Agenda item

 (1)      The Chairman welcomed Mr Martin to the meeting and asked him to introduce himself before answering questions from Members of the Committee.

(2)      Mr Martin said he was attending the meeting in two capacities – as CEO of KentCan which had linked policy makers, commissioners and decision makers with 2,500 voluntary sector organisations until it ceased operating on 31 January 2014 and as Director of CAP Enterprise which provided business support to social enterprises. 

(3)     Mr Martin referred to the paper that had been circulated with the agenda for the meeting which was based on over ten years of experience. He said the voluntary and social sector was very diverse and all bar the very largest faced some risk from the change to a commissioning based environment. Reliance on grants should diminish as organisations increase, but the opposite is occurring.

 (4)  Mr Martin said it was essential to bring commissioners and frontline organisations closer together and in particular to develop and use a single independent point of access.  He also said those commissioning services within KCC had to increase the amount of communication to enable frontline organisations to engage.  There was also need to develop a framework to enable commissioners to understand the social impact of frontline services. 

(5)   Mr Martin said the development of consortia was not common and often when large national organisations facilitated the establishment of consortia smaller frontline organisations were used as “bid candy”. In addition the large organisations often creamed off the most profitable work and passed work with hard to reach groups to smaller voluntary organisations which in turn put the most vulnerable at increased risk.

(6)  Mr Martin said an influx of commercial minds was needed on many boards of trustees. Many boards were risk averse and lacked the skill sets to undertake more commercial activities.  He also said that most organisations in the sector did not have access to resources that would facilitate business development and found the process for the submission of tenders too onerous and time-consuming.  For example, it had taken him over a week to prepare a tender for a two-year contract worth £50,000.  Many organisations did not have this capacity and would be unable to compete.

(7)   Mr Martin said the linkages within the sector were relatively weak and there was evidence of partnerships fragmenting, silos building, and organisations becoming isolated when should be working together. Infrastructure organisations tended to invest insufficient time to developing sector-led consortia possibly because to survive many were also delivering frontline services and competing against their peers.  He also said that many board members had been in post for more than 20 years and in some cases moral and emotional fatigue had set in.  He referred to an investment of £150K made by Suffolk County Council in 2011 to enable third sector organisations to develop their ability to secure public sector contracts.

 (8)   Mr Martin said it was a myth that third sector organisations could automatically access match funding or that there were significant numbers of capable people just waiting to volunteer.  He said that the voluntary sector did not engage directly with the EU and that although 20% of the LEP’s work should be directed at addressing poverty it was essential to allocate technical assistance to enable frontline organisations to play a role.  In a recent on-line survey over 70% of respondents thought they were not well connected with their strategic partners and wanted better direct links with the county’s commissioners, decision-makers and senior politicians..

(9)      He concluded by saying that some smaller organisations would only get involved in the commissioning agenda by joining consortia that were lead and managed ethically by trusted lead organisations. He also emphasised that KCC needed to collaborate with social organisations to identify and measure the social value of each contract as part of the commissioning process.

Question – There are many professional people in the voluntary sector but is the red tape involving in bidding for tenders inhibiting activity?

 (10)    Yes.  Making tender bids is complex and many organisations lacked the expertise, scale or capacity to bid.  KCC needed to consider a budgetary mix of both grant aid and commissioned contracts.  Such a mix could be highly effective but communication was vital.  It was important to hear the voices of as many frontline organisations as possible, as they are the county’s community-level experts. He felt that the aged model of representation was a flawed one; and that with appropriate use of technology and creativity the county’s commissioners and procurement staff could benefit from better links with frontline community organisations.

Question – Are you saying that providing grants enables voluntary/social organisations to acquire professionals to deliver services whereas the commissioning model takes away this opportunity? 

(11)  Consultation and communication are essential early in the commissioning process to ensure the voluntary sector is not excluded and that the voices of those delivering the services are heard. Currently too many organisations are relying on “representatives” to speak on their behalf at County Hall, and frontline organisations have little opportunity to have their voices heard.  If these voices were heard then more organisations could embrace the commissioning process more effectively.

Question – Could you give me a feel for Kent Can, how big was it? Could KCC assist CAP Enterprises to develop?

(12)     KentCAN was established to be the voice of the voluntary sector and to network with strategic partners.  KentCan represented over 12,000 organisations and 17 infrastructure organisations - CVSs and volunteer centres.  By 2014 this structure had fragmented as a result of competition and reduced funding and Kent CAN no longer had the mandate to represent the whole sector.  CAP Enterprise was set up in 2011 to help increase the number of Kent-based social enterprises through the delivery of specialist, accredited business support.

(13)     There is a need for a single county-wide organisation which would work to establish a clear and highly accessible gateway to the voluntary and community sector – working to reduce the gap between commissioners and the frontline. It would act as an honest broker and would not require significant resources.  Two people could run market events, grow a database and extend its reach.

Question – Social Enterprises operating as trading organisations - what successes / failures?

(14)        In Medway £400k funding was allocated over four years to develop infrastructure organisations.  Ten commercially minded voluntary sector organisations were assisted to move from being grant-oriented to being able to trade.  In 2011 CAP was commissioned to help KCFN develop business processes which would lead to it increasing its turnover to £0.5m per annum.

Question – Are CVS effective?  Are some service areas better at commissioning than others?

(15)     Some CVS are excellent - they have a clear understanding of the environment and are very well connected with their member organisations.  Others are less focussed on supporting their frontline members. The availability of expertise is patchy at best.  A market event at which eighty organisations were represented was held in the early stages of the commissioning process for early years’ services.  Rather than using this event as an opportunity to co-design models of service and specification, KCC presented a model of best practice picked up from elsewhere in the UK. The end result was the disengagement of the majority of the organisations present and the loss of their combined knowledge and expertise.

Question – How do you think we should pull this together?

(16)     Be brave. Consider radical change.  A hub and spoke model is one possibility - a local presence coupled with a central hub providing quality expertise across the county on a range of issues such as intellectual property rights, governance, HR, social enterprise, training, and TUPE.  Procure a service rather than funding an organisation.

Question – What should KCC be doing about commissioning with the voluntary sector? How can we assist with the formation of consortia?

(17)     KCC should be investing in difference and facilitating some management processes for the voluntary sector.  KCC should invest in infrastructure that narrows the communication gap between commissioners and frontline service providers.  There is also a need to recognise and value the existing partially formed communications structures.  The general feeling within the sector is that KCC tells them what to do rather than engaging in genuine consultation and co-operative working. Support a trusted and capable organisation to lead consortia.

Question – Why do grants become more important as organisations get bigger?

(18)     Smaller organisations are often more experienced at managing a diverse income structure and at being lean.  Larger organisations often lack adaptability and may face diseconomies of scale – one of them being the inability to adapt to change quickly enough.

Question – Do you think KCC should be organising the communication layer?

(19)  No. An independent and dedicated organisation should be commissioned to take on this role with sensible targets of growing the data base to widen links with frontline VCSOs.

Question – Local government tends to use “approved lists”.  Would the abolition of such lists broaden the market place?

(20)   Barriers exist within the procurement process itself.  Language is important in fostering good relationships between voluntary sector and commissioners.  The procurement process appears to be daunting to the voluntary sector – 78% of KentCan members do not like current procurement model.

Question – Would fear of ideas being stolen inhibit the coming together of commissioners and providers to brainstorm ideas and co-design service or would it be better to negotiate a contract?

(21)     It would be possible to co-design.  KentCAN was going to form a consortium to bid for a tender and 30 of its member organisations expressed an interest.  In this instance KentCAN would have operated as the contract manager and would have sub-contracted work to its member organisations.  In the end a confidentiality agreement was drawn up with 12 partners to cover the tender preparation process.

Question – How do you transfer risk?

(22)     Risk is not transferred. It remains with the umbrella organisation, ie. the organisation proposing to lead the consortium.

Question – How do you see the elected member role in this process?

(23)     Read the Voluntary Sector Compact and keep pressure on to sure it continues to be applied and push for change in the way the frontline voluntary sector is supported.