Local Government & Social Care

16 April 2018 OMBUDSMAN Mr Bernard Jenkin MP Chair Public Administration and Constitutional Affairs Committee House of Commons London SW 1 A OAA

pacac@parliament.uk

Dear Mr Jenkin

Thank you for the opportunity to give evidence to the Committee as part of your inquiry into sourcing of public services and lessons to be learned from the collapse of Carillion. l welcomed being able to discuss our experience of dealing with complaints where the provision of services has been outsourced and I hope that Committee members found this useful.

In a changing public sector landscape, the who of accountability remains unchanged - we are clear when we investigate that local authorities retain ultimate responsibility even when services are at an arms' length by external contractor. We rightly hold local authorities to account for the actions of their suppliers when things go wrong. Our legislation is clear that the public retain their right of access to the ombudsman when a function or service is provided by some other body, rather than directly by the local authority.

Local authorities are increasingly looking for alternative, innovative ways to deliver services and are transforming services through increased commercialism, arms-length arrangements and partnerships. These arrangements need to retain visibility with the public and democratic oversight by councillors. As I mentioned in my evidence to the Committee, our main concern is that accountability is not lost or diluted, regardless of how services are delivered.

What our investigations show clearly is that effective outsourcing doesn't happen by itself ­what often drives failure in this area is where the responsibility for complaints, and learning from complaints, is not hardwired into the agreements local authorities put in place with their contractors from the outset. Furthermore, complaints provide a vital source of information about how outsourced services are performing. Our experience is that there is scope for information about complaints to feed into assurance and scrutiny arrangements much more, particularly in cases where services are delivered at arms-length.

As I highlighted during the session, we now commonly see the issue of local authorities working with partners in the delivery of services feature within our investigations. In recognition of the increasingly diverse delivery arrangements, we have produced principles of effective complaint handling that local authorities should embed into outsourced, arms­length or commercial delivery arrangements as part of our manual for councils - I have included these as an annexe to this letter.

Contd/........ .

Earlsdon Park T: 0330 061 0614 53-55 Butts Road W: www.lgo.org.uk Coventry CV13BH

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I hope this is helpful and look foiward to contributing to the work of your Committee in the future. As a final point, as we are shortly due to publish our new three year strategic plan, I would welcome an opportunity to meet in order to share with you our plans and how we aim to transform our service in the coming years.

Yours sincerely / Iu Michael King Local Government and Social Care Ombudsman for England Chair, Commission for Local Administration in England

Annexe - LGSCO manual for councils and authorities 'Principles of effective complaint handling under arrangements with third parties ("partners") for delivery of services1

Legal and policy background • Councils frequently provide local public services by arrangement with a third-party

partner, e.g.: o commissioning specific services from a private or third sector provider (e.g. a

care home place or housing repairs) o contracting for a provider to undertake a whole service area (e.g. that of the local

housing authority or highways authority) o setting up a separate limited company under council ownership to provide

services (e.g. to a defined customer group with a specialist focus) o entering a partnership with other councils, NHS bodies, or other agencies to

deliver combined or shared services which include council responsibilities (e.g. mental health or l~arning disability partnership trusts).

• The law says the Ombudsman can treat the actions of third parties as if they were actions of the council, where any such third party arrangements exist (Local Government Act 1974, section 25(6) to 25(8). This means councils keep responsibility for third party actions, including complaint handling, no matter what the arrangements are with that party.

• Regulations also govern how councils should handle complaints about Children's Services and Adult Social Care (The Children Act 1989 Representations Procedure (England) Regulations2006, The Local Authority Social Services and National Health Service Complaints (England} Regulations 2009.) That a partner may be involved does not change the legal requirements.

Contract or other agreements • The processes for dealing with complaints from members of the public and disputes

between the council and the provider, perhaps as a result of such complaints, should be clearly differentiated.

• Councils should include clear arrangements for complaint handling in any contract or agreement under which its partners provide public services. The arrangements should:

o be consistent with any statutory requirement (e.g. timescales for children's social care complaints)

o reflect the nature of the contract. For example, a large care provider may have resources to manage its own complaints procedures, but a smaller, single care home business may not

o be clear about when the council expects a partner to channel complaints from members of the public to a complaints procedure and when other channels are more suitable. For example:

• most complaints about a parking or moving traffic Penalty Charge Notice would be more suitable for the statutory representations and appeal procedure

• complaints about legal action are best dealt with by the court itself as part of the proceedings

1 https://www .lgo.org.uk/assets/attach/2883/Manual%20for%20Councils%20v8%20March%20201 8.pd !

• complaints about matters like nuisances and unauthorised development work the council or its partners did not know about should be treated as service requests rather than complaints

o include clear agreement on how the council or its partner will handle a complaint regardless of which of them receives it; who is responsible for telling citizens about the arrangements and when; who will be responsible for responding to them, and what procedure to use.

Handling complaints • Councils and their partners should agree what the complaints procedures will be, but

they may wish to consider the Ombudsman's published guidance 'Running a complaints system'.

• Complaints about service or funding levels and policy need to be addressed by the council, not a partner.

• Because a council remains responsible for partners' actions, it will wish to know about complaints, both for monitoring the contract or agreement (see below) and so it can suggest ways to resolve them where appropriate.

• The agreed procedures should be easy for members of the public to understand, simple to use and in no way deter them from complaining.

• Most complaints procedures have two or three stages. The number of stages which have to be followed should be minimized.

• The procedure should make clear: o who is responsible for managing each stage; and, o how to signpost complainants to the next stage (including, ultimately, the Local

Government and Social Care Ombudsman) if they remain unhappy. o Councils and their partners should ensure all their staff know what the

arrangements are and what their role is in carrying them out.

Monitoring and Training • Complaints and how they are dealt with may be a useful measure of contractual or other

expectations and may assist in their enforcement.

• Councils should decide how they wish to oversee the effectiveness of complaints arrangements and what data collection and reporting they need. They may want to be notified of each complaint and outcome, or want information/statistics collated and available on demand or request. This will depend on the nature and scale of the contract or agreement. The identity of complainants should not normally be discernible from published material.

• Details of complaint monitoring arrangements should be decided with partners at the outset.

• Councils and their partners should ensure they learn from complaints, both about what works well and what needs improving. The arrangements between them should include a way to do this.

• The Ombudsman can support councils' arrangements with their partners by providing suitable training in complaints handling.