Commissioning intelligence
The recent government-funded MOPSU project has yielded some insights into what public service delivery providers are really achieving. Clarissa Dann looks at the implications for the voluntary sector.
Public services account for around 20 per cent of GDP in the UK, and well before the change of government and public spending cuts announcements, HM Treasury funded a £2.5m research project (as part of the ‘Invest to Save Programme) examining the quality and outcomes of social care services and early years education. The third part of the project included an analysis of the voluntary sector’s role in delivering public services.
Background to the MOPSU project
The Measuring Outcomes for Public Service Users (MOPSU) project was presented on 7 June 2010 with the objective of:
- promoting more effective commissioning of services so that quality and value for money were ‘at the heart of the decision-making process’;
- encouraging the use of ‘outcome’ measures to assess the effect services have on their users, across the spectrum of providers;
- examining the extent to which the voluntary sector is involved in public services delivery and helping to alleviate barriers to entry.
Each of the three partners undertook their own independent research and published their research reports, with the Office for National Statistics summarising the key information from all three reports. Further details of all three reports can be found on the dedicated area of the ONS website at: www.ons.gov.uk/about-statistics/methodology-and-quality/measuring-outcomes-for-public-service-users/index.html.
However, a useful portal summarising all the research with further detail of the implications for the voluntary sector can be found on the NCVO’s website at: www.ncvo-vol.org.uk/ mopsu#results.
The three partners were:
- the Personal Social Services Research Unit (for the adult social care research); and
- the National Institute of Economic Research (for the early years education research);
- the National Council of Voluntary Organisations (for the voluntary sector research.
This article provides a short summary of the early years and social care services projects and more detail on the voluntary sector project findings. It also includes comparators with some of our own research from Charity Financials. I am grateful to the teams at NCVO and the ONS for their permission to share some of their more in-depth findings.
Adult social care
The Adult Social Care Outcomes Toolkit (ASCOT) was developed as part of the project and made it possible to measure from the service user’s perspective key social care outcomes across ‘basic domains’ and ‘higher order’ domains.1 See figure 1.
The toolkit is designed to help commissioners in their move towards contracting adult social care services on the basis of accurately measured outcomes that provide better value for money. It has been tested in around 170 care homes across the different sectors. The study found that these care homes are significantly improving residents’ social care-related quality of life and are thus delivering good outcomes. However, the improvements are particularly strong in the basic domains and less so in the higher order domains. There was no significant difference in outcomes between care homes in different sectors. However, residents in voluntary sector care homes tended to have fewer needs – resulting in the voluntary sector homes catering for a less dependent population.
Early years education
Analysis of quality and outcome in early years education showed that children who started this before the age of three had higher Foundation Profile assessment scores than children who start at three or four. There was no systematic difference in outcomes by different sectors. Since the study was carried out, the Early Years Foundation stage was introduced in 2008, and the quality of Foundation State Profile assessment scores improved. Ofsted have introduced a new inpection framework with a clearer focus on the development and early learning of children.2 Role of the voluntary sector in public service delivery.
Levels of government funding
According to the MOPSU research, income from government amounted to £12.8bn in 2007/08. When you take into account the Charity Commission’s figure of a total of £52.6bn.3 Over the last seven years, the increase in the voluntary sector’s income from government sources has outpaced the overall increase in government expenditure on public services. Cathy Pharoah and Mark Pincher investigated the effect state funding was having on the sector over two years ago in the article ‘Cash for Services’ (see Caritas, issue 3, February 2008) and figure 4 sets out Charity Financials’ latest analysis of the top 100 charities by amount of state income identified in those charities’ accounts.
When a wider group of the top 5000 charities were examined by Mark Pincher, he found that 1193 of them (23 per cent) received statutory funding to the tune of £5947.7m. Compared with state funding levels from the two previous years the growth is very clear. In 2006/07 the top 5000 charities received at total of £5.086.3m. This grew to £5611.3m in 2007/08 (by 9 per cent) and grew again by 5.9 per cent to the current total.
Some sectors more state dependent than others
The MOPSU project research found that five service areas are heavily dependent on government funding, receiving over half their total income from the government. These are: employment and training, law and advocacy, education, housing and social services (see figure 2).
Statutory funding accounts for over 70 per cent of the income received by voluntary organisations within the employment and training sub-sector. The researchers observed this was most likely to be due to the high proportion of public services delivered by this sub-sector. While some organisations receive income from the government through a variety of funding streams and providers, others receive relatively large amounts of funding from just one or two government bodies or ‘pots’. The research also found that over half the funding from local government to the voluntary sector went to the social services sector and more than 10 per cent goes to voluntary sector organisations working in the health sector.
Grants and contracts
The research found that in 2007/08 nearly three-quarters of government funding to the voluntary sector was in the form of contracts. This gives an indication of the level of involvement from the voluntary sector in the delivery of public services. See figure 3.
Government bodies transfer resources to voluntary sector organisations using a number of mechanisms and these are usually categorised as:
- voluntary income (grants); or
- earned income (contracts).
Grants worth 3.7bn and contracts worth £9.1bn were awarded to the sector in 2007/08 when the £0.9bn in grants and contracts from European and international sources is taken into account. The balance between grant and contract funding has changed over time, with figure 3 showing a continuous upward trend in the total value of contract income and government grants to the sector declining.
The researchers make the point that the decline may appear deeper because of increase in grants earlier in the decade. Further detail is available in the report from NCVO Estimates of Government Funding to the Third Sector: Experimental Statistics 2010 published at the same time as the conclusion of the MOPSU project (downloadable from the NCVO site).
A comprehensive analysis of statutory funding levels and its potential impact on independence by Cathy Pharoah and Mark Pincher was published in the article ‘Whose strings’ (Caritas, issue 9, August 2008, p18), and the authors observe: ‘it is particularly valuable to keep an eye on levels of grant versus contract income’. But, they, caution: ‘the amount of statutory funding which is truly independent is decreasingly distinct, because of some of the confusion about what was really a grant and what was really a contract when it came to reporting in the accounts what funding mechanism was used. Back in 2005, a National Audit Office Report revealed: “there is little settled practice [local councils] on whether to use grants, contracts or procurement.” Grant arrangements often had the same four key elements as contracts: an offer, an acceptance of the offer, a consideration [e.g payment], and the intention to create legal relations.’
New definitions and the need for clarification ,articulated by the authors, remains important: ‘As the third sector’s funding involvement with government grows, the need to clarify the different kinds of funding relationships and rationales will also grow…undoubtedly historical funding patterns and relationships with individual charities have an influence but ultimately this cannot provide the basis of growing funding of the third sector as a service-delivery partner in the modern environment.’ Turning to the MOPSU research, it would appear the pendulum has swung even further in the direction of contracts. It comments that the increasing importance of contracts, fuelled mainly by an increase in the value of contract income, is evident for both central and local government, highlighting the fact that 77 per cent of local government income to the sector is contracted, compared with 61 per cent of government income.
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Overall implications of the MOPSU project for the voluntary sector
Karl Wilding, NCVO’s head of research, who carried out the voluntary sector-specific research observed:
- the volume of service provision by the voluntary sector has risen substantially;
- service provision makes a real difference to the lives of service users, particularly those with high levels of need;
- the voluntary sector does not achieve better direct outcomes than those achieved by other sectors; but
- measures do not capture the full value – for example they cannot tie down indirect outcomes for service users.
NCVO is going to make further recommendations to the government on how to collect more detailed data and has called for more in-depth programme level public service delivery expenditure information.
The Holy Grail of placing a financial value on the outcomes still eludes all the researchers – only the cost of the outputs is known at the moment – and there is, he believes, more work to be done with policy makers on encouraging the usage of outcomes measurement in commissioning.
The MOPSU principles and toolkit have been an important step forward, but there is more to be done to take what has been achieved so far to arrive at outcomes measurement tools that can be used intuitively across the sectors and inform capacity building and service delivery.
1. The toolkit is soon to be available free of charge from www.pssru.ac.uk, but also of interest is PSSRU’s final 122-page report on outcomes measurement (Discussion Paper 2696/2 ) which is available now.
2. Further information about the NIESR project, started in 2007 is available from David Wilkinson at www.niesr.ac.uk
3. www.charity-commission.gov.uk/ About_us/About_charities/ factfigures.aspx
Author: Clarissa Dann
Clarissa Dann was the editor of Caritas as well as an HR and management online service,he People Bulletin until July 2011.
She is now the editor of the specialist trade finance magazine, Trade and Forfaiting Review which can be viewed at www.tfreview.com but does write on charity finance and investment from time to time.
Clarissa has a background in legal and professional publishing, as well as business journalism and holds an MBA from
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