12 August 2009 - Department For Work And Pensions (DWP) Head Of Delivery Strategy Offers Guidance For Commissioning The Third Sector

Futurebuilders, the largest social investor in the UK, met up with Tracy Hughes to talk about the DWP commissioning process and how smaller organisations can prepare for large contract bids.

Hughes on:

Prime contractors

“We award contracts to ‘Prime Contractors’ – this means we give a large contract for a specific geographical area to a single organisation and they are fully responsible for delivery, working with a range of sub-contractors and partners to ensure each customer has a positive experience. We look for a range of skills and attributes from our Prime Contractors, including things like management capacity and capability, experience of delivering large scale provision, ability to effectively manage and develop supply chains and financial stability.”

The DWP procurement process

“We generally operate a two stage procurement process whereby we shortlist organisations using criteria around these and attributes and the organisations who best meet that criteria are then invited to submit a full tender.

Once an organisation gets through the short listing stage and is invited to tender, they need to convince us that they can deliver a high quality service to unemployed people in that particular locality. They are asked to provide details of their delivery model, how it addresses the specific needs in the contract locality, and all the sub-contractors and partners they are going to work with to ensure the needs of each individual customer are fully addressed. We take account of the skills and experience of the sub-contractors when judging the tenders, so it’s in the Prime Contractors’ best interest to work with well respected, experienced delivery organisations who can help them address the needs and barriers of each customer.”

Barriers to smaller organisations winning contracts:

“I think that there are some key barriers to small, third sector organisations bidding for any large government contracts, one of which is access to the financial backing needed to operate at that scale. There is certainly an issue that we have identified with third sector organisations potentially having the right experience and the right ethos but not having the ability to take the financial risks that would be needed. That’s why we’re encouraging third sector organisations to consider partnerships with other organisations in order to bring together finances, expertise and management skills. This could take the form of a new legal partnership or involve third sector organisations working with larger companies on a sub-contractor basis.”

Working in collaboration:

“(Smaller groups) could work with larger organisations as a sub-contractor, and indeed, many third sector organisations already operate on that basis. When we procured Provider Led Pathways to Work a couple of years ago, for example, we were successful in attracting around 300 third sector sub-contractors. Or they could form consortia with other providers to increase their capacity to bid as a Prime Contractor.

We would find it really exciting in future tendering rounds to receive a consortia bid involving a group of third sector organisations who are pooling their skills, experiences and resources to enable them to bid as a prime contractor and we’re certainly trying to support that process by giving them some independent access to expertise.”

The importance of third sector organisations:

“Quite often third sector organisations work at grassroots level, they understand the need of the individual and they have credibility that we at DWP and some of the larger providers simply don’t have. We are really keen to engage with them. We have done a lot to try and facilitate that engagement and ensure that third sector organisations continue to have a role in the delivery of Welfare to Work Services, and we are always very keen to hear people’s views on what more we can do.”

Support for smaller organisations who want to bid for DWP contracts is available, especially those interested in forming consortia.

For further information, visit the Futurebuilders website (opens new window)

Source: Futurebuilders 06/07/09