1. ‘Turning the Tide’ Briefing for providers and investors 12 February 2016

2. Objectives of session
Share information about our Social Impact Bond proposal and the draft procurement plan
Gain insight from potential providers and investors to enable our approach to be refined
Provide opportunities for discussion and networking between the Council, investors/intermediaries and providers

3. Running order Welcome and introductions
Background to project, detailed proposals and assumptions
Refreshments, discussion and questions
Proposed procurement process and timeline
Networking , informal discussions

4. Drivers for North Somerset Council
Overall a prosperous area with great potential for growth
But significant pockets of real deprivation
Ambitious plans to improve the lives of local people
Strong political commitment to innovation

5. Ambitious for children
Prosperity and opportunity
Drive growth in the North Somerset economy and local jobs
Make sure all our town centres are thriving
Enable young people to fulfil their potential
Make sure all our communities share in prosperity and employment growth
Health and wellbeing
Enable residents to make healthy choices and promote active lifestyles which reduce ill health and increase independence
Support families to give their children the best start in life
Commission or provide quality health and care services, which deliver dignity, safety and choice
Quality places
Enable sustainable housing growth which protects our natural and built environment and the special character of our villages
Build and sustain great places to live and visit – vibrant, accessible, and safe
Empower people to contribute to their community and communities to provide their own solutions
Under each of these, we have identified three or four specific ambitions

6. CLA numbers look high..

7. Distinctive Profile of looked after children
High proportion looked after under voluntary arrangements (sec 20)
High proportion starting be looked after aged or 16 +
Very high proportion looked after due to ‘family in acute stress’ or ‘family dysfunction’
High proportion placed with family or friends

8. Children starting to be looked after last 12 months

9. Outcomes are mixed (as elsewhere)
For example:
16% of North Somerset CLA got 5 GCSEs A-C compared to 58% for all children in North Somerset (2015)
48.8 % EET (March 2015)
Body of research shows increased risk of poor long term outcomes

10. Costs are unsustainable

11. Turning the Tide
We started off looking at intensive family preservation models such as home builders
Development work suggested our initial analysis was sound
However, decided not restrict providers to a specific evidence based approach
Important to work both sides of the care boundary

12. Focus on 2 cohorts
families with a child currently looked after under s.20 and with a plan to return home (c 40); and
families with a child aged on the edge of care and at imminent risk of becoming looked after on a voluntary basis (c 50 p.a)

13. Primary outcomes
For Cohort 1, the child returns home more quickly than he/she would otherwise have done and stays there for a defined period; and
For Cohort 2, the child is diverted from care and remains at home for a defined period.

14. Secondary outcomes

15. Approach to outcomes payments
90% of outcomes payments will be focused on primary outcomes;
10% on family functioning
Other secondary outcomes will be measured but not subject to outcomes payments
Payments based on four events

16. Payment structure and metrics
Event
Outcome
When
Payment 1
Child returns to the family home Or
Child remains at home and no longer needs to enter care
Four weeks after completion of FPS intervention (10 weeks)
20% 2
Child remains at home for a further six months
Six months after event 1 (36 weeks)
40% 3
Family and child achieve defined improvement in Outcomes Star scores compared to score prior to event 1
10% 4
Six months after events 2 & 3 (62 weeks)
30%

17. Key assumptions
Service will cost approximately £350k per year (£1.4 million over years)
It is possible to significantly improve on treatment as usual (35% diverted from care, based on four years data)

18. Potential payments per child
After 10 weeks £1,917
After 36 weeks £3,833 plus
outcomes star £958
After 62 weeks £2,875
Total £9,583

19. Potential outcomes payments overall
Scenario
Success rate
Outcomes payments
Surplus/loss
‘Base’
70% (148/240)
£1.61 m
210K
‘Best’
85% (204/240)
1.958 m
558K
‘Worst’
55% (132/240)
1.265 m
-£135K

20. Operational model

21. Risks and mitigation Risk Mitigation Changes in needs or numbers
Modelling based on long term trends
Intervention may be scalable
Insufficient Referrals
Presumption that all children in the relevant cohorts will be included
All referrals go through single placements team and agreed by Assistant Director
Children wrongly referred or not referred
Allocated social workers and independent reviewing officers will focus on child’s welfare
Intervention is less successful than expected
Conservative assumptions used in modelling
If service is not effective, it could be ended early
Provider carries too much risk
Providers can negotiate a reasonable risk share

22. Procurement: Underlying principles
The market knows as much as we do – we wish to avoid being prescriptive
Therefore, we have no preconceptions on:
The contractual relationship between all parties
How risk will be apportioned
How much the Council will be involved in developing consortia
We are proposing to use Competitive Dialogue:
CD is designed to develop solutions during the procurement process
We may get different solutions/models that all meet our outcomes
We want a solution that is locally driven, utilises local businesses, engages the VCSE sector properly, and delivers social value over and above the primary outcomes.
But... we are aware of the risks of CD e.g. can be resource intensive and will make sure the dialogue is focused and proportionate
We want to take your feedback into account before making a final decision

23. High level timeline Pre-Qual (Mar/Apr) Dialogue (Apr - Jun) Tender
(Jun/Jul)
Evaluation
(Jul/Aug)
Award
(Aug/Sep)

24. Timeline – areas of flexibility
Dialogue phase:
We envisage one day per bidder per week
We don’t know how mature/developed solutions will be at the start of the dialogue process
Award:
We are advised to allow a reasonable period of time for final approval from investors
Implementation:
Mobilisation period may vary between bidders

25. Your feedback – Key Qs
1. How attractive is this project to providers, and what could the council do to increase this? 2. How attractive is this project to investors, and what could the council do to increase this? 3. What do you think of our proposed outcomes and outcome payment metrics, and the assumptions that underpin them? 4. Is the nature of the cohort appropriate for a SIB arrangement, and do our proposed volumes provide sufficient critical mass to make this workable?

26. Your feedback – Key Qs
5. The council is approaching this procurement process having given initial consideration to the type of intervention, operational model and how risk is likely to be apportioned across the commissioner, investor and provider. We have not at this stage favoured a particular contracting model. The intention is that these aspects will be further developed during the dialogue process. Do you have any concerns about this type of approach? 6. How realistic is our procurement plan, and what could we do to improve it? 7. Is there more that we can do to facilitate discussion between investors and providers?

27. Feedback process
Please provide feedback using the questions (and anything else you want to tell us) to:
Happy to answer questions now or during informal discussions or during next week.
We would appreciate a response by Friday 19th Feb