
The Academies Financial Handbook is updated annually by the Department for Education and the Education and Skills Funding Agency; it contains a number of governance requirements for academy trusts.
The Care Act 2014 (the Act) is the single most important piece of law effecting social care in over 60 years and much of the Act, as well as related regulations, will come into force on 1 April 2015. It will have a significant impact on the sector; in very broad terms it:
The New Regulatory Regime
A key focus for charitable care providers will be the new regulatory framework which is being introduced alongside the Act. The changes will apply to all registered providers of adult social care from 1 April 2015, will be administered by the Care Quality Commission (CQC) and include:
These statutory duties will be implemented in conjunction with the new, tougher CQC inspection regime (based on Key Lines of Enquiry) and rating system (outstanding, good, requires improvement and inadequate). Charities providing care will need to act quickly to ensure their current systems stand up to scrutiny in light of these extensive regulatory reforms. Trustees are likely to be quick to note that some breaches of the fundamental standards are criminal offences and the risk of prosecution is significantly higher than under the previous regulatory regime.
With so much change on the agenda, it is a daunting time to be a trustee of a social care charity. As charities wrestle with the opportunities and challenges presented by the Care Act they will want to be sure the CQC would consider them “well led”. With regular media stories highlighting examples of poor quality care, trustees are increasingly seeking assurance that their organisation is not going to be the next big story and that they are playing an appropriate role in ensuring the delivery of high quality care. The finance team will also have an eye to the impact of the charity’s CQC rating on occupancy rates and the knock-on effect on the charity’s financial health.
So what should the board be doing?
Care providers vary significantly in their approach to involving boards in setting up systems to ensure the delivery of high quality care. Surprisingly, the quality of the service is rarely a routine element of board meetings with the scrutiny of the operational team often getting much less time than finance or business development. In our experience the following issues are likely to require consideration in any routine review of quality:
Charitable care providers should also ensure that the board of trustees are aware of the new regulatory approach taken by the Charity Commission, as well as the new CQC regime. The willingness of the Charity Commission to ‘show its teeth’ as a regulator has been demonstrated by the number of recent statutory inquiries it has opened. The Chief Executive of the Commission Paula Sussex recently said “the Charity Commission will be quicker to use its regulatory powers and less likely to allow charities the benefit of the doubt…” Even where other regulators are involved, the Commission has shown a willingness to get involved to assess whether the charity trustees fulfilled their duties. It has, for example, recently opened an inquiry into St Paul’s School to ‘investigate the charity trustees’ approach to safeguarding and handling of allegations of a sexual nature’.
The impact of a new CQC enforcement regime is already being felt and the pressure to be seen by CQC to be performing well is only going to increase.
Care providing charities continue to adapt to the changing environment by developing new skills and services, exploring commercial partnerships and engaging more closely with service commissioners. As they do so, their activities become more varied and often more complex. It is essential that standards of governance keep pace.
This article first appeared in the Charity Finance Yearbook 2015.
Contact Shivaji Shiva
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