Green light given for Children’s Services Trust outsourcing proposals

Moves to outsource children’s social care services in Birmingham progressed after the Council Cabinet yesterday gave the green light for detailed proposals to be drawn up for either a wholly owned company or an employee owned mutual to run the care services.

While the Council would retain full legal responsibility an independent trust would run the services on its behalf. The Trust proposals will potentially affect 1,200 employees whose employment would be transferred out of the Council.

Both Trust models would have the future option of becoming Community Interest Companies. The Cabinet will consider a further report in January which will include detailed costings and further evaluation of the two models and will receive feedback on negotiations with the DfE on help with the significant start up costs. In January 2017 the Cabinet will decide on whether to abandon or proceed with the Trust plans.

The Council argues that only an independent trust can ensure the necessary improvement in children’s services in Birmingham which have been the subject of Government and OFSTED concern for nearly ten years. The claim is that a Trust arrangement will provide greater freedoms and flexibility to develop services than if they remain within the Council and will allow an exclusive focus on social work with children and families.

There is still no decision as to whether care services for disabled children will sit within the Trust or in Adult social care or possibly the Education department.

Birmingham City Council has decided to voluntarily pursue the Trust option at a time when the Government has announced its intention to force other poorly performing local authorities to move their social care services out of Council control. The Government has recently said that it expects that by 2020 that up to a third of local authorities will no longer directly provide children’s care services and that different models of delivery will be in place.

The setting up of an independent Trust is likely to involve significant cost. At today’s Children and Families Scrutiny Committee, Peter Hay, the Strategic Director for People, said that there would need to be a Programme management team in place, and identified the costs for recruiting and paying the Trustees & Chair. Hay refused to identify the actual costs but said the Council is seeking funds from the DfE to cover these setting up costs. This comes at a time when the Council is moving forward with plans to close Children’s Centres and cut Early Years services by £5m per year.

Although the Council initially claimed that the Trust option might allow more attractive terms and conditions to be offered to recruit and retain social workers this now appears to have been ruled out. Making the case for the Trust to the scrutiny committee Peter Hay’s main claim was that it would allow the Council to be a more effective commissioner of services – unencumbered “by provider interests”.

But the space between the Council and the Trust will now be filled by a new Commissioner-provider relationship and by a new Trust Board arrangement creating another tier of management.

Hay cited the example of the outcome of a recent positive OFSTED inspection of the Doncaster children’s trust while ignoring the examples of Local authorities such as Cornwall and Leeds which have significantly improved their children’s services while retaining them within the Council.


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