Decision Maker:

Outcome: For Determination

Is Key Decision?: Yes

Is Callable In?: Yes

Date of Decision: April 7, 2025

Purpose:

Content: RESOLVED:   1.  To agree a Contract Variation of £2.5m excluding VAT for the Hackney and City Integrated Drug and Alcohol Service (existing value £29m) covering financial year 2025/26 - this grant funding has been confirmed, and will be awarded upon approval of this report. 2.  To agree a delegation of authority to the Director of Public Health to award 2026/27 funding up to the value of £2.5m for financial year 2026/27, pending confirmation of grant funding by central government. The revised maximum potential contract value including variation will be £34m.     Reason(s) For Decision   Background and details of the proposed variation This report is presented to the Cabinet Procurement and Insourcing Committee to approve a contract variation of £5,000,000 for the delivery of community drug and alcohol treatment, covering a potential £2.5million additional spend with the core treatment service in each of the financial years 2025/26 and 2026/27.   Since 2021 LBH has received grant funding from Central Government to help reduce harms related to drug and alcohol use.   This funding has been used to deliver new pieces of work, including commissioning bespoke services, as well as to help enhance the core treatment service currently delivered by Turning Point.   The funding has delivered strong outcomes in areas such as the number of people in treatment, and the proportion of people leaving prison continuing to receive support uninterrupted.   In December 2024 LBH were informed that there would be at least a one year continuation of grant funding to continue enhanced delivery. We have also been advised that a multi-year determination is to be made in March 2025, which will likely cover another two financial years.   In July 2023 CPIC approved a contract variation with Turning Point allowing them to deliver additional services with grant funding. This variation expired on March 31st 2025.   In December 2024 a contract extension of 18 months was agreed with Turning Point, bringing the current contract’s end date to March 31st 2027.   Therefore, in order to continue providing  these additional services until the end of the contract, a further contract variation is required. This variation allows for additional spend in 2025/26, with the potential for continuation in 2026/27.    In mid 2025 we will commence a programme to review current provision and undertake design work to  ensure a sufficient amount of time for full re-procurement and mobilisation.   Overview of Available Grant Funding for Reducing Drug and Alcohol Harms 2025/26 to 2027/28   The Supplementary Substance Misuse, Treatment and Recovery Grant (SSMTR) was initially given to LBH in FY 2023/24 following two successful years of enhanced funding primarily focussed on drug use and the criminal justice sector (project ADDER).   SSMTR further increased the scope of earlier funding streams to aid increases in treatment and support for drug and alcohol users, as well as to help improve outcomes.   The intention of the funding was to support Central Government in achieving the aims of the 2021 national drug strategy.   SSMTR was continued in 2024/25, increasing the funding given in 2023/24. There were no further announcements regarding continuation beyond 2024/25 until November 2024, following the general election and change in ministerial oversight of the funding and strategy.   In November 2024 the Office of Health Improvement and Disparities (OHID) wrote to LBH to inform them of a Department of Health and Social Care (DHSC) decision to retain the National SSMTR envelope following the announcement of the national budget in late October.   The Rough Sleeping Drug and Alcohol Grant (RSDATG) has been received by LBH since 2021. Its intention is to help support individuals facing homelessness get better access to substance use services.   In November 2024 LBH was informed that RSDATG would be integrated into the SSMTR grant for 2025/26 and beyond, with a reduction in the overall RSDATG envelope.   On 18th December 2024 LBH were informed that the total overall grant envelope for 2025/26 would be £4,099,161. The grant would consolidate SSMTR and RSDATG into a single grant - the Drug and Alcohol Treatment Grant (DATRIG). This total is slightly less than 2024/25.   Grant response and continuation of core service expansion   In response to the confirmation of grant continuation, the City and HackneyPublic Health Team engaged with the Combating Drugs Partnership (CDP) through working groups, the strategy group and individual partner meetings to set priorities and develop a spending plan. Our plans for 2025/26 focus on continuing initiatives that were effective, and reallocating resources from areas that were less impactful.  The majority of previously delivered initiatives are to be continued, including: ·  Increase in Local Authority staff focussed on substance use ·  Use of small, local, organisations to help provide cultural competency to service delivery ·  Increased capacity in core treatment service, including both staff and pharmacological capacity. Funding will be released by reducing or discontinuing spend in the following areas: ·  Restructuring employability services for people who use drugs ·  Not filling a vacant post in the Public Health substance use team ·  Reallocating resources from a rough sleeping outreach team focused on mental health, where outputs were suboptimal, towards improved integration of mental health support across the system   Overview of additional funding for core service   Appendix 3 shows the planned additional items funded for the core treatment service in 2025/26 and potentially 2026/27.   The plan in Appendix 3 accommodates a continuation of many workstreams and resources to establish some new interventions.   The spending plan has been provisionally agreed by OHID as part of the submission process to receive the funding. Once confirmed, spend will be monitored routinely by OHID. A recent audit of our internal governance indicated that the monitoring systems are sound (Appendix 4).   A significant contingency allocation will allow us to respond to new risks or opportunities without needing to draw on the core public health budget should the need arise. This will be reviewed throughout the year in partnership with OHID to ensure that there is no underspend by the end of each financial year.   Project Progress   ·  Developments since the Business Case approval ·  Grant funding has been unpredictable for a number of years. ·  LBH was only informed of grant funding for 2025/26 on 18/12/2024. At time of writing this has still not been ministerially confirmed. ·  In order to ensure that we can deliver services to vulnerable residents using this funding we need to vary the current contract for our core treatment provider. ·  An option within the contract to extend the existing arrangements for Turning Point’s  core services was taken  to extend till March 2027. ·  As there is an indication that there will be further funding in 2026/27, it is necessary to preemptively vary the contract for additional services in order to continue delivery into the final financial year of the current service contract. These services will only be delivered in 26/27 if grant funding is confirmed.   Alternative Options Considered and Rejected   The table below lists the alternative options to the suggested contract variation:   Alternative Options Risks Reasons for Rejecting Complete a full procurement process for the grant funded elements of delivery The procurement process would take a minimum of 6 months, with a likely further 6 months period for a new provider to begin delivery. In addition there would be duplications of cost due to the need for new management structures, as well as risks to patients due to multiple providers delivering on separate systems.   Time required does not match timeframe for delivery against aims of grant.   Risks to patients.   Cost duplications Insourcing Insourcing would not be possible due to the complexity of delivering the adult treatment service. Clinical structures would need to be created, new management systems would need to be formed and different data systems would need to be procured. This is not possible within this timeframe.   LBH does not have the systems in place to deliver complex medical services. Costs and timeframes to develop these would result in non-delivery of service. Additionally the challenges arising from two providers would increase patient risk. Do nothing, and do not accept the grant funding National drug related deaths continue to increase, particularly due to the increasing presence of synthetic opioids such as nitazines and fentanyl. The treatment service is underfunded in relation to these increasing risks should it utilise public health grant funding alone, both due to previous cuts to service and the increased costs for staffing and pharmacological delivery. To not invest further with additional grant funding is likely to result in an inability to respond to increasing risks and drug related deaths. Significant likelihood of inability to respond effectively to increases in drug related deaths and harms related to drug use.