Source · Select Committees · Public Accounts Committee
Recommendation 12
12
Accepted
Department reset programme, separating transformation from service; testing with contractors still required.
Conclusion
In order to deliver the new service from 2029, the Department told us it needs certainty over the design of the new health assessments service by 2027 to either procure the new 12 Qq 45–46 13 Q 47 14 Q 76 15 Q 12; C&AG’s Report, para 3.14 16 Q 22; C&AG’s Report, figure 10 17 Q 1; C&AG’s Report, para 3.21 18 Q 25; C&AG’s Report, para 2.10 19 Qq 25–26; C&AG’s Report, para 2.10 12 Revising health assessments for disability benefits services from contractors, or allow it sufficient time to bring the service in-house.20 The NAO found that, to date, the Department had focused on building the digital system to manage cases and had not set out what evidence it needed for the test and learn activity to understand how the health assessment service it is designing is working.21 The Department recognised that it had made a mistake early on in the programme, between 2018 and 2019, where it thought it could incorporate the transformation it wanted to achieve from the Programme into the procurement of the new contracts. It told us that its procurement timetables meant that this was not possible. As a result, it reset the programme so that it was able to separate out the initial transformation activity from the day to day running of its functional assessment services but still have contractors involved in both.22 However, the Department told us it will need to work with the new contractors and its evaluation team to understand where in the country it needs to test the health assessment service to assure itself that it gets the data and information it needs to be able to assess the success of the transformed service.23 Monitoring progress
Government Response Summary
The government agrees with the Committee’s recommendation and states that the Functional Assessment Service (FAS) contracts contain specific contractual levers and mechanisms to enable the supplier involvement required to support transformation.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. Recommendation implemented 4.2 The Functional Assessment Service (FAS) contracts contain specific contractual levers and mechanisms to enable the supplier involvement required to support transformation. This includes test and learn activity and the expansion of the new Health Assessment Service (HAS). Suppliers are incentivised strategically by being a partner in the development of future services, and through mechanisms such as gainshare where suppliers share the rewards that transformation drives. 4.3 Competitive advantage by incumbent suppliers can never be completely overcome, but the department will mitigate this through market transparency and robust procurement processes to encourage competition and increased participation. The department has demonstrated the ability to achieve this in the recently awarded FAS contracts, with two new suppliers. 4.4 The department’s future health commercial strategy will be developed from 2024, putting the department in a strong position to replace services in 2029 and commence transformed services. The strategy will follow Sourcing Playbook best practice, considering the department’s role and interaction with the Market, through application of a delivery model assessment. It will focus on understanding the role of suppliers in the transformed HAS, including whether any element would be best delivered directly by the department; development of the right marketplace for those services, transparency of information with that market as the department continues to develop HAS, the opportunity for market input to the development of services in readiness for procurement, and how best to procure future services. 4.5 The strategy will also explore new contracting mechanisms offered by new UK Procurement Regulations that the department expects to provide more flexibility for contracting authorities in such complex procurements.