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Business Case Template for Significant In-Housing of CSS CSS Market Development Team, Feb 2014.

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Presentation on theme: "Business Case Template for Significant In-Housing of CSS CSS Market Development Team, Feb 2014."— Presentation transcript:

1 Business Case Template for Significant In-Housing of CSS CSS Market Development Team, Feb 2014

2 Section 1: Rationale for the Proposed Change and Strategic Fit This section sets out how the proposed change from an outsourced to an in-house service fits with and helps you deliver your strategy Include a description of: a)The current outsourced service b)Why a change is needed to meet your strategic objectives c)The change proposed d)The principal benefits expected from the change (e.g. reduction in cost; improved information on which to base commissioning decisions) e)The strategic and cultural fit of the proposed in-house service Questions to ask: a)Have other alternative options been considered? b)Could the required service improvement be better delivered by changing the way the outsourced service provider is held to account and managed? 2

3 Section 2: System Impact This section describes the outcome of your consultation with other NHS and public sector bodies in your locality (e.g. CCGs, CSU, Local Authority, NHS England) about the proposed change and your assessment of the impact on them Include a description of how you have: a)Assessed the impact of the proposed change on other NHS/public sector organisations b)Engaged with the affected organisations c)Quantified any cost impact for other organisations and explored options to mitigate / avoid costs d)Reached agreement with affected organisations on who will bear any unavoidable costs 3

4 Section 3: Impact on staff This section describes how you have assessed the staff impact Describe your assessment of: a)The number of staff who will transfer from the current provider to the CCG b)The number of redundancies within the current provider and the cost of redundancy c)For staff who do transfer, the impact on their future development and career progression opportunities d)The impact on staff retention and succession planning e)The impact on existing CCG staff, including the leadership team 4

5 Section 4: Expected Cost Impact of the Change This section describes how you have established the one-off costs of implementing the change and the on-going operating costs of the proposed in-house service vis-à-vis the current outsourced service One-off costs: These will be dependent on the nature of the proposed change, but are likely to include: a)Project/change management costs b)Staff related costs (e.g. transfer / redundancy) c)Double running costs On-going (operating) cost comparison Outsourcing cost estimate: based on a quote from one or more external CS suppliers In-house cost estimate: assessment of on-going staff and related costs (see Annex 2) Questions to ask a)What is the estimated impact of the in-house option on the need for future investment spending (e.g. on staff development, ICT) to develop the service? b)Is future cost inflation more likely in an in-house or outsourced service? 5

6 Section 5: Quality of Service Impact This section sets out how you have established the expected service quality benefits of the change Describe your assessment of: a.The quality of service delivered under the current outsourced service and why this is insufficient b)The expected quality of service under the proposed in-house service c)The mechanism for quality improvement - the principal differences between the existing outsourced service and the proposed in-house service that will drive improvements in service quality d)The leadership requirements for the in-house service e)Where possible, the estimated financial benefit of the proposed change 6

7 Section 6: Service Resilience and Sustainability This section describes your assessment of the resilience and sustainability of the proposed in-house service compared to current outsourced service Describe, for the in-house option and the current outsourced service: a)The risk of inadequate service and how it is/will be mitigated (e.g staff and/or contract management procedures) b)The resilience of the service and likelihood of loss of continuity (e.g. impact of loss of key team members) c)The sustainability of the service (e.g. likelihood of cost inflation in future, ability to invest in service development) 7

8 Section 7: Summary and Conclusion This section summarises your findings on how the proposed in-house option compares to the existing outsourced service Comparing the proposed in-house and current outsourced service, describe the expected long-term impacts on service: a)Capacity b)Quality c)Affordability d)Resilience e)Sustainability 8

9 Annex 1: Costing In-House Provision STEP 1: PAY AND BENEFITS COSTS Estimate the WTE staff by pay band required to deliver the function (use the mid-point of the pay band or the exact point if known – e.g. if existing NHS staff are transferring in under TUPE) Apply a percentage uplift to salary cost for on-costs (employer national insurance and pension contributions). Your finance department will advise on the exact uplift to be used. STEP 2: NON-PAY COSTS For each staff member, estimate the non-pay costs (training and development; office consumables; travel and subsistence; IT and communications equipment) STEP 3: INCREMENTAL OVERHEADS For each staff member, estimate the incremental corporate overhead cost (HR, finance, payroll, and IT; office furnishings, office space; and other) 9

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