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SPOTLIGHT |
SPOTLIGHT |
The National Audit Office has called on the Department of Health to reassess its approach to contracting with social enterprises.
In a report the financial watchdog warned that there were risks to value for money associated with the Department’s programme of enabling staff to spin out into health social enterprises.
The NAO acknowledged that it was too early to assess the costs and benefits of the Right to Request Programme. Just 20 social enterprises are operational – most were only launched in April this year and so have no track record.
“What can be said though is that the Department has not set measurable objectives specifically for the Right to Request Programme against which to evaluate its success,” the NAO said.
According to the watchdog, Primary Care Trusts expected social enterprises to deliver more benefits than other providers, but did not generally contract for them to deliver savings or any other additional benefits.
The NAO said the failure to set out explicitly the objectives or to contract for additional benefits would reduce the likelihood of these benefits being delivered. The Department of Health has argued that it did not need to set out the expected benefits of the programme because it contributed to the wider Transforming Community Services programme.
The watchdog nevertheless warned that many risks and liabilities would still remain with PCTs and would need to be managed if value for money was to be achieve.
“In the last resort, the trust or its successors will be responsible for ensuring that essential services continue to operate,” it said. “At least for a time, social enterprises will be highly dependent on work and cash flow from their respective PCTs.”
The NAO also said the social enterprises would be operating in an increasingly competitive market owing to changes in health legislation currently going through Parliament. “PCTs or their successors will need to have a clear idea of how they will react if enterprises run into financial difficult or fail,” it argued.
The NAO recommended that:
Amyas Morse, head of the National Audit Office, said: “There are many risks to be managed if the Department is to get value for money from the £900m contracts awarded to social enterprises. The Department needs to reassess its approach, when contracting with social enterprises, of not requiring efficiencies over and above what would have been achieved if the services had remained within the Department."