Transforming Rehabilitation: The MoJ's probation shake-up must not treat charities as "bid candy"

Experienced rehabilitation charities say they have been left disadvantaged by the bidding process for the Ministry of Justice's probation overhaul

The National Audit Office (NAO) has delivered its verdict on the early days of Transforming Rehabilitation, the Ministry of Justice’s ambitious attempt to shake-up the probation system. As watchdog reports go, the MoJ will probably be pretty relieved.

Transforming Rehabilitation doesn’t get a clean bill of health — probation staff raised with the NAO concerns about workload and professional relationships, as CSW reported — but the report’s tone is generally positive.

Amid substantial changes, with responsibility for managing ex-offenders split between new community rehabilitation companies (CRCs) and the national probation service, services were found to have been sustained successfully. Officials are praised for its handling of the 21 CRC contracts.

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The NAO also refer, briefly, to the charities which bid for prime contracts. "Voluntary bodies were largely unsuccessful," its report concedes, "due to their more limited resources and appetite for risk". But this account feel partial at best.

Here at New Philanthropy Capital we know, from work we have done with rehabilitation charities over the last two years, that there was significant disquiet in the voluntary sector about how this process unfolded for them.

Charities had been directly encouraged to apply to act as prime providers, including a senior MoJ official speaking at NPC’s annual conference in 2013 to emphasise how keen the department was to have some not-for-profit organisations in those roles.

Ultimately, though, 20 of the 21 prime contracts went to private providers, and one to a mutual led by probation staff. Some charities have been sub-contracted by the prime providers, but the involvement is far more limited than anticipated.

The whole thing, explained one charity involved, was "chaotic and confused"

NPC published a short account of those frustrations after we convened a discussion with major rehabilitation charities to reflect on what had gone wrong. All of the charities who bid to run CRCs were well-established, successful, and experienced in managing large public sector contracts.

In talking with us, the charities identified two broad reasons why they thought those bids hadn’t been successful. Firstly, there was a strong feeling that charities had been undone by key, eleventh-hour changes to the bidding process, which left voluntary organisations at a particular disadvantage.

Crucial details of a "parent company guarantee" were only refined after the first bidding rounds had been completed, which required bidders to have a parent company willing to stake assets equivalent to the size of the annual CRC contract. Working with far less capital than private companies, this meant charities needed to scramble to find a third party which would provide the guarantee and carry the risk. Not surprisingly, this created substantial extra work, and many would-be charity providers simply couldn’t find anyone willing to do so. The whole thing, explained one charity involved, was "chaotic and confused".

Secondly, there was a fear that charities’ involvement was merely cosmetic. Voluntary bodies came to suspect they were "bid candy", there only to give an appearance of balance to a process stacked against them: it was politically expedient for MoJ officials to engage them, but little more. These were major players in rehabilitation work, but some admitted to worrying that they had been naïve. 

The charities have every right to be frustrated. Government officials shouldn’t play fast and loose with the charity sector. The frustrations we heard didn’t just turn on their failure to get contracts (although they were naturally unhappy about that, too). There was also a lot of annoyance about the amount of time wasted putting together bids which weren’t then taken seriously enough, and about the sacrifices made to meet conditions which shifted very late in the process. The MoJ "had behaved irresponsibility with charity resources", we were told.

This is no small deal for charities. Voluntary organisations must justify how they use their resources to their donors, and are required by law to make sure that their time is committed to achieving their charitable goals. When we met with the charities involved, they felt used. And that isn’t good enough.

In 2015, Transforming Rehabilitation won a Civil Service Award for, among other things, "building a diverse market". To be honest, this feels a bit rich. The charity sector brings diverse expertise to civil society, quite distinct from what would be found in public bodies and private companies. At its best, it can deliver lasting impact for society as a whole.

We think charities should have had the chance to head-up some of this work, with civil society organisations leading the way in a new system — but that chance has been lost.

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