Agenda item

Report of Corporate Director for Adult Social Care and Health

Deborah Cole, Interim Commissioner, presented the report and stated the following:

 

a)  the report incorrectly lists Councillor Jay Hayes as the Executive Member with responsibility for this proposal, when it should state ‘Councill Neghat Khan, Executive Member for Adult Social Care’;

 

b)  the report sought approval to procure a Virtual Wallet Solution, via Crown Commercial Services, for the delivery of a Direct Payment Service for Nottingham City Council;

 

c)  ‘Virtual Wallet’ is an easy-to-use solution that enables local authorities and NHS organisations to deliver true choice and control to individuals as it simplifies the personal budget process for the funding authority, the individual and their care providers. It also prevents fraud, waste and mistakes, ensures compliance, and saves money. There is also more transparency and control than a pre-paid card solution, and it addresses the lack of Financial Conduct Authority compliance associated with most third-party ‘managed account’ solutions;

 

d)  the service will offer a new holistic approach, bringing together a number of service offers which are currently accessed on an individual basis. It will provide an opportunity to establish a long-term, digital-first, offer that further enables local eligible individuals to access personalised care and support, thereby maximising choice and control and promoting self-directed support planning;

 

e)  Some of the issues / limitations associated with our current model are:

 

  i.  numerous providers, resulting in confusion over the scope of services provided;

  ii.  lack of Monitoring of Direct Payment;

  iii.  top-up payment (FA and Fairer Charging) lack of clarity, and top-up payments not routinely occurring;

  iv.  cost of service delivery more than commissioned service;

  v.  limited buy-in from professionals;

  vi.  lack of Audit;

 

f)  Benefits of the proposal:

 

  i.  to individuals (and/or their nominated representative):

 

·  24/7 real-time access and transparency;

·  no need to open / operate a bank account;

·  no need to maintain / submit receipts;

·  quicker, more timely response and access to support;

·  first-line support service;

 

  ii.  to providers and Personal Assistants:

 

·  ease of access to the eMarketplace and a level playing field to promote their offerings;

·  one consistent way of dealing with direct payments;

·  efficient, automated self-billing creation of invoices;

·  guaranteed payment for products / services provided (no bad debt risk);

·  swift payment;

 

  iii.  Nottingham City Council:

 

·  legislative compliance achieved;

·  eliminated overspend and prevents misspend, fraud, waste, and abuse;

·  full transparency and audit trail of spend at a detailed level (with real-time reporting), minimising audit effort;

·  encourages market diversity and provides market management information;

·  automated clawback of unused funds (in 2024-25, we have already clawed back over £900,000);

·  scalable model with volume-based discounts up to 50%;

·  low cost and low risk commercial model;

 

g)  this arrangement will enable Nottingham City Council to meet its statutory duties whilst also ensuring that Best Value is achieved.

 

Resolved to

 

(1)  approve spend of up to £1,491,728, over a maximum 4 years (2+1+1), on procuring a Virtual Wallet solution, via Crown Commercial Services, for direct payment for citizens with an assessed need under the Care Act 2014, with a commencement date of March 2025;

 

(2)   delegate authority to the:

 

(a)  Director of Commissioning and Partnerships to approve the award of contract;

 

(b)  Head of Commissioning, Contracts, Quality and Personalisation to sign the contracts and any extensions relating to the service.

 

Reasons for recommendations

 

a)  The Care Act 2014 and the Children and Families Act requires local authorities to offer adults and children who are eligible for funded care and support in line with the relevant eligibility criteria to take all or some of their personal budget as a Direct Payment.

 

b)  Approval is sought to procure a Virtual Wallet Solution (using crown commercial services digital platform framework) for the delivery of direct payment service, that is citizen focused and promotes self-service.

 

c)  Virtual Wallet supports local authorities to deliver direct payments and one-off payments. The funding organisation makes one simple payment into the Virtual Wallet central fund and budgets are then allocated to individuals. The individual is then able to choose, book and buy care, support and products to meet their specific needs. Virtual Wallet then automatically processes payments to the providers and personal assistants.

 

d)  Virtual Wallet also enables robust financial monitoring and complete transparency on budget spend for all parties. It also enables individuals to continue to have choice and control over their care and support, without the hassle of having to make payments themselves or send in receipts.

 

e)  The Virtual Wallet solution has been reviewed and accredited by NHS England as part of its review of personalised care tools.

 

f)  It is recommended that the contract be awarded for 2+1+1 years (the service will be monitored on a regular basis (quarterly) to ensure that it is performing effectively and is appropriately utilised).

 

Other options considered

 

a)  Extend the current framework agreement - this was rejected as it has been established that this approach is not able to meet the needs of citizens and does not meet all statutory requirements.

 

b)  Procure a Direct Payment Service, delivered by a singular provider, using the full tender procurement process - this was rejected as a direct payment service delivered by a singular provider using any of the above procurement route has the potential to simplify service delivery and improve integration. However, it also carries risks related to choice autonomy, competition, and accountability. Balancing these factors would require robust oversight and ensuring that service users retain meaningful control and options within the system. It is also important to note, that this route takes a longer time, and additional resources.

 

c)  Procure a Direct Payment Service, delivered by two providers, with each responsible for all services using the full tender procurement process - this was rejected as this offers a mix of benefits and challenges. A direct payment service delivered by two providers offers a balance of specialisation and flexibility, however, the trade-offs include increased complexity, potential coordination challenges, and higher administrative costs. For this model to work effectively, strong communication and coordination between the two providers are crucial to avoid service gaps, delays, or confusion. Service users will need clear support in managing the relationships with both providers to ensure that their direct payments. It is also important to note that this route takes a longer time, and additional resources.