Council becomes sole shareholder for ‘staff-led’ social work company

Shropshire Council will become the sole shareholder for People2People, an independent community interest company that delivers community social work across the county.

The move is designed to protect the organisation and allow it to continue to develop.

Shropshire Council’s interim adult social care director Andy Begley told Community Care the company was not yet “commercially mature” enough to go to an open market tender, and the new arrangement would ensure it wasn’t exposed to risk.

“We could have put out a tender inviting people to bid for the provision of social work activity in Shropshire but if People2People bid for that contract now, they simply could not meet those requirements because they don’t have the trading background,” he said.

“Everyone is in agreement that this is the best way forward because we can allow People2People to find its own feet, trade independently, and give it time to develop as an organisation and get to a much stronger position to answer a wider open market tender.”

The new arrangement will mean the council can award the contract for services directly to People2People without going out to tender.

This is possible due to an exemption under section 12(i) of the Public Contracts Regulations 2015, which allows for the direct award of a contract to a ‘controlled body’. In order to benefit from this, People2People must have no private ownership, must carry out more than 80% of its work for Shropshire Council, and must be subject to “sufficient control” by the local authority, similar to that which it exercises over its own departments.

The council will also now be able to formally transfer staff to the company, rather than second them, as is the case now.

‘Freedom and flexibility’

People2People was launched in 2012 as part of the Department of Health’s social work practice pilot scheme, which was designed to test the contracting out of statutory adult social work from councils to independent organisations.

The pilot scheme ended in April 2014 but People2People had its funding extended. It previously operated on a co-shareholder arrangement – the two shareholders were non-executive directors for the company Jenny Pitts and Ann Lewis.

The council purchased the shares for £2.

People2People has always been staff-controlled and social workers involved in the company have reported enjoying greater professional freedom, stronger partnerships with people receiving support and increased morale.

Begley stressed that, while the change might look like a “step back”, the council is actually trying to ensure the principles on which People2People has been constructed remain.

“Those of us that have been involved in this from the start are aware that it was the freedom and flexibility afforded to staff to develop the company that created its success,” he said.

“It would really not be in our interests to stymie that at all.”

Terms and conditions for transferred staff will be protected and they will continue to be provided with a local government pension. Staff that have been hired directly by People2People are on different terms and conditions.

Begley said: “As People2People develops I would expect the organisation to develop its own employment packages, bearing in mind that these will have to be attractive in a recruitment environment that is difficult to say the least.”

‘Additional functions’

The company will continue to provide community social work and occupational therapy services for older people and adults with learning and physical disabilities. The council holds the budget for care packages and personal budgets, but People2People staff will continue to have “free-flow access” to it, Begley said.

Safeguarding, mental health and hospital social work will remain outside of the organisation for now, but Begley wants to see these services become more aligned with community social work and this is currently under discussion.

He’s also hopeful that the social work practice will take on additional functions in the future, such as the council’s employment service for people with learning disabilities, Enable.

“This would give People2People more strings to its bow, more opportunities to trade and develop as an organisation and more opportunity to create sustainability,” he said.

“There isn’t a wholesale absorption of everything into People2People, but we would expect a number of services to certainly explore that option going forward.

“We don’t want to sink the organisation, we want it to flourish, so it’s about considering whether it makes sense for those things to happen, or not.”

‘Care Act responsibilities’

People2People will continue to operate as a community interest company and will re-invest any profit into local communities and into the delivery of social care in Shropshire. This will enable the council to deliver its responsibilities under the Care Act.

Council minute papers said the company had been “extremely successful” in developing a robust social work practice model, which was now being replicated by other authorities.

Begley added: “This process was arguably quite uncomfortable at the start in terms of letting go of the reins to staff but actually they’ve worked hard to deliver this and it’s that independence that has delivered it. I haven’t witnessed a culture shift that has been so profound, has happened so quickly, and appears to be sustainable anywhere else.

“The biggest thing for us is that people no longer chase an assessment as a gateway for getting services. We don’t talk about eligibility anymore. The whole model is about an asset-based approach – let’s have a conversation and work out how to get support to you earlier and in lots of different ways that actually meet your outcomes.”