1. Sheffield City Council Developing a Unit Price Model for In-house directly provided services Paul Brooke

2. Why? Having a Unit Cost (Gross budget divided by beds/clients/weeks) not fit for purpose in an SDS market. As a provider I needed a ‘price’ for my services that I could charge that was not dependent on the volume of the service I provide. I needed to know what it should cost to deliver a unit of service, not what my service does cost to deliver.

3. How? Identify a ‘chargeable unit’ – the product. What is it that I can say to a customer they are buying? For supported living we have used 1 hour of direct support. Identify who delivers it. Everything and everyone else is an on cost. Identify what is in and what is out. We have not included directorate and corporate on costs.

4. How? Use current service structures and budgets as a start point. We identified the staffing ratios and service overheads from existing services. Identify a ‘target’ price. We looked at the independent sector contract prices and considered our target market. Adapt the structure to deliver a Unit Price Persuade everyone to let you try!

5. The Unit Price Tool A simple spreadsheet uses 1 hour of direct support as the start point and costs the direct salaries and employer on costs. The proportions of management and administrative staff required to support frontline delivery are added. Operational on costs are added to give a Unit Price

6. The Unit Price Tool Price x Activity sets a budget and staffing establishment. The known or planned activity is entered for the scheme or service in hours. This generates a service budget with the income equal to the expenditure. Decisions can be made on recruiting to this service or grouping services to ensure activity (Income) matches the staffing hours recruited to.

7. Setting an Individual Service Fund This is reliant on people having an individual allocation of support hours. In our pilot schemes this is a combination of SP and Community Care funded support. Some people have ILF funded support that we are not providing. From the individual allocation some staffing resources are shared. Fixed and flexible resources are identified.

8. Setting an Individual Service Fund Unit Price18.86 FlexibleDirect Support11.12 Shared FundCover fund2.31 FixedDirect Management3.52 Overheads1.91

9. Setting an Individual Service Fund People will get a monthly statement showing the direct support hours (both shared and individual) that they have used. It will state what the ISF has been spent on. Training and recruitment support as well as specific planning activity and advocacy will be shown.

10. Issues to resolve Using ‘banked’ hours or unused funds – we are likely to support flexible use of staffing allocation within an agreement covering notice - but not ‘cashable’ funds LA accounting for scheme funds carried from year to year. Buying additional support – what price can we offer additional hours at – overheads and mgt are covered in main scheme.

11. Enabling flexibility – resource allocation is based on need per week/month not life. Shared support restricts individual flexibility. Can we as a provider deliver contract flexibility with the workforce? Funding now reliant on provider activity – creates risk and instability within a risk averse and inflexible corporate structure. Issues to resolve

12. But……… Staff motivated to be ‘The Provider of Choice’. Service development based on attracting customers. Individual accountability for cost.