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Main address: www.gov.uk/government/organisations/ministry-of-justice

Transforming Rehabilitation

Transforming Rehabilitation: Contracts for the Services of Rehabilitative Services and Offender Management

England and Wales.

Successful bidders in the competition acquired the Community Rehabilitation Companies (CRCs) and contracts were awarded on 5.12.2014 (and entered into with CRCs) for the delivery of probation services. The contracts are for a 7 year initial term with an option to extend for a further 3 years. The contracts also provide for an exit period during which services continue to be provided of between 3 and 24 months from the expiry/termination date. The GBP (£) figures quoted within the original contract notice were the maximum anticipated, total, real value of the contracts where the contracts have been extended to the fullest amount allowed under the contract and payment by results has been paid at the maximum level in all periods including all extensions.

Metropolitan and City of London

England and Wales.

Successful bidders in the competition acquired the Community Rehabilitation Companies (CRCs) and contracts were awarded on 5.12.2014 (and entered into with CRCs) for the delivery of probation services. The contracts are for a 7 year initial term with an option to extend for a further 3 years. The contracts also provide for an exit period during which services continue to be provided of between 3 and 24 months from the expiry/termination date. The GBP (£) figures quoted within the original contract notice were the maximum anticipated, total, real value of the contracts where the contracts have been extended to the fullest amount allowed under the contract and payment by results has been paid at the maximum level in all periods including all extensions.

The contract is now being modified to include: new early termination provisions for termination of the contract on specified terms in 2020, revision of the baseline date used for calculation of the frequency reoffending element of the Payment by Results (PbR) mechanism, adjusting the binary reoffending calculation to reflect the impact of a change in the data source, new specifications for through the gate and offender contact services and enhanced management information requirements under Schedule 20 of the contract.

Further information relating to VII.2.2 Reasons for modification:

The modifications being made are, in line with those proposed in voluntary ex-ante transparency notice 2018/S 146-335161, as follows:

— rebaselining frequency of reoffending payment-by-results measure from 2011 to the average of performance between 1.10.2015 and 31.3.2016 and changing the thresholds for termination if reoffending reaches a certain rate in proportion to the baseline change. This is justified in response to unforeseeable circumstances. The 2011 baseline was used as the closest proxy for reoffending levels at the start of the contract. However, those levels increased in a way which was not known or foreseeable when the contract was let in 2014. The revised baseline is the closest available proxy for the data as at the start of the contract in February 2015,

— placing an obligation on the Authority to terminate the contract by 31.12.2020.This is justifiable on the basis that it is a further response to the unforeseen circumstances (unforeseeable case volumes, case mix and fixed/variable costs ratio) which necessitated the modification and subsequent voluntary ex-ante transparency notice dated 27.5.2017, alternatively on the basis that the new termination provision is consistent with Regulation 73,

— adding an obligation on the Contractor to deliver enhanced resettlement services. The services are additional to original requirements and cannot be delivered by another Contractor given the other CRC obligations to deliver these services. The contract value is not increased by more than 50 %,

— adjusting binary reoffending payment-by-results measure to reflect the impact of a change in data source. It was not foreseeable that the change to the data source used to measure entries and releases from prison would have a statistically significant effect on reoffending rates,

— waiving 2014/15 fee-for-service reconciliation payments due from the Contractor. This is justifiable on the basis that it is a further response to unforeseen circumstances (unforeseeable case volumes, case mix and fixed/variable costs ratio) which necessitated the modification and subsequent voluntary ex-ante transparency notice dated 27.5.2017. This modification addresses the period prior to the date of that modification,

— adding obligations on the Contractor to deliver a new minimum offender contact. The services are additional to the original requirements and cannot be delivered by another Contractor given CRC obligations to deliver offender supervision. Payments to the CRC are not being increased to deliver these services, and

— requiring more detailed monthly management information on CRC finances and workforce. Payments to the CRC are not being increased in response to this change.

The contract value excluding VAT after the modification is based upon the actual performance of fee for service and payment by results up to October 2018 including the modifications as set out above in the “Reasons for Modification”.

The need for modification is brought about by: the need for additional services, circumstances which a diligent contracting could not foresee, required non-substantial changes to the contract and provision for termination) of the contract. The modifications are in accordance with Part 2 of the Public Contracts Regulations 2015 (the “Regulations”) which implements Directive 2014/24/EU. The modifications are particularly provided for in the following provisions of the Regulations: Regulation 72(1)(b) (additional services), Regulation 72(1)(c) (unforeseen circumstances), Regulation 72(1)(e) (non-substantial changes) and Regulation 73 (provision for termination).

Please refer to VII.2.1 Description of the modifications above for further information.