Commissioning

"Commissioning - the cycle of assessing the needs of people in an area, designing and then securing an appropriate service."
Partnership in Public Services: An action plan for third sector involvement

What is Commissioning?

Public services are increasingly becoming commissioners of local services. Commissioning is the process of identifying what public services are needed locally and deciding how resources will be allocated to deliver those services. Commissioning is not just a question of buying services. It involves a number of steps including understanding local need, identifying potential providers, designing services, deciding how to resource the service and choosing a supplier. Once the service has been commissioned, it should be monitored and this information used to inform future decisions.

The move towards commissioning and the way that services are commissioned has a significant effect on third sector organisations. Public service commissioners in Doncaster include Doncaster Council, NHS Doncaster, South Yorkshire Police and a number of other organisations involved in Doncaster's Local Strategic Partnership.

The Eight Principles of Good Commissioning

The government has identified eight principles of good commissioning, outlined in their National Programme for Third Sector Commissioning. They are:

  1. Understanding the needs of users and other communities by ensuring that, alongside other consultees, you engage with the third sector organisations, as advocates, to access their specialist knowledge;
  2. Consulting potential provider organisations, including those from the third sector and local experts, well in advance of commissioning new services, working with them to set priority outcomes for that service;
  3. Putting outcomes for users at the heart of the strategic planning process;
  4. Mapping the fullest practical range of providers with a view to understanding the contribution they could make to delivering those outcomes;
  5. Considering investing in the capacity of the provider base, particularly those working with hard-to-reach groups;
  6. Ensuring contracting processes are transparent and fair, facilitating the involvement of the broadest range of suppliers, including considering sub-contracting and consortia building, where appropriate;
  7. Ensuring long-term contracts and risk sharing, wherever appropriate, as ways of achieving efficiency and effectiveness; and
  8. Seeking feedback from service users, communities and providers in order to review the effectiveness of the commissioning process in meeting local needs.

Grants, Contracts and Other Delivery Methods

An effective commissioning process will consider a range of delivery methods. This includes considering in-house provision, providing direct payments to individual service users to buy the services they require, offering grants and procurement using external providers. Procurement is the term used to describe a specific method of purchasing services which results in a contract.

Local authorities and other public bodies are able to offer grants to third sector organisations as well as procuring goods and services by entering into contracts. There are no specific rules about which funding method should be used and there are a number of contributing factors, but the National Audit Office and the Treasury have provided some guidance.

A grant maker is offering financial support in an area of work designed and proposed by the third sector organisation that it wishes to sponsor. In general a grant is favoured where:

  • Activities are aligned with the wider objectives of the public body
  • There is a desire for innovative or experimental products or services
  • Outcomes rather than outputs are to be specified

Procurement will tend to be used where outcomes are relatively specific and it is important to minimise the risk associated with delivering a public service.

Because of the move towards procurement, it is important that third sector organisations are as 'contract ready' as possible.

Opportunities and Where to Find Out More

You can find out more about current commissioning news and contract opportunities, along with other funding news, by visiting our Funding and Finance News page. NAVCA, NCVO and Anthony Collins Solicitors LLP have produced a very useful guide to procurement law  titled 'Pathways Through the Maze'.

For further guidance on commisioning: