This article is part of a series and follows on from “Joining a MAT part 9 – Using Casual Staff” which talks through the various issues surrounding the use of non-teaching staff.

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At a time when schools are converting to academy status and Local Authorities are closing down or significantly reducing their support services many schools are turning to other providers for support with finance, IT, HR, cleaning, catering, etc.  We are the first to acknowledge that this can initially appear a complicated issue following recent changes to public Procurement rules, especially for smaller schools that have previously just taken the services offered by the Local Authority.  There are many organisations offering support with procurement and sometimes this type of help can prove invaluable if you are going through a procurement process for the very first time.

As a company offering services to schools we are frequently asked to respond to requests for information or to participate in a full blown tender process.  We find that some schools and academies that are moving away from Local Authority support for the first time often struggle with certain aspects of the process, such as defining the following.

• What they want to achieve as a set of outcomes e.g. combined financial, HR and payroll services.
• The type of service they are actually looking for e.g. consultancy and advisory services on a fixed price day rate or a full service contract with on-site support for staff for a fixed annual fee.
• What the process will be for the potential bidders e.g. pre-qualification questionnaire, written tender followed by competitive interviews.
• The service deliverables they expect e.g. a clear written statement of the type and range of service they are seeking.
• How success will be measured e.g. including an annual review in the scope of work.

We have written this advice note to suggest what would be helpful to potential suppliers to enable them to provide a service based on your current needs and aspirations.  Good procurement is a two way process so the better the information you provide the more likely you are to enter into a successful relationship with your new provider.

As a first step in the procurement process you need to determine the spending threshold.  This will be influenced by whether you are procuring the service as an individual school or as a group of schools, perhaps in an emerging or established MAT.  Once the value of the contract has been determined, this will decide what sort of tender process you need to put in place.  As an example, DfE guidance uses the following thresholds to define the type of purchase and, therefore, indicate the procurement process you need to adopt.

• Under £10,000 – low-value purchase.
• Between £10,000 and £40,000 – medium-value purchase.
• Over £40,000 – high-value purchase.

Spending thresholds are price boundaries.  If you are still a Local Authority school they may be different to the levels shown above due to locally agreed guidelines and can be found in your school or local authority’s procurement rules.  If you are already an Academy the thresholds above are appropriate to determine which method of procurement you use or, you may have your own guidelines linked to the schedule of delegation in your Academy or MAT guidance.

For a low or medium value purchase you can seek a range of quotes from relevant suppliers. For a high value purchase you should consider running a more formal tender process.  If the service is likely to result in a lifetime contract price over the European Union public procurement threshold of £164,176 then you will have to follow EU Procurement Directives and the use of professional advice is recommended.  That said, there are some “light touch” procurement guidelines for purchases that are specifically for education and you are advised to contact the DfE for guidance or seek legal advice. The threshold can be higher here, over £589,148.

Moving from a Local Authority service to a commercial provider can provide challenges for those senior leaders and governors involved in the process.  These can be linked to issues such as those listed below:

Price Comparisons

Although less common now than a few years ago, some Local Authority services still benefit from internal subsidies from the council and so may look, on the surface, to be better value than a commercial provider.  This makes it difficult to carry out a reasonable price comparison with a commercial organisation that is having to cover all of their costs from within the fee structure.  Look for quality and value for money rather than just a straight price comparison.

Service Comparisons

Services provided from the Local Authority may have changed only slowly over the years as the service also has to meet the requirements imposed on it by local custom and practice.    There may not be a current, up to date service specification or SLA that is responsive to the very different needs of a new academy or growing MAT.  Think very carefully if moving away from a Local Authority service about the type and range of services you will need in the future rather than just asking for more of the same.

Seek a more Contextualised Service

Schools that are used to Local Authority services will be familiar with a tiered level of service epitomised by Bronze, Silver and Gold levels.  Although many commercial services usually have a similar offer most are now used to responding to a local context and are happy to bespoke their service offer to match a client’s specific needs.  Be prepared to set out your requirements in a service specification and ask potential providers to respond to that in their proposals.  Ask for the service you want rather than accepting a service the provider wants to offer.

Value for Money

You may be simply carrying out an exercise to ascertain whether you are currently getting value for money (VfM) from your existing provider.  If this is the case it may be appropriate to carry out a comparison of prices but it is not about this alone.  It is also appropriate to consider what it is you require from the service and what you are currently receiving because not all providers will price their offer in the same way.  You may get much better response times for example from a new provider who on the face of it appears more expensive.  If this would save the school time and effort then the extra expense may be worth it.  An example might be where a new provider is offering a software solution that following its introduction may save hours of work in the academy office each week.  That could save a quarter of someone’s salary over a year freeing up time for something else.  Likewise if your new provider offers a same day response then consider that against the time taken in calling and following up with your present provider.

Service Specifications

However you seek to renew or refresh a service a clear ‘service specification’ or ‘scope of work’ for the provider to price against is critical to transparency.  At this point ask yourself a critical question.  Do we really need all the aspects of the service we are currently receiving?

For example, in HR tenders support for redundancy is often included in a service request, but how often does a typical school restructure?  It may be much more cost effective to specify the services that you know you will need and ask the provider to quote against that. At the same time negotiate a competitive day rate to be applied when support for a consultation on issues such as restructuring, job evaluations, redundancy, etc. is needed.

Whatever your motivation for procuring a new service provider the service specification provides the basic information the supplier will need.  After all you wouldn’t contact a garage and ask them to quote you for a car without offering them basic information such as: model, colour, engine size, fuel type, age, etc.  Therefore, taking HR as an example, basic information might include:

• how many staff you employ (many providers price on headcount);
• when would you like the new contract to run from;
• the number of staff on more than one contract;
• whether the service will be for advisory and consultancy services only or if some transactional support is also required;
• maximum expected response time for answering enquiries; and
• if payroll services are included.

In any event, if your requirements are changing, or are likely to change in the near future, for example you are converting to become an Academy or are forming a MAT, this type of information is essential to would be providers.  If you are a MAT with aspirations to eventually centralise certain services through internal appointments then a service that builds that capacity can be offered with tapering support over a period of time.  However, be clear at the outset that this is your intention so that providers can structure their offer accordingly.

Guidance on the Procurement Process

The guidance is also clear on process if you decide to tender for a larger contract e.g. if several schools are coming together as a MAT then all your bidders should be treated equally.  This means:

• the tender notice should go out to all potential providers at the same time;
• the scope of work required should be clear and detailed;
• the timetable for acceptance of bids and decision making should be outlined; and
• the criteria against which the bids will be judged should be described.

The post Joining a MAT Part 10 – Procuring Services appeared first on Enlightened HR.