(1) To approve the proposals set out in paragraphs to ensure greater transparency of partnership board activity; and

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1 Agenda Item No. 7 Governance Committee 23 November 2015 Partnership Governance for Contract Management Report by Director of Law Assurance and Strategy Executive Summary This report sets out some areas for consideration in further developing the approach to the governance of the County Council s commercial and contractual arrangements. It explains changes made in 2013 in preparation for the increased role for elected members in commissioning activity. Among the changes was the introduction of partnership boards for the bigger contractual arrangements. The constitutional position is set out at Appendix 1. One partnership board is in place for the Capita contract and its governance is set out in Appendix 2. The report invites the Committee to consider ways of making the current arrangement more transparent and for reviewing the use of partnership boards and their extension to other areas of contracting using the model described in the diagram at appendix 3. Recommendations (1) To approve the proposals set out in paragraphs to ensure greater transparency of partnership board activity; and (2) To consider whether there should be a review of partnership board arrangements for contract governance and how such a review should be undertaken. 1. Introduction 1.1 As part of the plans for the County Council s increasing role in commissioning many of its services there was a full review of the role elected members should play in the Council s commissioning activity. In anticipation of the new Council in May 2013 the County Council amended the arrangements for Select Committees to play a role in contract oversight by receiving standard information and key performance indicators for contracts within their remit through their Business Planning Group (BPG), and to provide scrutiny of the systems for contract management. 1.2 At the same review of member roles the County Council, at its meeting in March 2013, introduced the concept of the Partnership Board - a panel of

2 elected members sitting with senior representatives of a major service supplier to the Council in order to provide strategic guidance and assist planning for the longer term contractual relationship. 1.3 This Committee, at its meeting on 4 March 2013, approved a plan to amend the role of members to include a focus on performance management. The Council s Constitution was amended to provide a definition of a Partnership Board and for the details of any Board to be published in the Members Information Service (Standing Order 59(3)) (see Appendix 1). Only one such Partnership Board has been established that for the Capita contract for the Council s administrative back office functions. The detailed governance for that board is set out at Appendix Discussion 2.1 Whilst the Partnership Board for the Capita contract has operated effectively and has discharged a valuable role in the oversight of the contractual relationship and future planning, it has not had the level of transparency that was originally planned. There is therefore a need to consider whether further changes are needed to the approach or to the way the Partnership Board s activity is managed and, in particular, to achieve greater member awareness and engagement. 2.2 The diagram in Appendix 3 provides an overview of the member role in the commissioning cycle and indicates where partnership governance is placed in the run and review phase alongside the Cabinet and scrutiny. Whilst Select Committee and Cabinet Member activity is well understood and transparent, the work of partnership governance requires both wider use and greater transparency. 2.3 The recent review of the contracts for support services and IT with Capita has highlighted the need to reaffirm some elements of governance and to provide much more transparency. It is however a good example of member involvement in the strategic direction and overview of a major contract. It would be useful to see whether and how such an approach could be used elsewhere. 3. Proposals for Transparency 3.1 There is already a commitment to publish the membership of any partnership board and for any minutes or action plans to be made available to members. The detailed governance arrangements for each board will continue to be settled by the members appointed, jointly with those representing the partner commercial organisation so that it can meet the expectations of both partners. There is a need to ensure members are aware of the activity of such partnership boards so that members, either as individuals or through their roles on Select or other committees know what information they can call for and how to do so. This could be done by ensuring that agendas are published on the Members Information Network database. Members or Select Committee

3 BPGs can call for additional information such as minutes or action plans as need be. 3.2 This would help complete the cycle between member involvement in designing outcomes and in ensuring the outcomes are delivered. This would also mean that key plans for information about the contracts could be more accessible. It should also support increased member engagement in the broader governance of major contracts. Each Select Committee should be invited to plan dates for oversight of those for the relevant Select Committee. The Regulation, Audit and Accounts Committee may also wish to consider a similar arrangement. Other contracts to benefit from partnership governance 3.3 It may be useful to undertake a review of current contractual relationship and planned contracts to explore the value of a partnership approach to their governance. This could include criteria against which contracts were assessed such as corporate significance of outcomes; total contract value; impact on key objectives etc. This could then be considered as part of the contract set up to ensure that governance for contract management is written into the contract. This would make clear to the partner how oversight and scrutiny of the services would work within the Council. Different approaches could be taken in different cases. 3.4 For example a one-off Board could be convened to review at a mid-point of a contract identified as critical at the outset. A flexible and outcome driven approach would help ensure that the governance model is proportionate to the requirement for transparency and assurance and did not become overly bureaucratic. It will be important to determine whether it is possible to seek this type of governance arrangement with contracts already in place. Membership and the roles of members 3.5 The current arrangement is for the relevant Cabinet Member to appoint up to four members (cross party) to sit alongside those appointed by the partner. There are no specific criteria but appointments should be informed by relevant skills, experience and interest. It may be useful to adopt more flexible arrangements if the approach is to be extended. 3.6 In order to achieve consistency and effectiveness a standard set of core governance attributes to support good practice would help. This could include core terms of reference, escalation routes, performance and customer satisfaction models and simple lines on relationship management, roles and responsibilities. 3.7 The work on designing partnership governance would need to ensure clear lines between collaborative contract management and the need for robust challenge and scrutiny. The relationship between any partnership board and the relevant Select Committee would need to be better set out.

4 4. Proposed Next Steps Further work will be undertaken on the options for a partnership approach for additional and future contractual relations. The Committee is invited to indicate how members should be involved with that work, perhaps through a task and finish group reporting to the Leader and Cabinet Member for Finance. In the meantime the Committee is invited to agree the proposals for clarifying the current arrangements and action for improving their transparency. 5. Resource Implications and Value for Money None 6. Equality Duty An Equality Impact Report is not required for this decision because it is a report dealing with internal or procedural matters only. 7. Risk Management Implications None. Peter Lewis Executive Director Corporate Resources and Services Tony Kershaw Director of Law Assurance and Strategy Contact: Linda Corn, Background Papers None

5 Appendix 1 Partnership Boards 7. Partnership Boards 7.1 A panel of up to four members (cross party) appointed by the relevant Cabinet Member to sit alongside the relevant senior officers of the Council on a specially constituted Board with senior representatives of a contractor or partner from whom services are to be procured. The Cabinet Member will decide which contractual relationship would be assisted by such a Board. 7.2 The Board will oversee the development of the commercial relationship and service planning with the contractor and will monitor effective performance against the outcomes sought and the specified performance measures for the contract. 7.3 The minutes and action plans prepared by the Board shall be available for all members. 7.4 The terms of reference and detailed governance arrangements for each Partnership Board shall be agreed by the members appointed in discussion with the representatives of the contracting partner and shall be made available to all members.

6 Appendix 2 Capital Partnership Board Detailed Governance of Capita Partnership Board The Partnership Board takes overall responsibility for the development of the Partnership and associated activities. It provides strategic advice and guidance, ensures priorities are aligned and provides direction to all other Boards. 1.0 Terms of Reference The terms of reference for this board are: i. Oversight of the Service Provider Partnership; ii. Decisions such as take-on of new services, policy changes and service adjustments; iii. Set outcomes for service delivery and review performance against outcomes and operational benefits ensuring value for money; iv. Review the annual Relationship Management Plan; v. Provide direction and co-ordination to the Operations Board; vi. Responsibility for the scrutiny and audit of the delivery of all services associated with the contracts within its scope; vii. Providing decisions on the growth, expansion and reduction or service adjustment of the contract(s) and to invoke (if circumstances were to lead to it) termination; viii. Be the point of escalation for the other Boards; and ix. Be the escalation path to the Council Chief Executive Board and to Service Provider's Executive Board. 2.0 Frequency of Meetings The Partnership Board will meet every month in the first year of operation and subsequently every 4 months. All meetings will be scheduled to provide an information flow upwards to the relevant Boards. 3.0 Governance Papers In preparation for the Board, reports will be circulated electronically to Board members at least one week in advance of each meeting. The governance package will consist of the following documents: i. Agenda ii. Minutes and actions arising from the previous meeting iii. High level timeline (highlighting transition deliverables) iv. Progress update for all services within scope. v. Summary of Performance Reports The governance package will also include any other additional items that are referenced in the agenda. 4.0 Structure and Membership of the Partnership Board Executive Director Corporate Resources and Services (Chair) County Council Members appointed Head of Commercial Services Business Development Manager

7 Capita Capita Capita (Optional) Director Local Government Services Partnership Director Head of Local Government Services Chief Operating Officer 5.0 Rules of Engagement Each party shall ensure that its Board Members make all reasonable efforts to attend Board meetings. If any Board Member is not able to attend, that person shall use all reasonable endeavours to ensure that: i. A delegate attends the relevant Board meeting in his/her place who (wherever possible) is properly briefed and prepared; and ii. That he/she is debriefed by such delegate after the Board Meeting. The chair for a Board meeting will alternate between each party. Each party will appoint a chairperson for the relevant Board meeting. The chairperson shall be responsible for: iii. Scheduling Board meetings; iv. Setting the agenda for Board meetings and circulating to all attendees in advance of such meeting; v. Chairing the Board meetings; vi. Monitoring the progress of any follow up tasks and activities agreed to be carried out following Board meetings; vii. Ensuring that minutes for Board meetings are recorded and disseminated electronically to the appropriate persons and to all Board meeting participants within seven Working Days after the Board meeting; and viii. Facilitating the process or procedure by which any decision agreed at any Board meeting is given effect in the appropriate manner. Board meetings shall be quorate as long as at least two representatives from each party are present. The parties shall ensure that all Boards resolve the issues and achieve the objectives placed before them. Each party shall use endeavours to ensure that Board Members are empowered to make relevant decisions or have access to empowered individuals for decisions to be made to achieve this.

8 Appendix 3 Wider member involvement in the commissioning process Cabinet Member/Board Wider Member Involvement Local member(s) All member event & or CLC(s) TFG (set up by Cabinet Member or Select Cttee) Referral to Select Committee Setting Outcomes Select Committee decision preview Design Decision & Procurement Cabinet Member decision Local Member/CLC Feedback Partnership Board Run & Review Cabinet Member Accountability Select Committees Cabinet Board