Agenda item

To consider an update and lessons learned from the liquidation of NRS Healthcare which was a provider of community equipment in Haringey.

Sara Sutton introduced the report for this item by putting on record her thanks to Council officers for their response to a significant provider failure which had required a collaborative cross-Council effort and ensured a safe and effective transition to the new arrangements.

Cllr Connor requested an explanation of what learning there had been from the provider failure. Rebecca Cribb, Head of Adult Social Care Commissioning & Quality Assurance highlighted some key points about the actions taken after NRS Healthcare Ltd ceased trading:

·       There had been a direct award of a contract given the circumstances. This was made to Provide Care Solutions Ltd as a three-year contract with the option to break the contract after two years based on performance.

·       An eight-Borough partnership, called the North London Equipment Partnership, had been formed to benefit from economies of scales and operate from one warehousing space. The London Borough of Camden was leading on commissioning and contract management with regular meetings between the partners.

·       Earlier financial insight into providers was highlighted as a key learning point.

·       There was also an aim for longer-term efficiencies to be achieved through partnership arrangements. The current low levels of recycling of equipment was an area that could be improved in the future.

Rebecca Cribb then responded to questions from the Panel:

·       Cllr Brennan highlighted a case of a resident who had been waiting for an accessibility adaptation to her home for three years and this was now going ahead which was a positive sign.

·       Cllr Iyngkaran commented that there could be unintended consequences of awarding a direct contract and asked how agreement was reached between the Boroughs on this. Rebecca Cribb explained that the decision needed to be made quickly and that the immediate response was supported by ADASS, the LGA and the London Consortium. This was part of the efforts to scout the market and approach the large providers and also smaller providers in the London area. As many as 42 Boroughs across the country had been impacted by this provider failure so this involved a major call to action to bring about the conversations, negotiations and due diligence. Cllr das Neves commented that she had seen the significant impact on the team and the time spent on various conversations to explore different options on providers and working with different Boroughs.

·       Taryn Eves, Corporate Director of Finance & Resources, added that the challenge had been getting assurance that due diligence had been carried out and that value for money was being achieved while also protecting a service being provided to some of the Borough’s most vulnerable residents. While there hadn’t been time to fully test the market, it was also the case that the market was relatively small so there was a sense of realism. She added that resources were shared between Boroughs to carry out the financial due diligence checks so this had been carried out even though it may have been done quicker than usual. Bobbi Virgo, Head of Supply Chain (Health & Care), emphasised the limited provider choice that was available in terms of equipment and warehousing but also the fleet to move the equipment.

·       Asked by Cllr Iyngkaran about the procurement process at the end of this two or three-year contract, Bobbi Virgo confirmed that, while the recent process had involved the minimum procurement requirements due to the urgency of the situation, any future procurement would involve the full usual processes.

·       Cllr O’Donovan noted that there had been very few resident complaints and requested further details on this. Jo Baty said that there had only been 3 or 4 complaints received early on which was unusual as other Boroughs had been inundated with complaints. There had been some proactive communication to residents and an email helpline had been established but there had been little traffic.

·       Noting that there were not many providers in the market, Cllr Connor asked about the work being carried out in procurement to manage risk to the Council in future and embed learning. Taryn Eves explained that, with all open market tenders, financial assessments were undertaken as part of that process and that financial standing was considered at the outset and also on at least an annual basis. She acknowledged the importance of testing providers, particularly in quite fragile markets and one of the lessons was to consider whether doing this on an annual basis was sufficient. Higher risk and higher value contracts involved monthly monitoring in order to get alerts on red flags as quickly as possible. There was therefore a collective organisational action plan that would be assembled on this.

·       Andrew Meek, Head of Resilience, FM & Safety, said that some initial workshopping had been done with some detail of this shared in the agenda papers. The report on this was expected to be finalised in the New Year. He added that the Emergency Planning & Resilience team did a lot of work to support individual services to identify risks, including on supply chain issues. This could be a particular concern for Adult Social Care services and this would be monitored closely going forward. This issue had been particularly difficult because of the scale of the contract which had made it difficult for other providers to step in. A lesson to learn from this was therefore to consider the characteristics of different markets and the mix of suppliers to inform risk assessment and contingency planning.

·       Katie Fisher, Emergency Planning & Resilience Manager reported that the Council was currently reviewing business continuity plans and these would identify risks and immediate mitigations.

·       Asked by Cllr Iyngkaran about the difference between the recent events with social care equipment and the NHS supply chain, Cllr das Neves said that some of the same providers also supplied the NHS and that these issues reflected the marketplace for this type of equipment. Bobbi Virgo added that there were only three viable providers with sufficient warehousing and logistics.

·       Cllr Connor requested that the final action plan be provided to the Panel when it was available and noted that they would be particularly interested to see how this would impact on the Council’s policies and practices during ‘business as usual’ periods. (ACTION)

Cllr Connor expressed the Panel’s recognition of the hard work of officers during this period and looked forward to seeing further details of progress through the action plan.