Meeting documents
Cabinet
Wednesday, 7th February, 2007
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Bath & North East Somerset Council |
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MEETING: |
Council Executive |
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MEETING DATE: |
7th February 2007 |
AGENDA ITEM NUMBER |
12 |
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TITLE: |
Transfer of Connexions to a Local Authority controlled company |
EXECUTIVE FORWARD PLAN REFERENCE: |
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1575 |
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All |
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AN OPEN PUBLIC ITEM |
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List of attachments to this report: Appendix 1. Statutory Provisions related to Connexions Services Appendix 2. Connexions West of England funding, people and liabilities Appendix 3. What is a controlled company? |
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1 THE ISSUE
1.1 Connexions West of England currently delivers a range of services to 13-19 year olds on behalf of the Secretary of State for Education and Skills. The key statutory functions delivered by the service are:
> Providing career education and guidance (Employment and Training Act 1973: Trade Union Reform and Employment Rights Act 1993)
> Encouraging participation in education and training (Learning and Skills Act 2000)
> Supporting post 16 transition for young people with learning difficulties and disabilities (Learning and Skills Act 2000)
1.2 Responsibility for ensuring the statutory provisions of the national Connexions service is being transferred to local authorities by 2008 at the latest. This report sets out the revised arrangements by which this change can be achieved for the Connexions West of England Service thereby securing continuity of service to young people and schools in Bath and North East Somerset.
2 RECOMMENDATION
Given this legal requirement the Council Executive are asked to confirm specific arrangements as follows:
2.1 Responsibility transfers to Bath and North East Somerset Council as one of the four local authorities on 1 September 2007 for ensuring statutory duties are met and the Connexions specification is delivered. This means that the Council assumes responsibility for the service in advance of the 2008 deadline and discharges this responsibility through the commissioning of a service from Connexions West of England.
2.2 The Connexions service for Bath and North East Somerset Council continues to be provided by Connexions West of England and that its status be changed to a local authority controlled company from 1 September 2007 (see Appendix 3 for explanation of a controlled company).
2.3 Bath and North East Somerset jointly with the other three local authorities takes over Connexions West of England and the local authorities collectively hold the majority vote.
2.4 The Executive or delegated appropriate group nominate to the Board two individuals who will act as Directors on the Connexions West of England Board, one of these would normally be the Director of Children's Services.
2.5.1 The Board develop existing work to deliver the outcomes required in order to meet statutory requirements and deliver the Connexions specification(Appendix 2).
2.5.2 The Strategic Director for Children's Services be authorised to take any steps necessary to implement the Executive's decision.
3 FINANCIAL IMPLICATIONS
3.1 It is understood that government funding for the service will be in the form of a specific grant to each Local Authority. If the authority, in partnership with the 3 adjoining authorities (Bristol, North Somerset and South Gloucestershire), use this funding to deliver a controlled Connexions company and manage the services within the level of funding provided, there should be no net financial implications for the local authority. Future levels of funding are expected to be in line with current allocations made directly to Connexions West of England. The Local Authority would transfer the grant to the company which would be responsible for delivery of the specified services within that budget. Any overspends would be contained within the company and subject to a recovery plan. Underspends would be retained for planned re-investment.
3.2 A joint solution is dependent on the continued agreement of
all four unitary authorities which currently receive the Connexions
West of England Service. All four authorities are committed to
retention of Connexions West of England as it provides a service
tailored to the needs and requirements of each authority. All four
authorities have committed to this arrangement for three years
subject to one year notice of termination.
3.3 It is important to ensure that any entity remains part of
the local government sector, and a joint arrangement for the
delivery of functions. Otherwise it is possible that future
developments in EU law may require it to be tendered.
3.4 If the existing Connexions organisation continues as proposed in the report and is restructured, its employees will remain employed by it. If a new entity is established to take over its activities, it should be assumed that Connexions staff will transfer to that entity and TUPE (and associated costs and liabilities) will apply. If Connexions is currently classed as part of the public sector, all those bodies involved will be expected to meet the requirements applicable to staff transfers within the public sector.
3.6 Further legal advice is being sought on the technical process required to change the Connexions West of England Company into a controlled company. The costs of which will be met from within existing Connexions West of England resources.
4 COMMUNITY STRATEGY OUTCOMES
> Sharing resources, working together, and finding new ways of doing things
> Improving local opportunities for learning and gaining skills
> Improving our local economy
5 CORPORATE IMPROVEMENT PRIORITIES
> Improving life chances for disadvantaged teenagers
> Developing a sustainable economy
> Improving customer satisfaction
6 CPA KEY LINES OF ENQUIRY
> Improving engagement with and a range of services for Older People and Children and Young People
7 THE REPORT
7.1 Context
7.1.1 Connexions West of England deliver a range of services for teenagers on behalf of the Secretary of State for Education and Skills. These services are provided under the duties and powers contained in the Employment and Training Act 1973 (Appendix 2), the Trade Union Reform & Employment Rights Act 93 http://www.opsi.gov.uk/acts/acts1993/Ukpga_19930019_en_1.htm and the Learning and Skills Act 2000 http://www.opsi.gov.uk/acts/acts2000/20000021.htm.
7.1.2. Responsibility for ensuring the statutory duties are fulfilled and for securing delivery of the service is to be transferred to this local authority in common with other education authorities. The funding for these services will also be routed through the Council. The Council and the Connexions Partnership can determine at local level the date for these changes, but it must be by 1 April 2008 at the latest. Proposals to be enacted prior to 1 April 2008 require agreement of the local authority and the Connexions Partnership and the endorsement of the Government Office.
7.1.3 The current Connexions service is a successful and integral partner in the delivery of the Children and Young People's Plan and proposed Local Authority Agreement (LAA). Good progress is being made on achieving the target of reducing the number of young people not in employment, work or training (NEET).
7.1.4 There is no other organisation which is readily available with an evidenced track record of good quality, externally assessed leadership, management and delivery that could guarantee continuation of the service at this crucial time.
7.1.5 Any change from the existing service is likely to cause an implementation drop which may have implications not only for the quality and quantity of statutory services to young people, but also to our ability to deliver associated LAA targets.
7.1.6 Many teenagers travel across unitary authority boundaries for education, training and employment. This joint approach prevents young people from falling through the net.
8 RISK MANAGEMENT
8.1 The report author and Lead Executive member have fully reviewed the risk assessment related to the issue and recommendations, in compliance with the Council's decision making risk management guidance.
8.2 The proposed option presents the least risk for the Local Authority, as it limits and manages liabilities to the local authority as described in appendix 3; maintains the collaborative infrastructure required to track and support young people for each of the 4 Local Authorities; and sustains high quality service and positive and improving outcomes for young people.
8.3 Whilst this joint solution is dependent on all 4 unitaries agreeing, the current proposal has been jointly developed; risk assessed and is the agreed way forward. The controlled company model is recommended by all parties, including the Board of the Connexions West of England. The Company will be amended so that it is changed from a Memorandum and Articles of Association not for profit company limited by guarantee which is not controlled, to a controlled local authority company.
9 RATIONALE
9.1 All four local authorities are in agreement that a joint body should be established. This is proposed on the basis that:
9.1.1 OfSTED have confirmed that Connexions offers good value
for money
9.1.2 The Connexions organisation has expertise and significant experience in achieving objectives and targets through multi-disciplinary working. Their plans, priorities and services are in partnership with the local authority and are therefore already in line with our services.
9.1.3 Controlling Connexions West of England enables the authority to deliver the service it requires without taking on any existing or future liabilities.
9.1.4. Teenagers receive integrated universal and differentiated services that meet their needs that support them to achieve economic well being without any break in service.
10 OTHER OPTIONS CONSIDERED
10.1 Each Local Authority procures separately or jointly the specification of
Connexions service.
10.1.1 This would require the dismantling of the current integrated infrastructure held by Connexions West of England because of data protection and confidentiality issues. Data systems for 13-19 year olds would need to be re-established, along with functions required for the numbers of 13-19 year olds crossing borders daily for their education; there would be a potential loss of service whilst structures are dismantled and new cross border arrangements negotiated; and a risk of loss in performance affecting PSA / LAA targets.
10.1.2 A regional approach has proved beneficial in aiding the four local authorities to deliver statutory requirements as it provides economics of scale and access to specialist skills and services that smaller services would find it difficult to provide cost effectively. Joint procurement processes could lead to a potential loss of the quality assured service with a consequent detrimental impact on achieving positive outcomes for young people.
10.2 Authorities may choose to bring the service in-house.
10.2.1 In addition to the reasons given above, if the Council determined to TUPE the existing staff this would bring immediate costs in undertaking this transfer as well as longer term potential liabilities linked to staff, pension and property costs. The size of this authority would mean that there would be no economies of scale and therefore the same level of current service could not be guaranteed.
10.3 Continue to use the organisation Connexions West of England with
existing status and relationship.
10.3.1 There is a significant possibility that this option might be open to challenge from external organisations under EU procurement rules.
11 CONSULTATION
Each Local Authority in the West of England area is represented on the Board of
Connexions West of England. Government Office has consulted with the Board as a
whole, and individually with Chief Executives, Executive Members and Directors of Children's Services across the 4 unitary authorities. Consultation has focused on how
best to integrate Connexions into local authority management whilst maintaining
positive outcomes for teenagers and ensuring PSA / LAA and other targets are
achieved. From this consultation a collective preference has emerged for all four local
authorities in the area to establish a controlled company. This preference has the full
support of Government Office South West (GOSW).
ISSUES TO CONSIDER IN REACHING THE DECISION
Connexions West of England has a good track record of supporting vulnerable young
people, e.g. young people with learning difficulties, care leavers and teenage mothers.
The implications of not working with this proposal would be detrimental to targeted
groups as well as outcomes for all teenagers in the period of time taken to procure,
establish and deliver an alternative service.
12 ADVICE SOUGHT
The Council's Monitoring Officer (Council Solicitor) and Section 151 Officer (Strategic Director - Support Services) have had the opportunity to input to this report and have cleared it for publication.
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Contact person |
Ashley Ayre. Telephone 01225 394200 |
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Background papers |
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