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READING BOROUGH COUNCIL

REPORT BY CHIEF EXECUTIVE

TO:

COUNCIL

DATE: 16 OCTOBER 2018 AGENDA ITEM:

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TITLE: TRANSFER OF READING BOROUGH COUNCIL’S CHILDREN’S SERVICES TO BRIGHTER FUTURES FOR CHILDREN LIMITED (A WHOLLY OWNED SUBSIDIARY COMPANY OF READING BOROUGH COUNCIL)

LEAD COUNCILLORS:

JO LOVELOCK, LIZ TERRY, ASHLEY PEARCE, JASON BROCK

PORTFOLIO:

LEADER OF THE COUNCIL, LEAD COUNCILLOR FOR CHILDREN, LEAD COUNCILLOR FOR EDUCATION, LEAD COUNCILLOR FOR CORPORATE AND CONSUMER SERVICES

SERVICE: CHILDREN, EDUCATION & EARLY HELP SERVICES

WARDS: BOROUGHWIDE

LEAD OFFICER: PETER SLOMAN

TEL: 0118 937 2067

JOB TITLE: CHIEF EXECUTIVE E-MAIL: peter.sloman@reading.gov.uk 1. PURPOSE OF REPORT AND EXECUTIVE SUMMARY 1.1 Further to the Minutes of Policy Committee on 15 January 2018, and of the Adult

Social Care, Children’s Services and Education (ACE) Committee on 11 July 2018, this report sets out the decisions required by the Council to transfer the delivery of the Council's children's services to a newly established, wholly owned subsidiary Company of the Council, Brighter Futures for Children Limited (‘BFfC’/the ‘Company’). This follows the recommendation of the Children’s Services Commissioner (Nick Whitfield) to establish a ‘full service’ children’s Company, which was formally endorsed at Policy Committee on 15 January 2018. As part of this endorsement, the Committee also agreed to transfer the Council’s Children’s Social Care, Early Help and Education services to the Company.

1.2 This report seeks Full Council approval to the formal transfer of the Council’s children’s services to the Company, which includes the direct award of a services contract to BFfC for the delivery of the Council’s children’s services by BFfC, for and on behalf of the Council (the ‘Service Delivery Contract’). The report also asks Council to approve the terms of other key documents which will underpin the relationships between the Council and BFfC, in particular the Company’s Articles of Association.

1.3 The report further asks Council to agree to the transfer of relevant Council staff and assets to BFfC; and to amend relevant parts of the Council’s Constitution and register of delegations to reflect the establishment of BFfC as an independent, wholly owned subsidiary Company of the Council.

1.4 The documents listed below are appended to the report. They will be published on the Council’s website. Full sets of the appendices will be printed and put on deposit in each Group room.

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Appendix A: Memorandum of Understanding (28 March 2018) Appendix B: DRAFT (i) Articles of Association and (ii) Governance Side Agreement (iii) Service Delivery Contract (These documents have been provided in confidence to all Councillors because they are draft documents and when completed will be published) Appendix C: Revised Portfolios for Lead Councillors for Children and Education Appendix D: Revised terms of reference for the Adult Social Care, Children’s

Services & Education, and Policy Committees Appendix E: Property Matters

i. Floorplan - Civic ii. Whitley Health Building iii. Other Buildings

Appendix F: Support Services – Service Level Agreements Summary 2. RECOMMENDATIONS 2.1 That the Articles of Association for the Company (which include the Council’s

reserved matters in relation to the Company) and the Governance Side Agreement, at Appendix B (i) and (ii) which had been provided to Councillors confidentially, be noted and the Chief Executive, in consultation with the Leader of the Council and Lead Councillors for Education, Children and Corporate & Consumer Services, be authorised to finalise the terms of the above documents;

2.2 That the intention to directly award the Service Delivery Contract, at Appendix B

(iii) which had been provided to Councillors confidentially, to BFfC for the provision of the Council’s children’s social care, education and early help functions set out in Section 8 of the report, in accordance with the Memorandum of Understanding between the Council and the Department for Education and in line with the agreed resolution of Policy Committee on 15 January 2018 (Minute 59 refers), be noted and the Chief Executive, in consultation with the Leader of the Council and Lead Councillors for Education, Children and Corporate & Consumer Services , be authorised to finalise the terms of the above document;

2.3 That the contracting-out of the performance and discharge of the Council’s

children’s social care functions and the relevant education and early years functions, listed in Section 9, pursuant to the said Service Delivery Contract and in accordance with [Section 1 of the Children and Young Persons Act 2008 and the Contracting Out (Local Authority Education Functions) (England) Order 2002], be authorised and approved;

2.4 That the transfer of and/or provision via Service Level Agreements of support

services by the Council to BFfC, via the Support Services Agreement in the Service Delivery Contract as set out in Section 12, be approved;

2.5 That the transfer of property (by way of lease), assets and third party contracts

from the Council to BFfC be approved, as set out in Section 13 of the report, and the necessary licences, leases and contracts be entered into;

2.6 That the transfer of all relevant staff via TUPE (Transfer of Undertakings

(Protection of Employment) arrangements on the Service Delivery Contract commencement date, as set out in Section 15 of the report, be approved;

2.7 That the Council’s proposal for designated body status in relation to the pension

arrangements of all transferred staff, as set out in Section 15 of the report, be approved;

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2.8 That with regard to the Council’s constitution: a) the revised portfolios for the Lead Councillors for Children, and Education,

attached at Appendix C, be agreed; b) the revised terms of reference for the Adult Social Care, Children’s

Services & Education Committee, to reflect the transfer of the direct provision of children’s social care, education services and early help functions to Brighter Futures for Children, and the new role of oversight of the RBC clienting function of the contract with Brighter Futures for Children, attached at Appendix D, be agreed;

c) the function of exercising the Council’s sole membership/ownership of

Brighter Futures for Children be added to the terms of reference of the Policy Committee;

d) the Monitoring Officer be authorised to make any other necessary

amendments to the Council’s Constitution and Scheme of Officer Delegation to reflect the establishment and responsibilities of BFfC, in conjunction with the Director of Children, Education and Early Help Services, and to report these for retrospective approval to the Annual Council Meeting in May 2019.

2.9 That the Chief Executive, in consultation with the Leader of the Council and Lead

Councillors for Education, Children and Corporate & Consumer Services, be authorised to finalise the terms of the new arrangements with BFfC and the Department for Education prior to formal transfer of the children’s services to the Company pursuant to the Service Delivery Contract; and be delegated authority to make a Council appointment to the board of directors of the Company.

2.10 That the Head of Legal & Democratic Services be authorised to execute all legal

documents that would be necessary to give effect to the above resolutions. 3. POLICY CONTEXT AND BACKGROUND 3.1 In August 2016 Ofsted published their findings following an inspection of Children’s

Services in Reading. Children’s Services were rated ‘Inadequate’. As a result, and in line with the Government’s reform programme ‘Putting Children First’ the Department for Education (DfE) issued a statutory direction notice (September 2016) to the Local Authority and appointed a Commissioner, Nick Whitfield. The direction notice required Reading Borough Council to comply with any direction of the Commissioner in improving services for children.

3.2 The recommendation of the Commissioner, in September 2017, was to take the

Council’s children’s services out of the direct control of the Council for the period of their intervention. The Secretary of State issued a second statutory direction notice in September 2017 for the Council to establish a ‘full service’ children’s Company to deliver a long-term improvement plan to address the findings of the Commissioner’s report.

3.3 The Policy Committee, on 15 January 2018, agreed to transfer the Council’s

Children’s social care, early help and education services to the Company by the autumn of 2018. The Committee’s resolution, at Minute 59, was as follows:

(1) That the latest position in the development of an independent local authority Company for the provision of Children’s Services be noted;

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(2) That Reading’s children’s Company include education and early help along with child protection functions;

(3) That the programme support contract be awarded to Mutual Ventures Ltd;

(4) That the Chief Executive and Director of Children, Education & Early Help Services be authorised to accept funding from the Department for Education on behalf of the Council to enable the set-up of the new Children’s Company;

(5) That the Chief Executive be authorised to undertake all necessary steps required to establish the Company by autumn 2018;

(6) That a report be submitted to a future meeting to transfer and agree a service contract with the Company.

3.4 Since this date, work has continued to deliver improvement to children’s services.

OFSTED Monitoring visits have taken place over this period. OFSTED letters show that there are very pleasing signs of improvement and that the service must not take its eye off the improvement plan, continued improved performance, and its savings targets during transition to the new Company.

3.5 The most recent update report to Members on the development of the children’s

Company was the ACE Committee on 11 July 2018. The committee reviewed the following milestones towards the establishment of the Company:

• Memorandum of Understanding - agreeing the key principles for the operation of

the Company, legal form, proposed composition of the board of directors, and the operational framework within which the Company will operate and be held to account

• Appointment of Chair of the Company (Deborah Jenkins) • Staff transfer under TUPE • Company name and branding materials • Service specification and contract • Service level agreements for the provision of support services functions • Client side structure including governance arrangements and the performance

mechanisms to allow the Council to hold the Company to account for the services it will deliver on the Council’s behalf;

3.6 The Council will have 100% ownership of the Company which will be run by a senior

management team reporting to the Company board of directors, the Board will report to the Council (Policy Committee) as its sole member/owner.

3.7 In order to provide the appropriate assurances to the Council it was anticipated that

there would be the following:

• Annual report on performance and the Company’s business plan to the Council; • Reports on performance during the year (as set out in the Governance Schedule)

to the sole member/owner; • Monthly performance (and financial monitoring) through the contract management

function, underpinned by contractual reporting requirements including open book provision of data.

3.8 The Company will operate from the Civic Offices and have a specific and separate

secure space with appropriate branding to identify the Company. 3.9 The 11 July 2018 ACE committee report had appended the Memorandum of

Understanding made on 28 March 2018 between the Secretary of State, acting through

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the Commissioner, and Reading Borough Council, to establish the children’s Company. This in turn had attached the following documents:

• The Statutory Direction issued on 12 September 2017 • Terms of Reference of the Non-Executive Commissioner for Children’s Services • List of Transferring Services, and relevant support services

3.10 The 11 July 2018 ACE Committee resolved, at Minute 5, to note the latest position in

the development of the Company, and an OFSTED letter of 8 June 2018 showing a positive direction of travel, and to arrange an all-Councillor briefing session.

3.11 OFSTED conducted a further monitoring visit over July 2018, the findings of which

were published in a letter on 23 August 2018. 3.12 An all-Councillor briefing session on the development of the Company was held on 24

July 2018 and the Lead Councillor for Children’s has been regularly briefed on the development of the Company. Staff briefing sessions have continued to be held, led by the Chair of the Company, the most recent being on 13 September 2018.

4. FINAL STAGES OF ESTABLISHING BRIGHTER FUTURES FOR CHILDREN 4.1 The Council is now in the final stages of transition activity to establish its children’s

services Company. This work is being driven via robust programme management of a set of 11 work streams each led by a senior officer in the Council which, together, will deliver all the tasks required.

4.2 The chair of the Company, Deborah Jenkins, comes with a wealth of experience and is

now very actively involved in the transfer of the services. Four Non-Executive Directors have been appointed to the Company Board and the Managing Director and Finance Director roles have now been appointed to. Work is being done following the appointment of a new Director of Children’s Services, Stephen Kitchman, who started at the Council on 4 July 2018, to recruit the remainder of the Company’s senior management team.

4.3 The majority of the Council’s children’s services staff, and a small number of

identified support services staff, will be TUPE’d to the Company and they are being briefed regularly including face-to-face briefings.

4.4 The detailed work on the service specification and contract is now being finalised. The Service Delivery Contract addresses the requirements of the specification and Council responsibilities, and financial matters including the financial mechanism and annual review, performance and key performance indicators.

4.5 A budget working group has finalised preparation of the Company budget for the remainder of the current financial year. This is consistent with the budget already approved for children’s services plus the transfer of appropriate support services costs and the additional costs of setting up the Company which are grant funded. The Company is currently reviewing this budget. The Company’s Business Plan and proposed budget for 2019/20 will be submitted to Policy Committee early in December following the agreed financial mechanism pursuant to the Service Delivery Contract in order to inform the Council’s Budget setting process.

4.6 The Service Level Agreements between the Company and the Council for the provision by the Council of support functions are also being developed in parallel with the Service Delivery Contract. The Memorandum of Understanding specifies that the Company will ‘buy back’ the majority of support functions from the Council for a minimum of two years. A Support Services Agreement will be the contract for all the

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Service Levels Agreements between the Company and the Council. A summary of the provisions of the support services Service Level Agreements is set out in Appendix F.

4.7 Work is progressing well, to an ambitious timescale which is under continuous review.

There are some critical factors which could impact on the services commencement date for the Company such as the OFSTED registration. The Non-Executive Directors (including the Chair) of the Company have begun their independent review of the proposed contractual documents and the new arrangements, which could also impact on the timing of services commencement by the Company If a delay in establishment is considered to be likely, it is anticipated that the Company will, nevertheless, operate in shadow or a ‘test and learn’ environment. Any such decision would be in collaboration between the Council, DfE and Chair of the Company.

5. GOVERNANCE ARRANGEMENTS BETWEEN THE COUNCIL AND BRIGHTER FUTURES

FOR CHILDREN 5.1 The Company is a company limited by guarantee. This legal form meets all of the key

objectives for the Council in ensuring that the Company focuses solely on the promotion and delivery of improved outcomes for the Reading’s children, young people and their families. The Company will be a ‘not for profit’ Company.

5.2 The Memorandum of Understanding was reported to the ACE Committee on 11 July

2018, and is attached to this report at Appendix A. Appendix B to the MoU lists the services transferring to the Company, and relevant support services which will transfer or be purchased by the Company from the Council.

5.3 The formal relationship between the Council (as its sole member/owner) and the

Company is set out in the Articles of Association, attached at Appendix B (i). The Articles of Association contain the Council’s reserved matters in relation to the Company.

5.4 As the Company is a company limited by guarantee it does not have shares – owners of

the Company are therefore members, not shareholders. The Council is the Company’s sole member. As the sole member, the Council will have certain decisions expressly reserved to it under the Articles of Association (see section 6 below). The Council will therefore retain overall strategic control of the Company. However, during the period of the intervention, in respect of some of these decisions, the Council will need to seek the prior consent of/consult with the DfE, as agreed under the Governance Side Agreement, included in Appendix B (ii) (see paragraph 6.1 below), which will be entered into between the Council and the DfE on or before “go-live”.

5.5 Although, through the matters reserved to it as sole member, the Council will have

overall strategic control of the Company, the Board of Directors of the Company will have the day-to-day operational independence over the management of the Company’s business and the performance of the relevant children’s services functions and services under the Service Delivery Contract.

5.6 As part of the arrangements to establish and run the Company, the Council’s Director

of Children’s Services (DCS) will be seconded to Brighter Futures for Children. The DCS will continue to be appointed and employed by the Council and will be seconded to the Company 4 days a week (0.8FTE) and perform RBC statutory functions 1 day a week (0.2FTE). The DCS will be a member of the Company Board as an Executive Director.

5.7 As per the Memorandum of Understanding, the Board of Directors will be fully

empowered to manage the Company’s day-to-day business and affairs in accordance with the Company’s approved Business Plan.

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6. DEPARTMENT FOR EDUCATION RIGHTS AND CONSULTATION 6.1 During the intervention period, there will be a Governance Side Agreement (“GSA”) in

place. The GSA is a contractual agreement between the Council and the Secretary of State for Education. The Secretary of State is not a party to the Company’s corporate governance arrangements and, as such, the GSA sets out certain rights afforded to the Secretary of State in respect of certain matters reserved to the Council under the Articles of Association, corporate governance, and the Secretary of State’s third party rights under the Service Delivery Contract. The GSA sets out when and how the Council consults with and obtains the consent of the Secretary of State. The full draft version of the GSA, including the terms and process for consultation with the Secretary of State, can be found in Appendix B (ii).

6.2 During the period of the intervention under the Direction, the Secretary of State shall

be consulted on the following matters:

any proposed changes or amendments to the Articles of Association; the approval/amendment of the Company’s Business Plan; the prior approval of any new third party contracts above a pre-agreed value

threshold (£500k); any proposal for the Company to enter into any other services contract with the

Council for the provision of other Council services following the service commencement date;

any proposed change in name or trading name of the Company, or the registered office of the Company;

a proposal by the Company to form or procure the formation of any other legal entity or undertaking which the Company would be a member, shareholder or any similar legal position (analogous position in jurisdiction).

6.3 During the period of intervention, the Secretary of State shall have the following

rights of approval by prior written consent:

appointment or removal of the Chair; appointment of removal of the Managing Director; any change to the membership of the Company; voluntary winding-up of the Company (save where the Company is insolvent and

action is necessary by the Directors to comply with their statutory duties). 6.4 During the period of intervention, the Secretary of State shall have the right at any

time on giving written notice to the Council to request that it exercises its rights under the Articles of Association to:

remove the existing Chair; change the terms of appointment of the Chair; appoint a new Chair, as nominated by the Secretary of State in writing.

6.5 During the period of the intervention, the Secretary of State shall have the following

third party rights under the Services Delivery Contract.

Without the prior written consent of the Secretary of State:

the Children’s Social Care Services shall not be capable of termination; the Services Delivery Contract shall not be extended nor shall any break rights be

exercised; notifiable changes (as defined in the Services Delivery Contract) shall not be

made;

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the company shall not assign, novate or otherwise dispose of any of its rights under the Services Delivery Contract;

the Council shall not exercise its rights of step-in. 7. BUSINESS PLAN - BRIGHTER FUTURES FOR CHILDREN 7.1 Brighter Futures for Children is developing a Business Plan to set out its strategic

objectives and guide its operation. The Company Business Plan has been developed by the Company Board in discussion with senior Council officers and will be approved at a future Policy Committee.

7.2 The business plan sets out the pledge and ambition of the Company: Our pledge is to provide excellent services for our most vulnerable children.

Our ambition is to unlock all the resources of the borough to help all children have a good life. The business plan sets out the following values for the Company: Honest – transparent and open about how we work;

Creative – not be bound by convention;

Caring – every decision in the best interest of the child;

High quality – efficiency, effectiveness and professionalism;

Respectful - We will value diversity;

Responsible – a prudent organisation and a good partner, using limited resources

wisely.

7.3 The Business Plan sets out how the Company will deliver the performance measures and Key Performance Indicators (KPIs) specified in the service contract.

7.4 The Board will develop and finalise the BFfC Business Plan 2019/20 to report to the

Member in early December 2018. 8. SCOPE OF SERVICES AND RESPONSIBILITIES Services 8.1 The Memorandum of Understanding between RBC and the DfE (Appendix A) sets out

the scope of services to be transferred from the Council to the Company. Once the Service Delivery Contract is in place, the Services Specification within the Service Delivery Contract, will supersede the MoU as the list of transferring services. The services that are transferring to the company are as follows:

Single Point of Assessment (including Child Sexual Exploitation Hub and Multi

Agency Safeguarding Hub) Access & Assessment Children in Need (including Edge of Care) Looked After Children (including Leaving Care and Contact) Fostering Services

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Residual adoption services (non-Regional Adoption Agency functions) Residential Units Independent Reviewing Officers & Child Protection Chairs Youth Service Youth Offending Service Early Help Early Years Children’s Centres, Under 5s & Nurseries Special Education Needs & Disabilities Children & Young People with Disabilities Education Services & School Support Services (including School Admissions & Pupil

Place planning) Virtual School Educational Welfare Educational & Child Psychologists Management of Dedicated Schools Grant (DSG) Support for Local Safeguarding Children’s Board (LSCB) – including support for the

Independent Chair of the LSCB 8.2 The following children’s services will remain with the Council:

• Appointment of Reading Director of Children’s Services (DCS); • Appointment of the Chair of the LSCB; • Reading Children’s Services Improvement Board; • Mosaic case management system (RBC will continue to host and run Mosaic); • Home-to-School transport; • Commissioning of Children’s Public Health 0-19 Services (health visiting and school

nursing); • Maintenance and development of new school buildings and building development

work; • No Recourse to Public Funds (NRPF Team); • Responsibility for the academisation programme – including conducting any

competitions for new Free Schools; • Contract with Adopt Thames Valley (adoption service); • Commissioning and contract management of the children’s Company (client role).

8.3 The following services will be provided by the Director of Children’s Services in their

RBC capacity of 0.2FTE:

• Report to and advise the Council, Leader and Lead Councillor for Children, and Chief Executive and Corporate Management Team;

• Attend / report to other RBC committees as required; • Work with Local Safeguarding Children’s Board; • Advise the Corporate Parenting Panel; • Administration of DSG budget; • Liaison with other local and regional Directors of Children’s Services.

Constitutional Changes

8.4 The transfer of services to the Company will require changes to the portfolios of the

Lead Councillors for Children, and Education; and the delegations made to the Director of Children, Education and Early Help Services and the Heads of Service in his Directorate. The revised Lead Councillor portfolios are at Appendix C.

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8.5 The establishment of the Company to deliver the Council’s Children’s social care, education and early years services will require amendments to the terms of reference of the ACE Committee, and also the Policy Committee. The Council will have two discrete roles in relation to the children’s Company:

• Service delivery – clienting the Service Delivery Contract and monitoring BFfC’s

performance in delivering the functions transferred to the Company • Company’s sole member/owner

8.6 A similar arrangement applies to ‘Homes for Reading’, another wholly-owned

Company of the Council. Here, the two roles are separate, with the clienting and service delivery role being exercised by the Housing, Neighbourhoods and Leisure Committee, with the Policy Committee exercising the sole member/owner role.

8.7 This report recommends a similar separation, with the Policy Committee exercising

the member/owner role for Brighter Futures for Children, and the RBC clienting (contract management function) role being overseen by the ACE Committee. Via this arrangement the RBC contract management function will report to the ACE committee on the performance of the children’s Company. The revised terms of reference for the ACE Committee are attached at Appendix D. The function of exercising the Council’s role as sole member/owner of the Company will be added to the Policy Committee.

8.8 This report also recommends that the Head of Legal & Democratic Services be

authorised to work with the Director of Children, Education and Early Help Services to review and update the delegations to the Director and his Heads of Service, and to submit the revisions for retrospective endorsement to the Annual Council Meeting in May 2019.

9. PERFORMANCE FRAMEWORK & PERFORMANCE MANAGEMENT 9.1 The Service Delivery Contract will be entered into between the Company and the

Council as a seven-year contract with the provision to break five years from the full commencement of the delivery of the services. The break right is exercisable by the Council (note, if during the intervention period, the Council would need to obtain the prior written consent of the Secretary of State before exercising this right).

9.2 Under the Service Delivery Contract, the Company will act as the provider and deliver

specified children’s services functions on behalf of the Council, however the Council will remain statutorily responsible and accountable for the discharge of the relevant children’s services functions.

9.3 The Service Delivery Contract consists of core legal terms under which the Company

will provide the services in return for payment of the contract sum, such sum to be agreed in accordance with the Financial Mechanism (Schedule 5 to the Service Delivery Contract).

9.4 The Service Delivery Contract includes key operational provisions such as the Services

Specification and Performance Management Framework setting out how the Company’s performance will be measured, together with an outline of the contractual governance arrangements and the interface with the dependencies for which the Council retains responsibility.

9.5 The following are the principal elements of the Service Delivery Contract but the

Council should recognise that significant further detail regarding the agreed contractual terms between the Council and the Company are set out in the Service Delivery Contract and the associated contractual arrangements.

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9.6 The Performance Schedule within the Service Delivery Contract sets out the

arrangements through which the Council will monitor the performance of the Company and hold it to account.

9.7 The Performance Mechanism will enable the Council to monitor the performance of

the Company against performance indicators throughout the life of the Service Delivery Contract. In order to ensure improvement journey continuity, it has been agreed by senior Council and Company stakeholders that the Company will adopt KPIs from the Council’s Children’s Services Improvement Board up to the end of March 2019 together with KPIs in respect of staff turnover and recruitment (with some additional indicators to cover Education and Early Help). These are currently under review by the Company and Council. As part of the annual Business Planning process a set of KPIs for the Company will be developed to apply from April 2019. The KPIs will drive the Company’s performance and will be aligned to transforming the service to an Ofsted rating of ‘Good’.

9.8 Brighter Futures for Children will provide performance metrics information required

by the Council on a cycle set out in the Performance Schedule. BFfC will provide exception reports as required where any areas of performance which are not on target and will give details of any mitigation plans that have been put in place to improve performance. If Company performance against any of the performance indicators does not meet the required target/tolerance, or where there has been a sustained lack of improvement in any of the key areas, this will be escalated to the Issues Resolution Group, which includes the Council Chief Executive and Company Managing Director (or Board Nominee).

9.9 Within prescribed instances of failure to achieve performance measures the Company

will be requested to produce action plans. Through the governance arrangements these can be escalated to a formal rectification plan to address underlying issues if poor performance continues.

9.10 The Service Delivery Contract includes a [five-month] grace period in year zero.

During this period the Council will receive monitoring reports of the Company’s performance against the initial set of performance indicators but there will be no “Performance Failures” which trigger the escalation process.

10. RBC CONTRACT MANAGEMENT (CLIENT FUNCTION) 10.1 Proposals for the client side structure, including governance arrangements and the

performance mechanism, have been developed so that the Council can hold the Company to account for the services it delivers. The Council’s Head of Procurement and Contracts will be responsible for overall management of the Service Delivery Contract with the Company.

10.2 In order to provide the appropriate assurances to the Council:

The RBC Children’s Services Improvement Board will continue to receive monthly reports on child protection services performance until March 2019. From April 2019, the reports and Board meetings will move to once every 2 months;

The Council contract manager will receive reports on the Company’s performance regarding non-child protection services (including against the agreed KPI targets) once every 2 months;

The Council contract manager will receive monthly reports on Company’s financial performance and its spend against forecasts/profiles;

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A Contract Management Group meeting held between the Council and Company once every 2 months, which will consider the performance reports, financial reports and relevant matters as raised by the Children’s Services Improvement Board;

Any issues will be escalated to an Issues Resolution Group (comprising the Contract Management Group, RBC Chief Executive, and Company Managing Director (or Board nominee);

Open Book financial data; Within the terms of the agreed Governance Schedule of the Service Delivery

Contract, reports on performance to the Adult Social Care, Children’s Services and Education (ACE) Committee, and an annual report to the sole member/owner (Members of the Policy Committee);

The Company’s annual Business Plan to the Policy Committee as sole member/owner as required;

Significant changes to the Business Plan will be submitted to the Policy Committee as sole member/owner as required.

11. CONTRACT PAYMENT AND FINANCIAL MECHANISM 11.1 The financial mechanism specifies the detail of the financial arrangements between

the Company and the Council, including details of invoicing and payment arrangements, contract sum negotiation, in year changes and the management of surplus/deficits.

11.2 The contract sum for Year Zero (November 2018 to March 2019 inclusive) is based

upon the remainder of the current 2018/19 budget plus the transfer of appropriate support services costs and the additional costs of setting up the Company which are grant funded. The contract sum will be reviewed and agreed annually by the Policy Committee acting as member/owner and will be included in the Council’s overall budget.

11.3 The Company will be paid for services in arrears with a loan facility to cover cash

flow. 11.4 Any sums due to the Council for services that the Council provides to BFfC (e.g. for

support services) will be paid by BFfC to the Council on a monthly basis at the end of each month, under the same terms as the payments from the Council.

11.5 BFfC is permitted to submit in-year change requests during a contract year where

there might be an unforseen increase in demand for services (or cost of those particular services) and which places a significant additional financial burden on the Company. In this case BFfC firstly has a duty to mitigate any additional cost, including investigating the availability of any external funding, and must evidence the increase in demand / cost of services and that these will have a significant additional financial burden on BFfC that cannot be mitigated by reductions in expenditure and / or increases in income in other areas of BFfC or through the use of any available reserves. Subject to the foregoing, and the provision of the necessary supporting information, the Council would then fund the unmet cost of such additional unforeseen increases in demand during a contract year.

11.6 The financial mechanism includes provision for BFfC to request investment from the

Council. This would require BFfC to submit a business case for funding to the Council. The approval of any such additional funding is at the Council’s absolute discretion.

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11.7 There are instances where the Council will receive grant funding / partner contributions in respect of services to be delivered by BFfC. This funding will be paid to the Company by the Council following receipt. BFfC are required to comply with any funding conditions that apply. If these conditions are not met by BFfC, and in the event of any subsequent clawback of funding, this will be paid by the Company.

11.8 The Company is required to prepare monthly financial reports for the Council and

upon request make available to the Council financial data for the purposes of examination

12. SUPPORT SERVICES 12.1 Work has been undertaken within the Council to identify and assess which support

services should be transferred to the Company and which should be retained by the Council and provided to the Company via a Service Level Agreement (SLA).

12.2 Following discussion between the Corporate Management Team and the Company

Chair, it is proposed the following support services functions will be transferred into the Company:

Finance and Management Accounting Business Planning (Finance) Customer Relations Strategic Human Resources Marketing & Communications

12.3 Following discussion between Council senior officers and the Company Chair, it is

proposed the following support services functions are provided by the Council to BFfC via Service Level Agreements (SLAs):

Audit & Investigations Legal & Democratic Services (including Information Governance, Data Protection,

Legal, Committee admin, and Ombudsman) Joint Legal Team Human Resources administration Procurement Insurance Customer Services Regulatory Services Transport Finance systems – Transactional and specialist advice Emergency Planning, Risk & Business Continuity Business change Records management Health & Safety ICT

12.4 A detailed summary of the provision, recharge value and final value of each SLA is set

out in Appendix F. 13. PROPERTY, ASSETS AND THIRD PARTY CONTRACTS Property

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13.1 The floorplan illustrating the space available for the new Company HQ is detailed in Appendix E(i).

13.2 A revised layout for the Whitley Health Building retains the cellular offices for the

Company. This has enabled additional meeting rooms to be retained at Whitley Health Building; enabling the five meeting rooms at this site to be flexibly booked by BFfC (see Appendix E(ii)).

13.3 Children’s Services will also occupy spaces within other Reading Borough Council

buildings. Lease agreements for these spaces are being put in place. Appendix E(iii) gives the full list of occupancy.

Assets 13.4 Work to cover the treatment of assets has agreed the following;

A full list of ICT assets will be detailed within the Service Delivery Contract Vehicle assets will be detailed within the Service Delivery Contract Furniture, Fixtures and Equipment (FF&E) assets are covered by the principle that

they will transfer to the Company, this will include all the FF&E currently within the properties/workplaces occupied by the Company. The current budget assigned to Children Services for the maintenance, repair and replacement of such assets will transfer to the Company

13.5 The above asset types will be transferred to the Company but would transfer back to

the Council or such other party as the Council may request on expiry or termination of the Service Delivery Contract.

Third-party Contracts 13.6 Work has taken place to identify and treat third party contracts relevant to the

Company (over a spend value of £10,000). Following review the contracts were divided into the following categories with separate contract registers developed for each category:

a) Corporate contracts - ie contracts that the Council uses across directorates –

the Council will need to use these contracts going forwards as well as the Company;

b) Children’s Services contracts - ie contracts that are used solely by children’s Services – the Council will no longer need to use these contracts going forwards;

c) Placement contracts – e.g. fostering placements – the Council will no longer need to use these contracts going forwards.

13.7 Treatment options for the contracts are to allow access (Council retains legal

responsibility for the contract but enables the Company to benefit from the arrangement), novate (the contract is legally transferred from the Council to the Company), or terminate (the contract ceases to be operational for the Council, the Company would need to re-procure the contract independently).

13.8 The recommended treatment options are subject to the terms of the contract e.g. if

the Council wishes to novate the contract, there may be some restrictions in the contract or the Council may need to achieve novation using a different method. Or if the Council wishes to allow access, the contract may prevent the Council from doing this. The restrictions in the contract do not make the preferred treatment option

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impossible; it may be possible through agreeing new arrangements with the relevant third party supplier.

General 13.9 This report recommends that the Head of Legal & Democratic Services be authorised

to execute all legal documents on behalf of the Council that would be necessary to give effect to the above (and other) changes.

14. RISKS 14.1 Risks have been regularly reviewed through the establishment period for the Company

and have been captured and reported via a Risk Register. Where required mitigation actions have been taken. At present, the key risks to the final establishment and early period of operation for the Company are:

Registration of services with Ofsted – full registration is required for services to

be provided legally. Delays to registration will delay full Company ‘go live’; Financial viability of the Company and the Council; Company Board and Secretary of State approval.

15. STAFFING IMPLICATIONS 15.1 On service commencement under the Service Delivery Contract, the relevant Council

employees who are assigned to the in-scope children’s functions and services and/or the transferring corporate support services will transfer to the Company under TUPE.

15.2 The Council will secure designated body status for the pension arrangements of all

staff TUPE transferred into the Company. This will be put in place via a tripartite agreement between the Council, the Company, and the Pension Fund to ensure the continued provision of the Local Government Pension Scheme (LGPS) for current and future BFfC employees.

15.3 Throughout the process leading up to the establishment of BFfC, staff have been

engaged and informed of progress, key changes and implications for their roles. Information has been shared and consultation has taken place on the proposals with the trade unions and the affected employees. Formal staff consultation on their transfer to the new Company started on 13 August 2018. Trade Unions have been engaged throughout the process. A number of staff briefing sessions (led by the RBC Chief Executive and Company chair), e-bulletins, drop-in sessions and TUPE clinics have taken place.

16. EQUALITY IMPACT ASSESSMENT 16.1 Under the Equality Act 2010, Section 149, a public authority must, in the exercise of

its functions, have due regard to the need to— • eliminate discrimination, harassment, victimisation and any other conduct that is

prohibited by or under this Act; • advance equality of opportunity between persons who share a relevant protected

characteristic and persons who do not share it; • foster good relations between persons who share a relevant protected

characteristic and persons who do not share it. 16.2 In this regard it must be considered whether the decision will or could have a

differential impact on: racial groups; gender; people with disabilities; people of a

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particular sexual orientation; people due to their age; people due to their religious belief.

16.3 The Secretary of State, when issuing the Direction to the Council to establish a

children’s Company, did not consider it necessary to have an equality impact assessment to inform this decision.

16.4 As a wholly-owned Company of the Council, the public sector equality duty contained

in the Equalities Act 2010 will apply to BFfC in respect of its delivery of the authority’s services of the authority which are being transferred to it.

17. LEGAL IMPLICATIONS 17.1 The Secretary of State for Education’s decision to transfer Children’s social care

functions to a new Company has been taken under Section 497A(4B) Education Act 1996.

17.2 A decision to transfer education and early help services (not defined in the Direction

but recommended by the DfE Commissioner and accepted by RBC at the 15 January 2018 Policy Committee), to the new Company will involve a significant change to the Council’s policy framework and as such will need to be taken formally by full Council.

17.3 The creation of a new Children’s Company will require amendments to the Council’s

Constitution, including changing the terms of reference of Committees, and will therefore need to be agreed by full Council in accordance with Article 4.2.2(a) of the Constitution.

17.4 Staff will be transferred to the Company with the protection of the Transfer of

Undertaking Provisions to ensure their terms and conditions are protected on transfer. 18. FINANCIAL IMPLICATIONS (BUDGET) 18.1 The table below provides a breakdown of the Children’s Services 2018/19 budget in to

the following contract sum elements:

• In Scope – budget contained within Children’s Services cost centres; • Support Services to transfer – budget contained within Corporate Services that has

been agreed to transfer to the Children’s Company • Additional Costs – budget to represent new posts e.g. Chair, Managing Director and

NEDs, and budget required for new additional recurring costs as a result of establishing the Children’s Company e.g. external auditors and website hosting

• Support Services SLA – budget contained within Corporate Services and wider Council that represents the cost of RBC delivering support services to the Children’s Company

• Property – budget that represents the costs of property including a rental figure, service charge and utilities

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2018/19 Budget Contract Sum Element

Expenditure Income Net Budget

In Scope £70,565,400 -£30,110,800 £40,454,600 Support Services

to Transfer £497,412 £0 £497,412

Additional Costs £566,692 £0 £566,692 Support Services

SLA £3,992,807 £0 £3,992,807

Property £1,399,000 £0 £1,399,000 TOTAL £77,021,311 -£30,110,800 £46,910,511

18.2 RBC has committed £2.1m of transformation funding to enable Children’s Services to

deliver their cost reductions from 2019/20 onwards. DfE has provided a grant of £2.9m to the Council in respect of the set up costs of the Company.

18.3 The Net Budget trend, including savings agreed within the Delivery Plan and budget

pressures already allocated, for in scope services is detailed below, excluding recharges:

Net Budget (£)

2017/18 2018/19 2019/20 2020/21 In Scope 38,783,300 40,454,600 40,658,400 40,112,200

18.4 The net impact over the next 3 years of the cost reduction plans and budget pressures

is a relatively flat net budget for the Children’s Company of circa £40.4m (relating to the in scope elements of the contract sum i.e. budget for children’s service).

18.5 BFfC is permitted to submit in-year change requests during a contract year where

there might be an unforseen increase in demand for services (or cost of those particular services) and which places a significant additional financial burden on the Company. In this case BFfC firstly has a duty to mitigate any additional cost, including investigating the availability of any external funding, and must evidence the increase in demand / cost of services and that these will have a significant additional financial burden on BFfC that cannot be mitigated by reductions in expenditure and / or increases in income in other areas of BFfC or through the use of any available reserves. Subject to the foregoing, and the provision of the necessary supporting information, the Council would then fund the unmet cost of such additional unforeseen increases in demand during a contract year.

18.6 The financial mechanism includes provision for BFfC to request investment from the

Council. This would require BFfC to submit a business case for funding to the Council’s Policy Committee acting as owner. The approval of any such additional funding is at the Council’s absolute discretion.

18.7 When the go-live date is agreed any additional transitional costs will be transferred to

the Company.

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19. BACKGROUND PAPERS (LIST)

Putting Children First https://www.gov.uk/government/publications/putting-children-first-our-vision-for-childrens-social-care Direction Issued to Reading Borough Council September 2016 https://www.gov.uk/government/publications/direction-issued-to-reading-borough-council Direction Issued to Reading Borough Council September 2017 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/643864/Reading_Direction_Sept-2017.pdf Independent Report to the Secretary of State September 2016 https://www.gov.uk/government/publications/reading-childrens-services-report-to-the-secretary-of-state

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2018 THIS MEMORANDUM OF UNDERSTANDING (“MoU”) is made on

BETWEEN:

(1) The Secretary of State for Education of Sanctuary Buildings, Great Smith Street,

London SW1P 3BT (the “Secretary of State”) acting through Nick Whitfield c/o

Achieving for Children Community Interest Company, 42 York Street, Twickenham,

TW1, 3BW in his capacity as the Commissioner for Children’s Services in Reading;

and

(2) Reading Borough Council, Civic Offices, Bridge Street, Reading RG1 2LU (the

“Council”),

each a “Party” and together “the Parties”

1. Background and Purpose

1.1 On 12 September 2017, the Secretary of State issued a statutory direction to the

Council under Section 497A(4B) of the Education Act 1996 (the “Act”) (a copy of

which is set out in Appendix A to this document) (the “First Direction”). The

primary purpose of the First Direction is to secure improvements in the performance

of the Council’s children’s social care functions. Pursuant to the First Direction the

Secretary of State appointed the Commissioner for Children’s Services in Reading

(the “Commissioner”) for the purposes specified in the “Terms of Reference” set

out in the Annex to the First Direction.

1.2 As part of the Council's initiative to secure improvements in the performance of its

children's social care functions, and in consultation with the Commissioner and the

Secretary of State, the Council has elected to voluntarily establish a wholly-owned

subsidiary company (the “Company”) to perform specified children's social care

and education support functions (the “Relevant Functions”) on behalf of the

Council in the Borough of Reading and to directly award a contract to the Company

for these purposes pursuant to Regulation 12 of The Public Contracts Regulations

2015 (the “In-House Exemption”). These transition arrangements shall be referred

to as the “Project” in this MoU and the Parties agree that this Project will support

and promote sustainable improvement to children’s social care services in Reading.

1.3 The intention of the Secretary of State is to issue a further statutory direction under

Section 497A(4B) of the Act (the "Second Direction") on or around the execution

of the Services Contract (as defined in paragraph 1.4 below). In view of the agreed

position set out in this Memorandum of Understanding (the "MoU"), the intention of

the Second Direction is to acknowledge that the Council has voluntarily elected to

delegate the performance of specified children’s social care functions to the

Company. For the purposes of this MoU, the First Direction and Second Direction

are referred to collectively herein as "the Directions".

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1.4 Notwithstanding that the Company will be a wholly-owned subsidiary company of

the Council, the Council agrees that the new organisation will have operational

independence from the Council in respect of the day-to-day management and

performance of the Relevant Functions, which will be managed and regulated by

the Council pursuant to an arm's length contract to be entered into between the

Council and the Company (the “Services Contract") as more particularly described

in paragraph 7 below. The Council shall remain statutorily responsible and

accountable for the performance of the Relevant Functions and shall hold the

Company to account in respect of its performance of such functions pursuant to the

terms of the Services Contract.

1.5 The Parties have now agreed to enter into this MoU to record the following matters:

1.5.1 the agreed vision of the Parties in respect of the establishment of the

Company and the delivery of high quality and innovative children’s social

care services to children, young people and their families within the

Borough of Reading to meet the requirements of the Directions;

1.5.2 the key principles regarding the following:

(a) the proposed legal form of the Company;

(b) the proposed constitution of the board of directors of the Company

and associated corporate governance arrangements; and

(c) the operational framework within which the Company shall operate

and be held accountable, which will address key aspects of the

proposed Services Contract such as the development of the proposed

budget, performance framework and governance arrangements

between the Company and the Council;

1.5.3 the proposed timetable from the signing of the MoU, to the formal

establishment of the Company through to service commencement under

the Services Contract (the “Service Commencement Date”); and

1.5.4 the commitments of each Party in relation to the transition of children’s

social care and education support services to the Company and the

structures that the Parties have put in place to periodically review and

assess the progress of the Project against the agreed timetable and key

Project milestones (as more particularly described in paragraph 9 below).

1.6 The Parties do not intend this MoU to be legally binding or to create legal relations

between them. The Parties agree that they shall use all reasonable endeavours to

comply with the terms and the spirit of this MoU.

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2. Term

2.1 This MoU shall come into effect on the date it is signed by both Parties and

shall remain in force until the earlier of:

2.1.1 the Service Commencement Date; or

2.1.2 the date on which this MoU is terminated by either Party notifying the other

Party of such termination in writing,

the “Term”.

3. Key Representatives

3.1 The Parties shall (and shall procure that their key representatives as identified in

this paragraph 3 shall) work together in good faith and in a collaborative and co-

operative manner in order to achieve the establishment of the Company and the

delivery of the Project in accordance with the timetable set out in paragraph 9

below.

3.2 The Secretary of State will be represented by the following key persons:

3.2.1 the Commissioner (who shall perform the role as set out in the First

Direction); and

3.2.2 a senior civil servant in the Department for Education (as notified to the

Council in writing by the Commissioner from time to time).

3.3 The Council shall be represented by the following key persons:

3.3.1 the Chief Executive of the Council (or, where applicable, his replacement

from time to time during the Term); and

3.3.2 the Head of Customer Services (or, where applicable, her replacement from

time to time during the Term).

3.4 The Company shall be represented by the following key persons:

3.4.1 the Chair (as defined in paragraph 6.4.1 below or, where applicable, his/her

replacement from time to time during the Term); and

3.4.2 the Company Chief Executive (as defined in paragraph 6.4.2 below or,

where applicable, his/her replacement from time to time during the Term).

4. Stages of the Project

4.1 The Project shall consist of two distinct key stages as follows:

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4.1.1 the period from the date that this MoU is signed by both Parties up until the

Service Commencement Date (the “Shadow Period”); and

4.1.2 the period on and from the Service Commencement Date when the

Services Contract has been entered into by the Council and the Company,

all relevant staff have transferred from the Council to the Company and the

Company is fully operational and responsible for the performance of the

Relevant Functions pursuant to the Services Contract (the “Operational

Period”).

The Shadow Period

4.2 During the Shadow Period, the key representatives of the Council and the

Company (as further described in paragraph 3 above) and such other

representatives of the respective organisations, will work collaboratively with one

another (and in consultation with the Commissioner and the Secretary of State) to:

4.2.1 on or before 30 April 2018, establish the Company pursuant to paragraph 6

below and register the company at Companies House for the purpose of

preserving the identity of the Company with it not becoming operational

until the Service Commencement Date;

4.2.2 define a set of behaviours, values and measures to underpin the way the

Council and the Company will work together in respect of the Company’s

performance of the Relevant Functions during the Operational Period, and

which supports the development and establishment of a collaborative

relationship between the Council and the Company which achieves an

appropriate balance between the need for:

(a) the Council to be satisfied that the Company is appropriately

performing the Relevant Functions on its behalf; and

(b) the Company to have unfettered day-to-day operational independence

in respect of its performance and discharge of the Relevant Functions;

4.2.3 enable the Council to design, develop and establish an appropriate, robust

and efficient internal contract management function (the “Intelligent Client

Function”) for the purposes of monitoring the Company’s performance of

the Relevant Functions pursuant to the Services Contract but which does

not serve to fetter the operational independence of the Company; and

4.2.4 develop the following key documents based on the principles set out in

paragraph 4.2.2 above:

(a) a set of Articles of Association for the Company (the “Articles”) which

will, among other things, regulate the internal affairs of the Company

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and, in particular, will govern the relationship between the Council (as

the sole member of the Company (see paragraph 6.1 below)) and the

Company’s board of directors in respect of the operation and

management of the Company;

(b) a business plan for the Company, which will, among other things, set

out the strategic objectives of the Company for specified periods and

detail how the Company intends to achieve those strategic objectives

(the “Business Plan”);

(c) an appropriately balanced Services Contract pursuant to which the

Company will perform the Relevant Functions on behalf of the Council

from the Service Commencement Date; and

(d) appropriately balanced support services arrangements which will be

provided by the Council to the Company under a “Support Services

Agreement” to support the Company’s operations and its

performance of the Relevant Functions.

4.3 In addition, during the Shadow Period the Parties shall develop the “Governance

Side Agreement” (which is more particularly described in paragraph 6.16 below)

with any necessary input from the Company.

4.4 It should be noted that although the Articles, the Business Plan, the Services

Contract, the Support Services Agreement and the Governance Side Agreement

are developed between the Council, the Company and the Secretary of State (as

applicable) during the Shadow Period, these documents shall only have legal

effect once they are executed (or formally approved, in respect of the Articles) by

the relevant parties, which shall be on a date on or around the Service

Commencement Date.

The Operational Period

4.5 During the Operational Period, the Company will be fully operational and

responsible for the performance of the Relevant Functions on behalf of the

Council and the Services Contract, Support Services Agreement, Articles,

Business Plan and the Governance Side Agreement will all have legal effect

during the Operational Period.

4.6 It should therefore be noted that, pursuant to paragraph 2.1.1 above, this MoU will

terminate on the Services Commencement Date (if not terminated earlier in

accordance with paragraph 2.1.2) and therefore will not be in effect during the

Operational Period, unless otherwise agreed by the Parties in writing.

5. Objectives and Agreed Vision

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5.1 The Parties’ agreed vision is to establish the Company as a new and distinct legal

entity that is operationally independent of the Council, to provide high quality

children’s services across the Borough of Reading. The Company shall have day-

to-day operational independence in the performance and management of these

services and will be managed by a strong board of executive and non-executive

directors.

5.2 The Company will raise the profile of, and measurably improve, children’s social

care services in the Borough of Reading, providing expert support to managers,

staff and local stakeholders. The Council’s ambition is that the Company will

become a national leader in social work practice and training, putting safeguarding

and developing children’s life chances at the heart of everything that it does.

5.3 It is envisaged that the Company will work collaboratively with partners and key

stakeholders in a culture of social enterprise, to improve children’s social care

services for children, young people and their families within the Borough of

Reading at a time of financial constraint by combining a business-like commercial

discipline with a public service ethos. The Council and the Company will work with

partners to create local centres of excellence and use ICT solutions to provide

easy access to services and advice for children, young people and their families to

ensure efficient delivery of children’s services.

5.4 The Parties envisage that the Company’s ethos may be summarised as a “TEAM"

approach:

T – everyone together across all sectors in Reading putting children first;

E – efficient and effective use of public resources to maximise impact;

A – ambitious for Reading children, young people and their families and the

Company;

M – monitoring and measuring to make a difference to the life chances of

children, young people and their families.

5.5 The Parties acknowledge and agree the following:

5.5.1 the Company will have a key role to play in pursuing the agreed vision and

objectives of the Parties set out in paragraphs 5.1 to 5.4 (inclusive) above,

together with the Council and other key stakeholders; and

5.5.2 the Council and the Company will work collaboratively with all key

stakeholders to pursue the agreed vision and objectives,

and, during the Shadow Period, the Council and the Company will work together

in good faith to further develop the agreed vision and objectives described above

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so that they are capable of being transposed into the Company’s Articles and the

Services Contract as a statement of the Company’s objects and ‘shared vision’ (as

appropriate) in respect of the Company’s delivery of children’s services.

6. The New Organisation Model, Board Constitution and Decision-Making

Form of the Company

6.1 The Company will initially be established in a dormant and ‘shadow form’ as a

wholly-owned subsidiary company of the Council that is a company limited by

guarantee, with the Council as its sole member and the Commissioner as its sole

director. The Company shall remain in a dormant and ‘shadow form’ during the

Shadow Period and shall not be considered operational until it formally enters into

the Services Contract with the Council and commences the performance of the

Relevant Functions.

6.2 During the Shadow Period, and prior to the Company becoming operational, the

Articles of the Company shall be developed and revised so that, together with the

Services Contract, the Council is comfortable that the In-House Exemption will

apply to the award of the Services Contract to the Company by the Council and

also the entering into of any ancillary contracts between the Council and the

Company that may be applicable, including the Support Services Agreement.

6.3 The Parties agree that the model for the new Company must:

6.3.1 comply with the requirements of the Directions to secure the improvement

in the performance of the Council’s Relevant Functions insofar as they

relate to children’s social care and to provide confidence to the Parties

regarding the future delivery of high quality children’s social care services;

6.3.2 establish a new and distinct legal entity which has day-to-day operational

independence from the Council in the management and performance of

children’s social care services in the Borough of Reading through a strong

board of executive and non-executive directors;

6.3.3 enable the effective discharge at all times of the Relevant Functions in

respect of those children’s services that are the subject of the Services

Contract and to enable the Council, through its elected members or

otherwise, to properly discharge their local democratic accountability in

respect of the performance of the Relevant Functions within the Borough of

Reading through an appropriate and balanced contractual governance and

quality assurance framework in the Services Contract which enables:

(a) the Council to have sufficient assurance that the Relevant Functions

are being properly discharged by the Company on its behalf; and

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(b) the board of directors and executive management of the Company to

have sufficient flexibility to innovatively and independently perform the

Relevant Functions on behalf of the Council, and meet the changing

demands of children, young people and their families in the Borough of

Reading without undue interference from the Council;

6.3.4 focus on social objectives and the improvement of outcomes for children,

young people and their families in the Borough of Reading with the

treatment of any surpluses that are generated by the Company being

subject to negotiation between the Council and the Company and

documented in the Services Contract in accordance with an agreed

mechanism;

6.3.5 provide a structure that is lawful and within the scope of the Council’s legal

powers, including pursuant to Section 1 of the Children and Young Persons

Act 2008, the Contracting Out (Local Authority Education Functions)

(England) Order 2002 and which complies with The Public Contracts

Regulations 2015 and associated State Aid rules. To this end, the Council

agrees that the Company will register as an independent fostering agency

on or prior to the Service Commencement Date;

6.3.6 be capable of facilitating potential future business growth and working with

other public sector bodies/customers in accordance with applicable laws;

and

6.3.7 provide the most tax efficient structure possible in order to minimise

additional costs arising under the new model.

Constitution and Appointment of the Company’s Board of Directors

6.4 Subject to paragraphs 6.5 to 6.15 (inclusive) below, the board of directors of the

Company shall comprise the following:

6.4.1 a non-executive director of the Company appointed as chair of the

Company by the Secretary of State, in consultation with the Council, during

the period of the intervention (the “Chair”);

6.4.2 up to three (3) executive directors comprising the chief executive of the

Company (the “Company Chief Executive") and two other executive roles

(collectively referred to in this MoU as the “Executive Posts”);

6.4.3 up to six (6) non-executive directors with collective knowledge, expertise

and experience across the range of children’s services to be provided by

the Company, as well as business development (collectively referred to in

this MoU as the "Non-Executive Independent Directors" or "NEIDs");

and

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6.4.4 an additional non-executive director nominated by the Chief Executive of the

Council, who should be an officer of the Council (other than the Chief

Executive of the Council) (the “Council Nominated Director”).

6.5 In respect of the appointment of the Company Chief Executive, the Council, in

consultation with the Commissioner, is considering whether that person should

also be the Council’s Director of Children’s Services, or whether that person

should be an additional, independent appointment. This is one of a number of

options currently being considered by the Council, however, if the Council

determines that its Director of Children’s Services should also be the Company

Chief Executive, then that person shall remain employed by the Council and be

seconded into the Company as the Company Chief Executive (see paragraph

7.11 below). If it is agreed that the Council’s Director of Children’s Services will

also be the Company Chief Executive then notwithstanding such appointment, the

Council's obligation and discretion to appoint a Director of Children’s Services

pursuant to the Children Act 2004 shall not be fettered and the Council shall be

free, at any time, to appoint another person as its Director of Children’s Services

at its absolute discretion.

6.6 During the Shadow Period, the constitution of the board of directors of the

Company will commence in accordance with paragraphs 6.7 and 6.8 below and,

although such individuals are not directly appointed to or by the Company at this

stage, they will be appointed to the designated posts that they will be due to take

up on the board of directors of the Company (the "Designated Company

Board").

6.6A During the Shadow Period it is expected that the Designated Company Board

shall:

6.6A.1 in relation to the performance of the Relevant Functions during the Shadow

Period:

(a) act in an advisory capacity to the Council with the Company Chief

Executive informally reporting to the Designated Company Board during the

Shadow Period on the performance of the Relevant Functions and the

design of the services that will ultimately be provided by the Company from

the Service Commencement Date pursuant to the Services Contract; and

(b) be entitled to make recommendations to the Council in respect of such

matters so that the Designated Company Board may appropriately

influence the delivery and performance of such services to enable the

effective transition of the services to the Company on and from the Service

Commencement Date;

and

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6.6A.2 be responsible for working alongside the Council to ensure that the Company is in

a position to efficiently and effectively take over the performance of the Council’s

Relevant Functions pursuant to the Services Contract on and from the Service

Commencement Date.

6.7 Notwithstanding the appointment of the Designated Company Board as described

in paragraphs 6.6 and 6.6A above, during the Shadow Period the Council will

continue to be responsible for and directly perform and discharge the Relevant

Functions itself, and such functions shall not be performed and discharged by the

Company (or the Designated Company Board) until the Service Commencement

Date and the Parties acknowledge and agree that the Company shall not be

operational during the Shadow Period.

6.8 During the Shadow Period, any appointments to the Designated Company Board

shall be as follows:

6.8.1 the Secretary of State, in consultation with the Council, shall select the

person who will have the role of the Chair;

6.8.2 the Company Chief Executive shall be appointed by the Council with the

prior written consent of the Secretary of State;

6.8.3 the persons occupying Executive Posts (other than the Chief Executive)

shall be appointed by the Council in consultation with the Commissioner

and the Secretary of State;

6.8.4 the Non-Executive Independent Directors shall be appointed by a selection

committee comprised of the Chair, a representative of the Secretary of

State (which is likely to be the Commissioner) and a representative of the

Council; and

6.8.5 the Council Nominated Director shall be appointed by the Council in

consultation with the Commissioner,

and, where applicable, the recruitment process for such positions shall reflect

good practice for public appointments.

6.9 During the Operational Period, and only for so long as the Directions (or any

subsequent applicable statutory direction of the Secretary of State that replaces

any or both of the Directions) remain in force (the “Intervention Period"), the

following principles shall apply in respect of the appointment and/or removal of the

directors of the Company:

6.9.1 the Secretary of State shall, in consultation with the Council, nominate the

Chair of the Company whose formal appointment shall be made by the

Council following such nomination by the Secretary of State and, during

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the Intervention Period, the Secretary of State shall be solely responsible

for appointment and removal of the Chair and the remuneration of the

Chair; and

6.9.2 subject to paragraphs 6.5 and 7.11 of this MoU in relation to the

appointment of the Council’s Director of Children’s Services, the Council

shall obtain the prior written consent of the Secretary of State in relation to

any decision to appoint or remove the Company Chief Executive, as more

particularly described in paragraph 6.15.1(a) below.

Decision-Making and Reserved Matters

6.10 Subject to paragraph 6.11 below, during the Operational Period the board of

directors of the Company shall:

6.10.1 be fully empowered to manage the Company’s day-to-day business and

affairs in accordance with the Company’s approved Business Plan (from

time to time – see paragraph 4.2.4(b) above and paragraph 6.10.4 below).

6.10.2 make decisions on a majority basis only and, in the case of an equality of

votes, no director (including the Chair) will have a casting vote;

6.10.3 be expected to comply with their duties under the Companies Act 2006 in

relation to their decision-making, including the duty to promote the

success of the Company; and

6.10.4 in consultation with the Council develop a Business Plan in accordance

with paragraph 4.2.4(b) above and on an annual basis refresh and update

the Business Plan for approval by the Council pursuant to paragraph

6.11.3 below.

6.11 In addition to its statutory rights under the Companies Act 2006 (and associated

legislation) and subject to paragraphs 6.12 to 6.15 (inclusive) below, during the

Operational Period the Council shall have a right to approve the following key

decisions of the Company:

6.11.1 subject to paragraphs 6.9, 6.15.1(a) and 6.15.1(b) (as applicable) of this

MoU the appointment and removal of the Company’s directors;

6.11.2 any change to the membership of the Company;

6.11.3 the approval of the Company’s Business Plan (including the approval of

any amendments to the Company's Business Plan);

6.11.4 any changes/amendments to the Company’s Articles;

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6.11.5 the voluntary winding up of the Company (save where the Company is

insolvent and action is necessary by the directors of the Company in order

to comply with their statutory duties or to avoid potential civil or criminal

liability);

6.11.6 any proposal by the Company to enter into (or the entering into by the

Company) of any new third party contracts for the provision of services by

the Company to third parties above a pre-agreed threshold (which are

outside the scope of the Services Contract and/or the Company’s

Business Plan);

6.11.7 any proposal by the Company to enter into any other contractual

arrangement with the Council for the provision of other services to the

Council following the Service Commencement Date (unless otherwise

expressly provided for in the Services Contract, including pursuant to any

change mechanism therein); and

6.11.8 any proposal by the Company to form or procure the formation of any

other legal entity or undertaking in which the Company would be a

member, shareholder or hold any analogous position in any jurisdiction;

together the “Reserved Matters”.

6.12 The Parties acknowledge and agree that, during the Shadow Period, the Council

and/or the Company may identify and collaboratively agree on additional matters

that should be added to the list of Reserved Matters set out in paragraph 6.11

above for inclusion in the Company’s Articles (“Additional Reserved Matters”),

and when identifying and agreeing any Additional Reserved Matters with the

Company the Council shall:

6.12.1 have regard to the fundamental principle of the operational independence

of the Company; and

6.12.2 subject to paragraph 6.13 below, consult the Secretary of State (or his

nominee, where applicable) prior to formally agreeing any Additional

Reserved Matters with the Company.

6.13 Following consultation with the Secretary of State (or his nominee) pursuant to

paragraph 6.12.2 above, the Secretary of State shall be entitled to request

consent or consultation rights over any Additional Reserved Matters to the extent

that the Secretary of State reasonably believes that such rights are necessary.

Following any such request by the Secretary of State, the Parties shall agree

(acting reasonably and having due regard to the principles set out in paragraphs

6.12.1 and 6.16 of this MoU) such consent/consultation rights over any Additional

Reserved Matters and such rights shall be exercisable by the Secretary of State

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during the Intervention Period. No Additional Reserved Matters can be agreed

between the Council and the Company until the process set out in paragraph

6.12.2 and this paragraph 6.13 has been followed.

6.14 The Reserved Matters (including any Additional Reserved Matters agreed

between the Council and the Company pursuant to paragraphs 6.12 and 6.13

above), and the Council's rights in respect of the same, will be set out in the

Articles.

The Secretary of State’s consent/consultation rights in respect of the Reserved Matters

6.15 During the Intervention Period, the Secretary of State shall have:

6.15.1 consent rights in respect of the following Reserved Matters:

(a) the appointment and removal of the Company’s Chair;

(b) subject to paragraphs 6.5 and 7.11, the appointment and removal

of the Company Chief Executive;

(c) any change to the membership of the Company;

(d) the voluntary winding up of the Company (save where the

Company is insolvent and action is necessary by the directors of

the Company in order to comply with their statutory duties or to

avoid potential civil or criminal liability); and

(e) any other consent rights agreed between the Parties pursuant to

paragraph 6.13 above;

6.15.2 consultation rights in respect of the following Reserved Matters:

(a) the approval of the Company’s Business Plan (including the

approval of any amendments to the Company's Business Plan);

(b) any changes/amendments to the Company’s Articles;

(c) any proposal by the Company to enter into (or the entering into by

the Company) of any new third party contracts for the provision of

services by the Company to third parties above a pre-agreed

threshold (which are outside the scope of the Services Contract

and/or the Company’s Business Plan);

(d) any proposal by the Company to enter into any other contractual

arrangement with the Council for the provision of other services to

the Council following the Service Commencement Date (unless

otherwise expressly provided for in the Services Contract,

including pursuant to any change mechanism therein);

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(e) any proposal by the Company to form or procure the formation of

any other legal entity or undertaking in which the Company would

be a member, shareholder or hold any analogous position in any

jurisdiction; and

(f) any other consultation rights agreed between the Parties pursuant

to paragraph 6.13 above.

6.16 The consent and consultation rights of the Secretary of State described in

paragraph 6.15 above (or any additional consent/consultation rights requested

and afforded to the Secretary of State pursuant to paragraph 6.13 above) are only

exercisable during the Intervention Period and are intended to preserve the

integrity of the intervention pursuant to the Directions, and shall be set out in a

legally binding agreement between the Council and the Secretary of State (the

“Governance Side Agreement”) to be entered into between the Parties on or

before the Company’s Articles are adopted and the Services Contract is entered

into between the Council and the Company. The Governance Side Agreement

will, among other things, manage the exercise by the Secretary of State of such

consultation and consent rights and will stipulate time periods within which the

Secretary of State (or his duly appointed nominee) must respond to the Council in

respect of its exercise of such rights.

7. The Services Contract

7.1 On or around 30 September 2018 the Council will enter into an arm’s length

Services Contract with the Company awarded to the Company in accordance with

the In-House Exemption. The Services Contract shall be for a term of seven (7)

years with an option to break after five (5) years. Under the Services Contract, the

Company (in the capacity of a ‘supplier’) will be required to perform the Relevant

Functions on behalf of the Council (in its capacity as the ‘customer’). The Council

will remain statutorily responsible and accountable for the discharge of the

Relevant Functions and the Company will be accountable to the Council in respect

of the performance of the Relevant Functions pursuant to the terms of the

Services Contract.

7.2 The current proposed scope of children’s services to be delivered by the Company

is set out in Part A (List of Transferring Services) to Appendix B of this MoU. In

addition, Part B (Relevant Support Services) to Appendix B of this MoU sets out

the current proposed scope of relevant support services that the Company will

require in order for it to be able to perform its obligations under the Services

Contract. It is acknowledged that the content of Appendix B remains subject to

ongoing review and, in particular, subject to paragraphs 7.4 and 7.5 below the

Council and the Company will work together during the Shadow Period to

collectively determine which of these support services will be directly performed by

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the Company and which will be purchased by the Company from the Council via

the Support Services Agreement.

7.3 The Parties acknowledge and agree that the Council currently discharges its

statutory duties relating to adoption via a joint adoption agency agreement led by

Oxfordshire County Council, and therefore the Council’s statutory functions in

respect of adoption will be retained by the Council and will not fall within the scope

of, or form part of, the Services Contract and accordingly will not be performed by

the Company on the Council's behalf.

7.4 The outline scope of the support services which are to transfer to the Company

and those support services which are to be purchased by the Company from the

Council pursuant to the Support Services Agreement between the Council and the

Company shall be determined by the Council‘s Policy Committee in consultation

with the Commissioner by the end of May 2018. Those support services which are

not transferred to the Company shall be purchased by the Company from the

Council for a minimum period of two (2) years from the Service Commencement

Date, on the basis of a one year term with a twelve (12) month notice period to

terminate the arrangement thereafter.

7.5 It is recognised that the Council’s Joint Legal Service (through the Joint Legal

Team) under existing arrangements and agreements advises and represents the

Berkshire Authorities, including Reading, in connection with children’s and adults’

social care services which include care proceedings, fostering, assessment of

adopters or carers for permanency and special education tribunals etc. Therefore,

the Joint Legal Service shall also be purchased by the Company from the Council

on a similar basis to that described in paragraph 7.4 above (i.e. one year term with

a twelve (12) month notice period to terminate thereafter), however special

arrangements will apply to the Joint Legal Service as a twelve (12) month notice

period will also be required to significantly reduce its scope.

7.6 During the Shadow Period an outcomes-focused service specification and

associated contract governance and performance framework, which shall include

appropriate performance metrics, will be jointly developed and agreed by the

Council and the Designated Company Board in consultation with the

Commissioner and the Secretary of State, in respect of the delivery of children’s

services by the Company. The services specification and performance and

governance frameworks will be key components of the Services Contract.

7.7 During the Intervention Period the Secretary of State will have the following rights

in respect of the Services Contract:

7.7.1 consent rights in respect of any proposal:

(a) to terminate the Services Contract;

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(b) to extend or exercise a break right under the Services Contract;

(c) to make any major variation to the Services Contract (outside pre-

agreed thresholds);

(d) by the Company to subcontract a substantial part of the services it is

performing under the Services Contract to a third party;

(e) by the Company to assign, novate or otherwise dispose of its rights

under the Services Contract;

(f) by the Council to exercise any rights of ‘step-in’ it has under the

Services Contract; and

7.7.2 a consultation right in respect of any proposal by the Council to ‘step-out’

under the Services Contract following the exercise by the Council of any

‘step-in’ rights it may have.

7.8 The consent and consultation rights of the Secretary of State described in

paragraph 7.7 above shall be capable of being exercised by the Secretary of State

through ‘Third Party Rights’ provisions to be contained within the Services

Contract. Furthermore, the exercise of these rights will be governed by the

Governance Side Agreement.

TUPE/Employment and Pensions

7.9 The persons on the Designated Company Board who hold Executive Posts shall

be employed by the Council during the Shadow Period and on the Service

Commencement Date such persons will transfer to the Company pursuant to the

Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”).

7.10 In addition to the transfer of the Executive Posts as described in paragraph 7.9

above, on the Service Commencement Date there shall be a transfer of relevant

and appropriately assigned staff from the Council to the Company pursuant to

TUPE. The scope of the transferring services and the design of the Council’s

retained Intelligent Client Function will determine the scope of this TUPE transfer.

The Council will be responsible for all pre-transfer employment liabilities of the

transferring staff and the Company will be responsible for all post-transfer

employment liabilities of such transferring staff insofar as they relate to their

employment by the Company following the relevant transfer date.

7.11 If it is determined pursuant to paragraph 6.5 that the Company Chief Executive will

also be the Director of Children’s Services at the Council, then the relevant post

holder will remain an employee of the Council and will be seconded to the

Company as its Chief Executive in accordance with the terms of a secondment

agreement to be entered into between the Council and the Company in respect of

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such individual. Under that secondment agreement, the Company will have the

necessary day-to-day control in relation to the performance and management of

the Company Chief Executive’s role and tasks. The Parties envisage an 80/20

split of time between Company Chief Executive duties and Director of Children’s

Services duties (with the majority being dedicated to the former) in relation to this

role. If, pursuant to paragraph 6.5, the Council decides to appoint (in its absolute

discretion) another individual as its Director of Children’s Services, then it is

envisaged that the Company Chief Executive who was previously also the

Council's Director of Children's Services will continue to act as the Company Chief

Executive but will become an employee of the Company.

7.12 It is acknowledged that all staff assigned to the performance of statutory functions

relating to adoption shall be retained by the Council and will not be transferred to

the Company in accordance with TUPE as the Council will be retaining all its

statutory functions that relate to adoption.

7.13 The Council is currently in the process of considering its options in relation to

matters concerning pensions and is seeking actuarial advice. It is envisaged that

the Company will either secure “admitted body status” or be a "designated body"

(for the purposes of part 2, schedule 2 of the Local Government Pension Scheme

Regulations 2013) in relation to the Local Government Pension Scheme (LGPS),

however further work on pensions matters is required before anything further can

be said.

8. Finance

Transition Costs

8.1 The Parties shall enter into a funding agreement by 31 March 2018 in respect of

the Secretary of State’s contribution to the funding of the transition costs in

respect of the set-up and establishment of the Company. For these purposes, it is

agreed that the following non-exhaustive list of cost headings shall be eligible to

be treated as transition costs in respect of which the Secretary of State shall

contribute:

8.1.1 project management costs;

8.1.2 set-up of Company (including appointment costs in respect of the board of

directors of the Company);

8.1.3 legal advice and support;

8.1.4 finance advice and support (including the relevant set-up costs in respect of

the Council’s Fusion finance system);

8.1.5 HR advice and support;

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8.1.6 communications (with staff and third parties);

8.1.7 set up of accommodation for the Company;

8.1.8 transfer of data and ICT set-up costs;

8.1.9 support services (including changes to business processes and transfer of

contracts); and

8.1.10 development of the Council’s retained commissioning and contract

management function.

8.2 A key principle will be that the relevant transition costs should be “additional costs”

only – i.e. costs that are a direct result of setting up the Company to deliver the

Services Contract, as opposed to costs that the Council would otherwise ordinarily

incur if the Company was not being established.

The Company’s Budget

8.3 The Council is in the process of setting its three (3) year Medium Term Financial

Strategy for the period of 2018 to 2021 and, as part of that process, has agreed

an indicative 3-year budget/financial plan for the Company as more particularly

described in the table below. This indicative budget remains subject to overall

financial settlement from Central Government being as predicted and therefore

remains subject to ongoing review.

8.4 This indicative plan excludes the costs of support services and has been set to

meet recent growth in demand in children’s services and to allow a clear twelve

(12) month period to implement efficiency savings. All local authorities in

intervention have seen a rise in costs, but as the children’s social care services

move from inadequate to good, there should be an opportunity to reduce the costs

of looking after children. Furthermore, Central Government has set targets for

Local Government to reduce costs and therefore the Council’s Medium Term

Financial Strategy shows a planned reduction in the budget in 2020/21, and

accordingly the Company we will be required as part of its business planning

process to set targets for efficiency savings which will help to manage the strain

on the Council’s limited finances and to ensure that children’s social care services

improve.

DCEEHS* 18-19 Budget (Draft) 19-20 Budget (Draft) 20-21 Budget (Draft)

excluding DSG 41,566,000 42,272,400 41,632,000

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8.5 The Council will work with the Designated Company Board during the Shadow

Period to identify the costs of providing support services to the Company, which

the Council wishes to ensure are of the correct quality to enable the company to

perform its obligations under the Services Contract. For the avoidance of doubt,

the final budget for the Company will include the costs of the required support

services.

Approach to VAT

8.6 As part of the process of securing the most tax efficient structure possible for the

Company, and based on similar alternative delivery models of this nature (i.e. that

are not just the simple provision of welfare and education services but include

many additional aspects the successful fulfilment of which relates to the discharge

of the Council’s functions as a whole), the understanding between the Parties is

that Company will be delivering a single supply of taxable services to the Council

and should be entitled to fully recover VAT it incurs on the cost of making that

supply.

8.7 The Parties will continue to assess the VAT position during the Shadow Period

and where, for whatever reason, whether during the Shadow Period and/or during

the Intervention Period, HMRC or another relevant tax authority makes a

determination that would result in the Company having an irrecoverable VAT issue

in respect of the delivery of the children’s services under the Services Contract,

then the Parties shall come to an agreement such that the Council and the

Company are not liable for any irrecoverable VAT costs that may be associated

with the delivery of the children’s services pursuant to the Services Contract. Any

such agreement will only be in relation to any irrecoverable VAT costs during the

Intervention Period and not thereafter.

9. Key Project Milestones and Management of the Project

9.1 The Parties shall use all reasonable endeavours to achieve the following key

milestones as part of the proposed timetable for this project (these are merely

anticipated dates):

9.1.1 recruitment and appointment of the Chair by 30 March 2018 (subject to a

successful executive search and identification of candidates);

9.1.2 recruitment and appointment of the remainder of the Designated Company

Board by 30 April 2018 (subject to a successful searches);

9.1.3 the Designated Company Board operating in ‘shadow form' by 1 May 2018

(subject to appointment of positions to the Designated Company Board);

9.1.4 budget for the Company to be agreed by 28 September 2018;

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9.1.5 Articles of the Company to be revised and finalised by 28 September 2018;

9.1.6 Council approval of the Services Contract and ancillary documents by 28

September 2018; and

9.1.7 the Services Contract and Governance Side Agreement to be executed by

30 September 2018.

9.2 During the Shadow Period the Project shall be periodically monitored, reviewed

and effectively managed through the following key groups:

9.2.1 the Strategic Stakeholder Group – which will meet monthly (or as

otherwise agreed) and will provide input into the overall strategic direction

of the Project. This group will be chaired by the Commissioner and key

attendees at this group will be:

(a) representatives of the Secretary of State;

(b) the Chief Executive of the Council;

(c) the Council’s Director of Children’s Services (if such person is not also

the Company Chief Executive); and

(d) the Company Chief Executive (if such person is not also the Company

Chief Executive);

9.2.2 the RBC Commissioning Group – which will meet monthly (or as

otherwise agreed) and which will oversee the delivery of the Project on

behalf of the Council and will be accountable for the delivery of the Project.

This group will be chaired by the Chief Executive of the Council and key

attendees at this group will be:

(a) the Council’s Director of Finance;

(b) the Council’s Head of Legal; and

(c) the Council’s Director of Children’s Services; and

(d) the Council’s Head of Customer Services;

9.2.3 the Project Board – which will meet fortnightly and which will manage the

project plan, track Project risks and issues and generally support the

Project and which will report directly to the RBC Commissioning Group.

This group will be chaired by a nominated representative and key attendees

at this group will be:

(a) the Project Manager for the Project;

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(b) the Council’s Head of Customer Services;

(c) the Council’s project support officer; and

(d) all workstream leads at the Council.

10. Miscellaneous

10.1 Subject to paragraph 1.6, both Parties agree to act at all times in good faith and in

the spirit of mutual trust and co-operation in relation to the delivery of the project in

accordance with the terms of this MoU.

10.2 The Parties shall agree the scope and confidentiality of the information sharing

which shall take place during the period of this MoU, including access to the

Council’s financial and management reporting records and systems.

10.3 The Parties agree that the Council shall lead on all external communications in

respect of this Project during the period of the MoU in consultation with the

Secretary of State and the Commissioner. Save for the purposes of public

decision making and/or where required by law, neither Party shall issue any public

statements or announcements in respect of this Project without the prior

agreement of the other Party.

10.4 The Parties may vary the terms of this MoU at any time by the agreement of both

Parties in writing.

10.5 Any dispute that may arise as to the interpretation or application of this MoU shall

be settled by discussion between the Parties. Both Parties agree to use all

reasonable endeavours to seek to resolve any such dispute.

Signed _____________________

Nick Whitfield

The Commissioner for Children’s Services (on behalf of the Secretary of State)

Date _______________________

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Signed _____________________

Peter Sloman

Chief Executive

Reading Borough Council

Date _______________________

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Appendix A

The Direction

Direction to Reading Borough Council in relation to children’s services:

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Classification: OFFICIAL-SENSITIVE

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Appendix B

Part A: The List of Transferring Services

• Single Point of Assessment (including Child Sexual Exploitation Hub and Multi

Agency Safeguarding Hub)

• Access & Assessment

• Children in Need (including Edge of Care)

• Looked After Children (including Leaving Care and Contact)

• Fostering Services

• Residual adoption services (non-Regional Adoption Agency functions)

• Residential Units

• Independent Reviewing Officers & Child Protection Chairs

• Youth Service

• Youth Offending Service

• Early Help

• Early Years

• Children’s Centres, Under 5s & Nurseries

• Special Education Needs & Disabilities

• Children & Young People with Disabilities

• Education Services & School Support Services (including School Admissions &

Pupil Place planning)

• Virtual Head

• Educational Welfare

• Educational & Child Psychologists

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Part B: Relevant Support Services (either transferring or being purchased from the

Council as Support Services)

The Council and the Company will collectively determine which of these support services

will be directly performed by the Company and which will be purchased by the Company

from the Council via a support service arrangement.

1. Strategic HR – Advice

2. Employment and Recruitment

3. Learning and Workforce Development

4. Payroll & Pensions

5. Occupational Health

6. Finance

7. Accounts Payable and Receivable

8. Procurement

9. Audit and Investigations

10. ICT Services

11. Health and Safety

12. Legal and Democratic Services (incl. Information Governance)

13. Joint Legal Team

14. Housing and Property Services

15. School Services and Capital Programmes

16. Regulatory Services

17. Emergency Planning, Risk and Business Continuity

18. Building Cleaning Services

19. Transportation and Waste

20. Sustainability

21. Facilities Management (Incl. Pool Cars)

22. Marketing and Communications

23. Income and Assessment

24. Project and Change Management

25. Kennet Day Nursery

26. Customer Services (incl. Complaints)

27. Strategic Commissioning

28. Operations & Support

29. Performance and Data Management

30. Reviewing and Quality Assurance

31. Home to School Transport

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3. CHILDREN

(1) To be the Lead Councillor for all Children’s services under Section 19(1) of the ChildrenAct 2004; to be accountable for their delivery including when this is delivered by theChildren’s Company, Brighter Future for Children; and to exercise politicalresponsibility for the effectiveness, availability and value for money of all of theCouncil’s children’s services.

[NB – the Children Act 2004 specifies that these functions are also the responsibility ofthe Director of Children’s Services]

a) Education services – the authority’s functions in its capacity as a localeducation authority, except those excluded under Section 18(3) of the Act(namely certain functions relating to further education, higher education andadult education)

b) Social Services – the authority’s social services functions within the meaning ofthe Local Authorities Social Services Act 1970, insofar as they relate tochildren, and the local authority’s functions for children and young peopleleaving care

c) Health Services – any health-related functions exercised on behalf of an NHSbody under Section 31 of the Health Act 1999, insofar as they relate to children

d) Inter-agency Co-operation – the new functions of the Children’s ServicesAuthority set out in the Children Act, in particular building and leading thearrangements for inter-agency cooperation set out in (e) below.

e) The following functions conferred on Children’s Services Authorities under theChildren Act 2004:

o Section 10 – promoting co-operation with partner organisations toimprove the well-being of children within the authority’s area

o Section 11 – safeguarding children and promoting their welfareo Section 12 – establishing maintaining and operating a database of basic

information on children in the authorityo Sections 13-16 – establishing a Local Safeguarding Children’s Boardo Section 17 – preparing and publishing a Children and Young People’s

Plan setting out the authority’s strategy for discharging its functions re.children and young people

o Section 20(9)(d) – consulting on and co-ordinating statements ofproposed action in the light of a Joint Area Review report andmonitoring and evaluating implementation

f) The following functions that have been modified by the 2004 Act:

o Schedule 2 - seconding at least one Children’s Social Worker and atleast one education professional to the Youth Offending Team (Section39(5) of the Crime & Disorder Act 1998)

o Section 50 – duty to promote the educational achievement of looked-after children (Section 22(3)(A) of the Children’s Act 1989)

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o Section 52 – duty to provide the Secretary of State with information onindividual children where so directed (Section 83(4A) of the Children’sAct 1989

g) The role of the Lead Member for Children’s Services is set out in detail inStatutory Guidance issued in 2009 - The role and responsibilities of the LeadMember for Children’s Services and the Director of Children’s Services.

Brighter Futures for Children

(2) To work with the Director for Children, Education & Early Help and the Chief Executiveand Chair of Brighter Futures for Children to establish the Children’s Company forReading, and be accountable for its delivery of the Children’s Services functions of theauthority covered by the service contract.

(3) To ensure the effective commissioning and clienting of the contract with ‘BrighterFutures for Children’ for the delivery of the following functions of the Council asChildren’s Services Authority covered by the service contract:

Children’s Safeguardingo Child protectiono Children’s single point of access, including the Child Sexual Exploitation

(CSE) Hub and Multi-Agency Safeguarding Hub (MASH)o Access and assessmento Children in Need and Court teamso Looked-after Children, including Leaving Care and Contact Teamo Edge of careo Family placements, including fosteringo Residential Care

Early Help and Partnershipso Early Help Serviceo Early Years and Play Services, including Family Information Service,

Children’s Centres and care for Under-Fiveso Youth serviceo Youth Offending Service, including Troubled Families programmeo Teenage conception reduction and support to teenage parentso Young People not in education, employment or training (NEET)o Support to children and young people in conflict with the law through

the Youth Offending Service, Source and other Safer Communitiesinitiatives (jointly with Neighbourhoods & Housing, Culture & Sport).

Special Educational Needso Children & Young People’s Disability Teamo Special Educational Needs (SEND) – including exclusion and ill-healtho Support to children with disabilities and mental health problemso Children’s Action Teams which deliver family support for Children in

Need, education welfare, educational and child psychology and youthengagement services

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Classification: OFFICIAL APPENDIX C

READING BOROUGH COUNCIL LEAD COUNCILLOR PORTFOLIOS

Page 3

o Young carerso Children missing educationo Young runawayso Elective Home Educationo Post-16 learningo Behavioural Supporto Nurseries

Quality Assurance & Improvemento Ensuring the proper exercise of the role of Local Authority Designated

Officer (LADO)o Audit and Quality Assuranceo Employment, management and supervision of IROso Business operation and support

(4) In conjunction with ‘Brighter Futures for Children’:

a) To be proactive in developing the local vision and driving improvements forlocal people, including integrated children’s services, with children, youngpeople and their families placed at the centre of their policies and activitiesand to communicate this vision for children to councillors, and to the boardsand partnerships on which they are either present or represented.

(b) To provide a particular focus, with the Director of Children, Education & EarlyHelp Services and the Chief Executive of the Children’s Company, ‘BrighterFutures for Children’, on safeguarding and promoting the welfare of childrenacross all agencies: the responsibilities of the Chief Executive of the Company,the Director and Lead Councillor extend to all children receiving services intheir area, irrespective of the type of school they attend, or their home localauthority area.

(c) To develop, promote and implement policies, strategies and proceduralarrangements to champion children’s interests both across functionalboundaries within the local authority and across local partnerships to ensurethat the needs of all children and young people, including the mostdisadvantaged and vulnerable, and their families and carers, are addressed,with a particular focus on promoting early identification and preventionthrough:

effective coordination between Council services; effective consultation and co-operation between the Council and the

police, PCT, other Health Trusts, Probation Service, Connexions, theChildren and Family Court Advisory Service, the Learning & Skills Counciland the voluntary and community sector;

active leadership of the Reading Children’s Trust; effective integrated and strategic commissioning, leading to integrated

service delivery; active membership of the Local Safeguarding Children Board.

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Classification: OFFICIAL APPENDIX C

READING BOROUGH COUNCIL LEAD COUNCILLOR PORTFOLIOS

Page 4

(d) To oversee the development and implementation of the Children and YoungPeople’s Plan and related strategies and policies

(e) To oversee the implementation of the following corporate strategies andpolicies:

14-19 Strategy Children & Young People’s Plan Children in Care Pledge Early intervention strategy Play Strategy (with Culture & Sport) Learning Difficulties and Disabilities Strategy (with Education)

(f) To be satisfied that the discharge of the authority’s statutory children’sservices’ functions by Brighter Futures for Children is effective by:

ensuring regular access to reports and management data and askquestions about performance and outcomes

monitoring outputs for services against the inspection requirementsdeveloped by the Office for Standards in Education (Ofsted) and theCommission for Healthcare Audit and Inspection (CHAI)

developing performance management arrangements that deliver sharedand agreed outcomes across services that work with children and youngpeople.

(5) To ensure the direct provision of the following children’s services:

Commissioning Children’s Public Health 0-19 services, including health visitingand school nursing

Adoption – through Adopt Thames Valley – and post-adoption support

(6) To be consulted on, and oversee and monitor the responses from Brighter Futures forChildren to inspections and consultation undertaken by external bodies eg OFSTED andCare Quality Commission on children’s service provision in Reading, and ondevelopments outside Reading affecting residents in Reading

Corporate Parenting

(7) To contribute to, and be satisfied that the local authority demonstrates, high standardsof corporate parenting, in particular by encouraging Members to promote theeducational achievement and health and well-being of looked after children andchildren leaving care

D50

Classification: OFFICIAL APPENDIX C

READING BOROUGH COUNCIL LEAD COUNCILLOR PORTFOLIOS

Page 5

5. EDUCATION

(1) To develop, promote, and implement policies, strategies, and procedural arrangementsfor the provision of the Council's educational institutions, including the Council’sscheme for the financing of schools.

(2) To work with the Director for Children, Education & Early Help and the Chief Executiveand Chair of Brighter Futures for Children to establish the Children’s Company forReading and be accountable for its delivery of the Education functions of the authoritycovered by the contract.

(3) To ensure the effective commissioning and clienting of the contract with ‘BrighterFutures for Children’ for the delivery of the following functions of the Council as LocalEducation Authority covered by the service contract:

Planning of school places School admissions and appeals Elective education Commissioning high needs places School Improvement, including Governor Support, Advisory Services and

Educational Welfare School Improvement Support, including Careers Advice, Occupational Health,

(4) To ensure the provision of the following education services:

Maintenance and development of maintained school buildings, including capitalschemes for new school buildings

The Academisation programme, including conducting competitions for new Freeschools

Finance/IT support for schools, including the management of the DedicatedSchools Grant (DSG)

New Directions Service Home-to-school transport

(5) To oversee the development and implementation of the following strategies andpolicies, in conjunction with Brighter Futures for Children where appropriate:

Learning Difficulties and Disabilities Strategy (with Children & Families) Adult Learning Plan School Improvement Strategy Berkshire Post-16 Partnership Plan

(6) To work in partnership with Brighter Futures for Children, neighbouring local educationauthorities, maintained schools, Academies, Free schools, the Regional SchoolsCommissioner and other educational providers to promote high educational standardsand opportunities within Reading and for Reading children, and to ensure that theCouncil as local education authority is able to meet its statutory duties to ensure theeffective education of all local children.

(7) To co-ordinate and monitor the nomination and/or the appointment of Boroughrepresentatives on School Governing and other Educational Bodies.

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Classification: OFFICIAL APPENDIX C

READING BOROUGH COUNCIL LEAD COUNCILLOR PORTFOLIOS

Page 6

(8) To be consulted on, and oversee and monitor, the responses by Brighter Futures forChildren to inspections and consultation undertaken by external bodies eg DfE, OFSTEDand the LGA on education provision by schools in Reading, and provision outsideReading affecting residents in Reading

(9) To promote good community relations and consultation, with particular reference tothe following partnerships and key stakeholders in the Education Service, parents,governors, teachers and the voluntary sector:

Children’s Trust Berkshire Post-16 Partnership

(10) To monitor and challenge Brighter Futures for Children and schools with regards to:

Standards and attainment. Inclusion Budgets Ofsted outcomes to be good or outstanding.

(11) To be responsible for the following environmental health and public protectionlegislation and services within the Borough:

Environmental education and health promotion (with Health, Wellbeing &Sport)

School Transport Drivers’ Licences

D52

Classification: OFFICIAL APPENDIX D

READING BOROUGH COUNCIL TERMS OF REFERENCE OF COMMITTEES

ARTICLE 7 – COMMITTEES CHANGES REQUIRED BY ESTABLISHMENT OF CHILDREN’S COMPANY

7.2.1 There will be Standing Committees, as follows: (additional wording shown in italics)

Committee Purpose Policy Oversight of strategy, policy and budget

Covering all services in the Chief Executive’sOffice and Resources Directorate

Voluntary sector grants Economic development and regeneration Corporate land, buildings and assets – including

where the Council is Trustee Overview of service performance and

improvement across all Council services Partnerships: LSP (Community Strategy), LEP,

Reading UK CIC, City Deal, Cultural Strategy Decisions cutting across service committee areas Any decision between committee meetings, on an

urgency basis Sole Member / Owner for Brighter Futures for

Children

Adult Social Care, Children’s Services & Education

Covering personal services of the authority – AdultCare, Children’s Social Care, Education &Commissioning, School Improvement

Oversight of the RBC Client function for BrighterFutures for Children

Schools – involvement of Church and SchoolGovernor representatives

Adult Education – New Directions Health scrutiny Safeguarding responsibilities for children and

adults Partnerships: Children’s Trust, Post-16 joint

arrangement Corporate Parent

7.12 Terms of Reference of Standing Committees

2. ADULT SOCIAL CARE, CHILDREN’S SERVICES & EDUCATION COMMITTEE

(1) To be the authority’s Education and Social Services Committee.

D53

Classification: OFFICIAL APPENDIX D

READING BOROUGH COUNCIL TERMS OF REFERENCE OF COMMITTEES

(2) To be responsible for the statutory and non-statutory functions relating to theservices and areas of responsibility listed below, and to set the policy frameworkfor those functions for which the Committee is responsible:

Adult Social Care Support or health services to vulnerable adults provided by the local

authority Assessment of need, and commissioning services (including joint

commissioning) for: vulnerable adults older people People with mental health problems People with learning disabilities People with physical disabilities

Carers’ support Charging for social care and support services Safeguarding adults

Children’s Services Adoption Children’s public health – health visiting and school nursing Corporate parenting

Education Maintenance and development of maintained school buildings, and

new school building School Finance, including Dedicated Schools Grant Adult education and lifelong learning – New Directions Home-to-school transport

Health The Health Scrutiny function (see below), except scrutiny of “Quality

Accounts” from Acute sector which is delegated to the Health andWellbeing Board

(3) To be responsible for oversight of the RBC client function of the service deliverycontract with Brighter Futures for the delivery of the Council’s children’s socialcare, early years and education services covered by the contract, and thegovernance of the children’s company:

Children’s Services Support services to children provided by the local authority Fostering Behavioural support Child protection Children missing education Day nurseries and nursery education Early Years services – including Children’s Centres Educational psychology Family support services Learning disabilities and mental health services for children Looked-after children and care leavers

D54

Classification: OFFICIAL APPENDIX D

READING BOROUGH COUNCIL TERMS OF REFERENCE OF COMMITTEES

Play service Safeguarding children Special Educational Needs (SEN services) Teenage pregnancy and support Young carers Young people not in education, employment or training (NEETs) Youth offending Youth services

Education Primary and secondary education Careers development – and post-16 planning Commissioning education services Governor support School admissions and planning for places School attendance School improvement School services – including catering

(4) To be responsible for the following joint arrangements and partnerships in whichthe authority is involved:

o Academies, free schools and other educational providerso Children’s Trusto Berkshire Post-16 Partnership

(5) To be responsible for the overview, service performance and improvement andscrutiny of all functions for which the Committee is responsible.

(6) To undertake the health scrutiny functions of the local authority under Section244 of the National Health Services Act 2006 as amended by Sections 190 and191 of the Health & Social Care Act 2012.

(7) To provide a corporate framework for the scrutiny of Children’s Services as setout in the Children Act 2004 and to ensure effective accountability for providinga focus on the needs of children across all services of the Council, and theintegration of all public services provided to children by the Council, health andother partners.

D55

Appendix E(i): The Civic Offices – Brighter Future for Children - Headquarters

D56

Appendix E(ii): Whitley Health Building Proposed Floor Plan

D57

Appendix E(iii) - Brighter Futures for Children – Property Summary Building Shared or full occupancy % of the building

that BFfC occupy % of the shared space within the building that BFfC have access to

Whitley Health Building Full occupancy 100% 100% The Civic Offices Shared building 30% 30% The Avenue Centre Shared building Varies for each floor of the building.

Southcote Youth and Community Centre Shared building due to become a community hub.

5% 18%

Ranikhet – Children’s Centre – West Shared building 15% 0%

South Reading Youth Centre – South Reading Children’s Centre Shared building due to become a community hub.

46% 4%

Katesgrove Children's Centre, Elgar Road Shared building 60% 20% Southcote Childrens Centre & The Lodge Nursery Full occupancy 100% 100% Pinecroft and Cressingham – Respite Units Full occupancy 100% 100% North Street – Youth Offending Service Full occupancy 100% 100%

Caversham Children's Centre Full occupancy 100% 100%

D58

Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 1 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

1. Finance Accounts payable

• Processing of all expenses and payments (asprocessed by BFfC staff on Fusion or interfaced intoFusion from Mosaic) on behalf of BFFC and to be thefocal point of enquiries relating to the payment ofexpenses on behalf BFfC

Financial Systems

• Provision and maintenance of the four main financialsystems used by RBC and BFfC

• Provision of daily BACS files processing for APtransactions.

Accountancy & Transactions

• Accountancy Services will offer an efficient andeffective financial function to support BFfC to makeeffective strategic financial decisions, facilitated byproviding the following functions in a timely andaccurate manner:

• Budget Planning• Budget Monitoring and Budget Projections• Preparation of Statutory Financial Accounts

(Closure of Accounts)• Comprehensive Financial Advice and Guidance• Reconciliation of Brighter Futures for Children’s

Bank Account• Financial Assessments• Presentation of Financial Reports to Brighter

Futures for Children Board • Grant Claims

Account Payable

• Responsible for informing all Vendors of theFinancial Processes they must follow.

• Provide purchase order to vendors enablingpurchase order matches to vendor’s invoices

• Provide and maintain authorisation matrix forpurchase order authorisation and payment requestauthorisation

• Financial Systems• Ensure Financial Systems users are set up and

trained to use the systems• Ensure that users raise an order for supply within

either Fusion or Mosaic systems first beforecommissioning that service or goods from asupplier.

• Responsibility for Journal Approvers to ensure thatentries on behalf of BFfC are accurate, timely andhave working papers attached that clearly explainsthe purpose and means of calculation. Oncesatisfied, it is the responsibility of the Approver toapprove the Journal within Fusion.

• Any Financial Systems changes including, but notlimited to, hierarchy changes, mass user accesschanges, online payments functionality, bankingchanges, BFFC must notify the Fusion Board at least16 weeks in advance of any proposed go-live forminor projects, and at least 26 weeks in advancefor major projects

Accountancy & Transactions

• Provide clear information in a format, in a timelymanner to enable the appropriate delivery of

£342,522 Based on estimated staff

time & attributable

share of system costs

D59

Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 2 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

• Statutory Returns – including section 251 budgetand outturn returns

services particularly with regards to the statutory timetable for year-end closure of accounts.

• Prepare quarterly budget monitoring reports to theSection 251 Officer within Reading Borough Councilin a prescribed format.

• Approval of budgets, quarterly monitoring and finalstatement of accounts.

• Legally responsible for submitting correct returnsand for the payment of VAT on time.

2. Procurement • Support the management and monitoring of theprocurement and engagement of contractors bythe Company to deliver the overall Company aimswhilst also delivering financial savings.

• Support the development of best practiceprocurement and contract managementarrangements in the Company, working withCompany staff to review and continuouslyimprove practice.

• To maintain a programme of planned procurementactivity, to include re-letting of expiring contractsand the establishment of new contracts.

• Ensure the accuracy of the Third Party ContractsDatabase reviewing and updating at least quarterly

• At the earliest stage possible to provide fullinstruction on all Procurement, Contracting andTemporary and Interim Recruitment and projectmatters requiring support.

£31,932 Based on 100 days effort of staff time –

calculated on a daily rate basis

3. Audit andInvestigations

• Provides independent and objective evaluation of, andopinion on, the overall adequacy and effectiveness ofthe framework of governance, risk management andcontrol in.

• Identification of risks and assessment of theirmanagement, and implementation of changes tostrengthen the governance framework.

• Promote a secure and robust internal controlenvironment, which enables a focus on achieving thekey priorities.

• Investigation of reported allegations of fraud,corruption, irregularities and/or assist in internal

• Provide access to all information of whichmanagement is aware is relevant to the audit scopeor as requested by internal audit

• Proactively engage with the Audit team and meetthe agreed timelines and requests.

• Unrestricted access to persons within the Companywhom we determine it necessary to obtain auditevidence

• Ensure relevant staff are available during the periodof the audit

• Not to cancel meetings arranged during the auditperiod unless there are unavoidable circumstances

£30,668 Audit based on 68 days effort of

staff time – calculated on a daily rate basis

Corporate Investigations- estimated staff

time.

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 3 of 10 Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

investigations. and agreed with the Audit team. • Provide a response to the action plans. • To notify the Chief Auditor and/or Investigations

Manger of any instances of alleged fraud, corruption or irregularities and to seek immediate advice from them on the necessary steps to take.

4. Insurance • Arranging the Required Insurances for BFfC • Procuring other cover as instructed by the Company • Administration of claims made against the Required

Insurances, including making payments on behalf of the Company, from the self-retained risk funding held by the Council for this purpose’

• Competitive insurance and claims handling

• The Company must inform the Council’s Insurance Team within 5 working days of it becoming aware of personal injury, (to Customer, foster carer, member of staff, or visitor) that involves a hospital stay of three days or more.

• The Company shall make any and all disclosures to the Council’s Insurance Team necessary to comply with the duty of Fair Presentation under the Insurance Act 2015.

• The Company shall comply with all conditions and warranties contained within the required Insurances and other insurances placed on the Company’s behalf.

• The Company shall provide any and all information required to negotiate annual renewal of the Required Insurances and other insurances placed on the Company’s behalf.

• The Company will contribute to the excess/deductible ‘fund’ which is the funding to meet claims paid below the policy excess. Such contributions to be in accordance with the Council’s model applicable to services.

£15,972 Based on estimated share

of staff time (15%)

5. ICT • Telephony • Application Services • Infrastructure and Networks

• The Company will adhere to the Council ICT strategy whilst consuming ICT services from the Council unless this has been appropriately notified

£1,460,742 Based on estimated share of staff time

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 4 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

• Connectivity Services• Licencing• Asset managements• Incident, Change and Problem Management• Websites and web-based application• Data Security

to, discussed and agreed as allowable by the Council.

• The Company will review and contribute theirrequirements for any ICT contract which isprocured to ensure their requirements (outputs,performance levels, cost envelopes) are understoodand can be reflected in the resulting Councilcontract.

• The Company will consult with Council CICTS Teamespecially the business partnership roles on anynew systems to ensure Council ICT strategy andCouncil standards are followed.

• The Company will accommodate ICT PlannedMaintenance requests made by the Council and willhave appropriate disaster recovery and businesscontinuity arrangements in place to accommodateboth planned and unplanned ICT outages.

• The Company will ensure all ICT newstarters/leavers/changes requests are submitted toNPS on a timely basis so as to ensure Companyusers are set up as required and the Council is notexposed to unnecessary costs or security risks onstaff changing roles or leaving.

(25%) for Corp ICT and Web team, 50% share of mosaic and share ICT applications, hardware and software.

6. Health &Safety

• Enable BFfC discharge their responsibilities under theHealth & Safety at Work etc Act 1974

• 24 hours Strategic, Technical, Legal and OperationalHealth and Safety advice and support.

• Accident reporting and investigation, audits, trainingand policies management.

• Lone worker badge & Violent Incident System• H&S Policies management• H&S training courses, Induction Training

• Accident and incidents including near misses mustbe reported appropriately and investigated by theappropriate company manager within 3 workingdays. (The H&S team will provide support asnecessary.)

• The BFfC Board must ensure that theresponsibilities and arrangements contained in theCompany’s Health and Safety Policy are compliedwith at all times.

£18,000 Share of officer time <10% & licences and training costs

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 5 of 10 Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

• All projects or programmes undertaken by the BFfC which may have health and safety implications should be notified to the health and safety team in order that advice can be given.

• Advise the H&S Team of any high risk customers who may present a risk of violence or aggression to services in the Council.

• Appoint a Visit Co-ordinator and inform the Health and Safety Team of all off-site visits within adequate timescales.

• Advise the Health & Safety Team of any changes to the use of Lone Worker badges, of any badges that are reallocated to new users, of any lost/stolen/broken badges.

• Inform H&S Team of any chances and or additions to be included in the COSHH Database

• Inform H&S Team of any staff that require Logins H&S Systems.

• Inform H&S Team of any staff that no longer require Logins H&S Systems.

• Proactively update the Incheck – ‘Caution-before-contact’ – database

7. Legal & Democratic Services

Legal

• Primary function of LS is to provide a high quality, best value legal service which is timely, accurate, reliable and effective and responds to your instructions with professional skill, care and attention.

Data Protection

• Assist with the development and monitoring of the BFfC position in respect of its duties and

Legal

• Provide full instructions with supporting documentation/ information as requested and or necessary

Data Projection

• Ensure staff have complete/attend relevant training • Ensure relevant Privacy Notices are made available

to service users and complete DPIA’s when required

£227,997 Based on estimated FTE

effort

4.7 FTE

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 6 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

responsibilities under the Data Protection Act 2018 and codes of practice relating to the use of information, personal data and retention of records

Ombudsman

• Coordinating responses to complaints ofadministrative fault / maladministration made to theLocal Government & Social Care Ombudsman.Support the fulfilment of ‘Part III of the LocalGovernment Act 1974

Committee Admin

• Responsible for the management of the Council’sdecision-making process, primarily through managingand preparing meeting agendas, taking Minutes ofmeetings, and providing procedural advice toCouncillors, Council officers and Reading residents,including a number of Children and Education-relatedbodies.

• Comply with Subject Access Requests deadlinesReport any data incidents/breaches

• Register with the ICO

Ombudsman

• Providing a comprehensive explanation of thebackground to the complaint, answering allquestions and providing all information requestedby the Local Ombudsman

• Being proactively involved in the investigation andremedy required by LGO

Committee Admin

• Provide Lead Officer to liaise with over thearrangements for the specific committee meetingsbeing covered

8. Joint LegalTeam

The Joint Legal Team (JLT) will be responsible for providing legal advice to BFfC in respect of individual children’s cases and key operational issues for Children’s Services, In accordance with the RBC/JLT Agreement Arrangement. Including but not restricted to,

• Section 20 Process• Legal Planning Meeting Process• Care Planning meeting process• Care Processing Process• Adoption, Special Guardianship order and Revocation

of Placement order Process• Legal advices

• Provide clear instructions, confirmed in an email.• Any requests by the JLT will be provided on the

same day and in a co-ordinated manner, with clearlabelling of the documents attached.

• The JLT should be informed of any child who isaccommodated under Section 20 in order to giveadvice around the legal framework for that child.

£1,265,525 (TBC) Based on Joint Legal

contract charges and rates including

disbursements and hourly rate of £75 per hr

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 7 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

• Adoption• Revocation of Placement Order• Special Guardianship Order• Judicial Review Processing• Special Education Needs & Disability (SEND) appeals

process.9. Regulatory

Services• The Licencing Team act on intelligence from the

public and partners such as Thames Valley Police orBFfC related to CSE activity in licenced professionsand premises.

• CSE training for licence holders• Administrates Better Care Fund (BCF)

• BFfC only use licenced Taxi drivers that havecompleted CSE training in the past three years.

• Adhere to Disabled Facilities Grant Process.• Working in partnership support the Regulatory

Services team by providing Children’s safeguardingtraining to Staff

• Provide CSE training including Exploitation,Trafficking and refresher training to Regulatorystaff

£0 Foster care adaptations capital works funded by DFG grants. Service cost limited to advice and guidance by team and deemed to be negligible.

10. EmergencyPlanning

• Provide a suite of emergency plans, templateemergency plans, guidance, training and an annualemergency exercise.

• Provide template business continuity plans, guidanceand training for the Company, and an assuranceservice to verify the quality of its Business Continuityplans

• Provide template risk registers, guidance and trainingfor the Company.

• Provide 6 monthly reports to the company containingcombined performance data on Emergency Planning,Business Continuity and Risk Management.

• Emergency Response - Provide fully trained on callBRONZE and SILVER Officers to respond to genericemergencies and act as the Councils and Companies

• Identify posts at GOLD, SILVER and BRONZE levelthat require Emergency Planning/BusinessContinuity training

• Provide staff to attend the Council’s EmergencyOperations Centre when an Incident/MajorIncident/Emergency occurs and the annualemergency exercise

• Provide and to maintain a list of Out of Hourscontact details for schools on a quarterly basis

• Provide annually a list of staff to be added to amailing list to receive severe weather and floodwarnings

• Follow the Business Continuity guidance providedby the RBC.

• Prepare Business Continuity Plans for its services.

£27,427 Based on standard on call staff costs, hardware and officer time @20% of staff time.

D65

Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 8 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

representative at the scene of an emergency/major incident

• Provide a list of the BFfC priority service areas sothat Business Continuity Planning efforts/reviewscan be targeted/prioritised.

• Responsible for completing its own risk register(s).

11. Transport • Service provider for all fleet assets• Fleet Services Management,• Manage all fleet vehicles and equipment from “cradle

to grave” • Manage and maintain the Driver licence checks and

monitoring system

• Actively support maintenance initiatives• Ensure vehicle and equipment are available• for preventive maintenance activities• Provide accurate data to Fleet Management

regarding vehicle and driver allocations and newstarters / leavers

• Report all accident and work-related damage• Provide fleet driver licences• Maintain Staff list to have access to Driver licence

checks and monitoring system

£50,688 Based on the operational unit running costs of 7 vehicles (includes vehicle maintenance, insurance, running costs etc.) and <10% of staff time.

12. CustomerServices

Customer Service - An inbound call centre operated by Customer Services to administer incoming information enquiries from customers. Providing advice and assistance service by phone, email, website and social media platforms. First point of contact for School Admissions Family Information Service/ SEND Local Offer - Provide the statutory requirement to provide a range of information (prescribed by regulations) which parent carer may need to support their children through to their 19th birthday up to 25th birthday for young people with SEND. Interpretation & Translation Services - Face to face, telephone and British Sign Language Interpretations and the translation of documents as required.

• Proactively support the development andmaintenance for FIS and SEND Local Offer webcontent and or expanding existing sections toinclude new information.

• Work in partnership with FIS to ensure the FIS /SEND Local Offer service meets the needs ofReading families.

•

£191,128 Based on full cost of FIS team – 3 FTE andattributableshare of callcentre @ 3.1 FTE

13. HumanResources(Subject to confirmation)

HR administration and job evaluation - The HR Administration service covers all aspects of the employment lifecycle, from the advertisement of and recruitment to job vacancies, the administration of

HR administration and job evaluation

• Provide clear instructions and information to RBCHR Team to enable appropriate delivery of services

• Promote and fully utilise iTrent Employee and

£260,442 Share of attributable staff time ~5 FTE and training and

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 9 of 10 Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

contracts of employments and variations thereof, the administration of employee benefit schemes and local agreements, to the termination of employment. A comprehensive service ensuring that all BFFC jobs are consistently evaluated in line with the Reading Borough Council’s Single Status Policy, thus protecting BFFC and the Council against equal pay claims. Workforce Development - Working with BFfC, analysing the workforce, and extending that analysis to identify the future skills and competencies needed to deliver new and improved services. The comparison between the present workforce and the desired future workforce will highlight shortages, surpluses and competency gaps, whether due to external pressure or internal factors. These gaps will become the focus of a detailed workforce plan, identifying and implementing strategies that will build the relevant skills and capacity needed for organisational success. Workforce Development Team will source the Training/Learning for the directorates within the constraints of the budget and resources allocated. (Subject to confirmation) Payroll & Pensions Services - Provides a fully comprehensive payroll and pensions administration service, ensuring staff are paid correctly and on time whilst meeting all statutory and contractual obligations Nursery Crèche - Provides Operational childcare spaces within Kennet Day Nursery day care service.

Manager Self Service functionality for all employees within BFFC

• Utilise the forms provided by RBC to notify RBC HR Team of establishment changes relating to BFFC posts.

Workforce Development

• Inform of Staff, Starters, Leavers and Movers to enable

• Senior managers to take lead for learning and development activity

• Provide scope and requirements for new and bespoke digital learning solutions.

Payroll & Pensions Services

• Provide accurate and timely information to RBC Payroll Team in respect of changes to employment and personal circumstances that may affect an employee’s pay, contract or pension using forms provided for that purpose

Nursery Crèche • The Operational Crèche Placement Form must be

completed as soon as possible and before a child will be allowed to have care at the setting in order to obtain all the necessary information needed for the child’s welfare.

• BFFC will inform Kennet Day Nursery of any identified children that need to be taken care of as part of the operational Crèche as soon as possible

• Less than 5 working days’ notice will be deemed as an Unplanned Placement.

system costs ~£160k

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Appendix F

Reading Borough Council Children’s Services Transition Project

Service Level Agreement - summary table

Page 10 of 10Subject to confirmation following final negotiations

SLA Name Brief Description of activities Brief description of Company Dependences Final value of the SLA

Methodology

14. ChangeManagement

Provide Business Change Management and Business Analysis; Business Change - Providing advice, guidance support and delivery management on change (Project & Programme Management) Business Analysis - Providing advice, guidance support on how to deliver effective business analysis and analyst resource Business Change Training & Deployment - Providing a suite of Business Change focused training and development opportunities.

• The Business Change Team are the first port of callfor any Business Analysis and Change Resource.

• BFfC will communicate their Business Analysis andChange requirements as part of annual reviewswith the RBC

• BFfC should expect to work within Prince2 Projectand MSP Programme Management framework,

£42,764

Based on 200 days of Business change expertise

15. RecordsManagement

RBC maintains a non-current records store at the Records Management Unit (RMU), Providing a secure storage and curatorial oversight for these records as well as an enquiry and retrieval service for items from them.

• Ensures that nothing hazardous or presenting ahealth and safety risk is contained within anyrecords transfer. This will include maintenance ofa safe lifting weight for each box.

• Responsible for ensuring that adequate listing anddocumentation of metadata is provided at thetime of transfer of the record.

• BFfC will be responsible for providing an up-to-date list of personnel able to access non-currentrecords with details of which transfers they arepermitted to access.

• Responsible for ensuring that new items are notplaced on closed files or that new destructiondates are communicated to the RMU.

£27,000

Archiving service based on fully

loaded cost of £9 per box based on

3000 boxes

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