New report shares NHS GM response to VCFSE sector instability

This comes following the GM VCFSE Leadership Group’s letter to Greater Manchester commissioners on the sustainability and vulnerability of the voluntary, community, faith and social enterprise (VCFSE) sector at a time of significant instability following years of systemic issues, underfunding, disinvestment, delayed commissioning decisions, and new financial pressures.

The report, shaped by conversations at the GM VCFSE Leadership Group’s Commissioning and Investment sub-group, provides an update on the ongoing challenges faced by the VCFSE sector and proposes how those challenges can be mitigated by a strong forward strategy and clear commissioning principles.

Strategic response

The report proposes a strategic response to the instability facing the sector. The key actions proposed, some of which are now underway, include:

• ‍Letters of Intent: Issued to VCFSE providers (except where services are confirmed to end), offering up to 12 months of assurance to help retain staff and maintain operations.

• Service Reviews – future intentions: All VCFSE-commissioned services will undergo a full review in the first half of 2025/26. Outcomes will be presented by mid-September 2025, allowing for timely decisions and 6-month notices.

• Multi-Year Contracts: Where services are effective and aligned with strategic goals, NHS GM proposes moving to multi-year contracts to reduce uncertainty.

• Market Development Strategy: This recommendation was made in our letter on VCFSE sector instability. It is proposed that a VCFSE Market Development Strategy be developed alongside the VCFSE sector, aligned to the GM sustainability plan, 10-year health plan for England, GM Live Well and the GM Strategy, to support a thriving VCFSE sector, and introduce and encourage new providers where gaps exist.

• Risk Recognition: The fragility of the VCFSE sector is acknowledged as a strategic risk. NHS GM proposes adding this to its risk register, with mitigation actions assigned at both GM and locality levels.

During the meeting in July, the ICB recognised the risk to our sector and have accepted the proposals made. Warren Heppolette, Chief Officer for Strategy, Innovation & Population Health at NHS GM, is overseeing delivery of the identified actions.

NHS GM Commissioning principles

The report outlines NHS GM’s renewed commitment to the VCFSE sector through a set of commissioning and contracting principles that look to align with the GMCA and VCFSE Fair Funding Protocol. These principles aim to address the financial and operational instability affecting the sector and to reinforce its role as a strategic partner.

The principles are built around practical changes and areas of work. These include ensuring the sustainability and stability of the sector, promoting parity and equality with other providers, increasing transparency in decision-making, and involving the VCFSE sector meaningfully in commissioning processes. NHS GM pledges to offer longer-term contracts, fairer funding practices, and clearer communication, while also recognising the unique role and contribution of VCFSE organisations.

This framework marks a significant step toward a more equitable, collaborative and resilient partnership between NHS GM and the VCFSE sector, especially during a time of financial challenge and sector fragility.

Commissioning for inclusion

Within the Commissioning Principles is an approach originally approved in 2020 by partners to better serve vulnerable and marginalised groups. It emphasises that the effectiveness of public services should be measured by how well they identify and meet the needs of people with complex requirements or those at risk of exclusion. The model relies on fully utilising all parts of the service delivery system, particularly the VCFSE sector, which plays a vital role in reaching these communities.

Although this programme was included in the VCFSE Accord Delivery Plan, its progress has stalled. However, in the report, NHS GM proposes to reinvigorate this approach under the newly adopted commissioning principles. Most of the work will be carried out at a neighbourhood level with some activities taking place at a GM-level, especially in developing specialist service and working with communities whose needs don’t fit traditional service models.

Overall, the report sets out a direction of travel for NHS GM’s and the GMCA’s collaboration with the sector, recognising the crucial role the VCFSE sector plays and the challenges it faces. The proposed forward strategy for their work with the VCFSE sector builds on the strength and maturity of the work of the last five years of the GM VCFSE Accord, delivering an even greater cultural shift towards true collaboration and partnership.