"The company that puts in the lowest tender to the council usually – not always – gets the contract. What's new is if it's being applied to individual care packages. The councils are strapped for cash by the Government and the companies see the chance for profit. The old are squeezed between. A scandal all round,"
Here is hypothetical 'Jim', seventy five years old, in need of a 'care package' to be provided by Birmingham City Council which is using SProc.Net and is well pleased by this since it has reduced its spending on care for old men like Jim by almost a fifth since using this system. So Jim's care is put out to auction. Sometimes the bidding is time-limited to a few hours. In Jim's case it lasts for two days. Providers put in their bids and the software produced a shortlist of the most 'favourable'.
The shortlisted bidders were then told where they are ranked in the process and the one in second place, adjusted their bid, by lowering their price for Jim and so moved up to first place and bought the right to provide his 'care'.
Birmingham and Southend Councils have adopted the system and a handful of other councils are due to start using it soon. Adrian Baldwin, Matrix SCM's Marketing Manager, said the company was in talks with 30 other councils about the system.
"Councils specify their requirements and then broadcast them to market. At the end of the process they can get post-transactional feedback. It's a bit like the eBay community."
However, when Adrian was asked 'whether the system amounted to an 'auctionyourgranny.com' situation' ?' he laughed and said the process was actually a kind of reverse auction that was about driving prices down rather than up :
"Providing care is so emotional and people get nervous about it costing less. Changing that behaviour requires a different mindset. We are taking that logic to a market that has perhaps been too soft, too fluffy and not challenged. Economic austerity and legislation have driven the need to think differently."
In addition, although a spokesman from Birmingham Council said the system had led to savings of 18% and has a projection to save £3.2m in care costs this financial year, he stressed that cost was not the only consideration and that the council had rejected some bids on the basis that it was not possible to deliver a safe service for the very low price some providers offered : "The system is designed on the basis of a scoring matrix which ranks quality at 60% and pricing at 40%." Having said that, surprise, surprise, 92.23% of bids under the auction system were awarded to the supplier offering the cheapest price.
Les Latchman, Chair of the Birmingham Care Consortium, said:
"I believe this system increases the risk to people who are being looked after. They are treated like cattle. Care is bought in the same way that people buy toilet paper. The system works well when it comes to saving money but fails miserably when it comes to providing quality and safe services."
John Lister, of the campaign group Health Emergency, condemned the system :
"Local authority care budgets have already been slashed to the bone, there's nothing left to cut. This system is auctionyourgranny.com, it's a race to the bottom."
Old men and women all over England and Wales in need of council provided care by a local council outside Southend of Birmingham and in one of the thirty, 'in talks' with Matrix SCM take note. You too could soon be up for auction and beyond that all old men seeking care should take note, that Francis Maude, Government Cabinet Office Minister, visited Matrix' SCM's premises this year and in a video on the Company's website he said : "This is of serious interest."
A post last year :