process, which can pit
community groups against larger, more established service providers.
We recommend that the Government find out what has happened
to groups receiving capacity-building assistance and to those
that have made EOIs under the Right to Challenge process.
How the right might be reformed
47. Witnesses suggested a number of ways to make
the challenge process more favourable to community groups. First,
Social Investment Business (SIB) said more community groups might
use the Right if the perception that it was confrontational was
that end Barney Mynott, from NAVCA, said the name Right to Challenge
"could be changed", as "the idea of [a] challenge
does not suit the times".
The Minister, Stephen Williams MP, accepted that the language
of the Right might not lead a council to want to collaborate with
the challenging body, and said the Government would "undoubtedly"
review this in 2015.
Locality proposed renaming it as the "right to reshape services",
and added that this should give communities greater power over
the design as well as the delivery of local services.
On this point, however, the Minister said he hoped a good local
authority would collaborate with its citizens anyway and not need
the Government to tell it do so.
48. Second, on the challenge process itself and the
idea of a protected period in which to bid, Seb Elsworth, from
SIB, said it was complicated for groups that have never run a
local service to understand the procurement and bidding processes
and regulations, and more time would help them to do so.
Third, on the challenge process and the idea of reforming procurement
criteria, Barney Mynott cited new EU procurement legislation,
which enables commissioners of services to reserve certain contracts
for public sector spinouts, mutuals and not-for-profit organisations.
He said this might be brought within the Right to Challenge.
Cornwall Council cited a "more positive and practical"
Request for Quote (RFQ) model, adding that a Right to Challenge
using the RFQ model would be exempt from the full rigour of an
EU procurement exercise and "mean Cornish community organisations
delivering valued services to the people of Cornwall".
49. Witnesses pointed to a need to reform procurement
practice in general, however. Local commissioners' skills in engaging
with community groups needed to be improved;
there needed to be a presumption that contracts could be tendered
locally and on a small scale;
and more focus was required on community and service user involvement
in the planning and evaluation phases of commissioning.
In our report on Local Government Procurement, we urged the Government
to consider extending the provisions of the Public Services (Social
Value) Act 2012 so that local authorities have to consider the
potential for a contract of any value to deliver social benefits.
This might allow community groups to bid for contracts more competitively.
50. The adversarial elements of this Right could
be diluted if it were rebadged as something other than a Right
to Challenge, though without the removal of the right to
trigger a tendering exercise for local services. We are not convinced
that communities require a formal right to design services. This
should happen as a result of a community group's discussions with
its local authority or, if this is ineffective, as a result of
raising the prospect of expressing an interest in tendering for
a service. Recourse to the Right should not be the first step.
Instead, local authority procurement processes need to change.
Specifically, commissioning services need to involve the community
more as a matter of routine. An extension of the Social Value
Act might allow for this. Certain services might also be reserved
for, or made more accessible to, smaller organisations, using
EU procurement rules or the Request for Quote model suggested
by witnesses. Ultimately this might result in more successful
bids by community groups, using either more responsive commissioning
processes or through a revamped Right to tender for local authority
services. We recommend that the Government work with local
authority commissioners of services to involve communities routinely
in the design of services; consider whether certain services might
be reserved for community enterprises using either a normal tendering
route or a Community Right process; and rename the Right to Challenge
in order to reduce the perception that it is confrontational.
97 Department for Communities and Local Government,
You've got the power: a quick and simple guide to community rights,
September 2013, p 16 Back
Community Right to Challenge, Standard Note, SN06365, House
of Commons Library, April 2014, p 3. Local authorities may require
certain information to be included in the expression of interest:
for example, the challenging body's financial resources; evidence
that they could provide the service; information about proposed
sub-contractors; evidence identifying which services are the subject
of the challenge and what outcomes would be achieved. The EOI
must also demonstrate what economic, social and environmental
benefits would arise from the challenger providing the service.
The local authority can reject it on various grounds-including
not enough information provided, service is stopping, procurement
is already underway. Back
Locality (CRS 040), para 3.6. The survey was of community organisations
and non-enquirers to its advice service. Back
Department for Communities and Local Government, (CRS 046), p
Department for Communities and Local Government, (CRS 046), p
1. On the three contracts awarded, written evidence to this inquiry
referred to one successful procurement exercise-in North Norfolk.
Further research revealed another: Buckinghamshire and Milton
Keynes Fire and Rescue Service transferred its business fire training
service to two employees in August 2014. The third is not known.
See for example Locality (CRS 040), para 3.7 Back
NAVCA (CRS 027), p 2. See also the Community Development Foundation
(CRS 015), para 2(v) Back
Plunkett Foundation (CRS 011), para 17 Back
Cornwall Council (CRS 008), p 5. Social Investment Business also
described the tender process as "complex" (CRS 041),
p 1 Back
Social Investment Business (CRS 041), p 7 Back
Locality (CRS 040), para 5.1 Back
Cornwall Council (CRS 008), p 6 Back
Qq198 [Seb Elsworth], 195 [Tony Armstrong] Back
Q196 [Tony Armstrong] Back
NAVCA (CRS 027), p 3 Back
Communities and Local Government Committee, Sixth Report of Session
2013-14, Local Government Procurement, HC 712, para 48 Back