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Concerns growing over impact of call-off frameworks on the sector
Three providers in different fields have raised with VAC their concerns over the use of ‘call-off'-type commissioning frameworks for work previously funded through block contracts. Whereas block contracts guarantee a level of income, call-off frameworks pay for outputs based on actual usage. These can work in some services where there is a high level of take-up and an established use of bank staff, but do not necessarily work in other services and can place too much risk upon the provider.
The key issue here is therefore the fair sharing of risk - unless the provider has some guarantee of take-up, the provider is taking all the risk in employing staff without knowing future income, and few if any have sufficient reserves to be able to take that risk for any length of time. The net result is that at a time when personalisation needs a good market of providers to choose from and develop better, more personalised services, some providers may be forced to withdraw from the market for that service or could even close completely.
Whilst call-off frameworks are not specifically referenced within Coventry's Compact, the issue of risk is very clear - one of the examples of unacceptable practice listed in Coventry's Compact funding code is "Placing ALL the risk upon the provider". Examples of Compact good practice include an expectation that funders will "discuss risks up-front and place responsibility with the public sector body or voluntary and community organisation best able to manage them", and that voluntary organisations will "share risk appropriately between the funder and the provider."
Whilst we fully understand and accept the Council's financial circumstances and the need to save money in sensible ways to avoid cuts where possible, this particular issue could be very damaging to the sector and leave the local authority with fewer local providers in future and a knock-on effect on their wider social objectives.
Some providers may prefer to lobby on their own and we understand and respect that, but we would like to give providers the opportunity to lobby on this issue collectively. If you have a block contract which is being replaced with a call-off contract, please speak in confidence to Rob Allison or e-mail r.allison@vacoventry.org.uk in the first instance.
To access all of the Coventry Compact codes, please click here:
