Decision details

Contract Novation in reference to Peterborough City Council Integrated Drug and Alcohol Treatment Service Contract – DEC18/CMDN/70

Decision Maker: Leader of the Council and Deputy Mayor of the Cambridgeshire and Peterborough Combined Authority

Decision status: Recommendations Approved

Is Key decision?: Yes

Is subject to call in?: Yes


The Cabinet Member approved the contract novation of Peterborough City Council's Integrated Drug and Alcohol Treatment Service contract from the charity Change Grow Live to the wholly owned subsidiary of the charity, Change Grow Live Services Limited.


Reasons for the decision:

The Public Health Grant has seen a cash reduction in Peterborough for the past three to four years. This has necessitated savings being made in the commissioned specialist treatment service.


The Integrated Drug and Alcohol Treatment Service, due to the downward trajectory resource envelope, has limited resilience against unprecedented cost pressures. The financial pressure is particularly acute in Peterborough where the Public Health Grant benchmarks very poorly against its comparator areas.


Factors detailed within this report have contributed to severe pressure being placed on service delivery, therefore the novation shall alleviate these financial pressures and ensure continued delivery of service outcomes. The corporate restructure shall allow the provider to whom the agreement is novated to charge VAT on the contract, which shall be recoverable by the Council, and allow the reclaim of VAT charged by the provider’s suppliers.


Through the ability to reclaim VAT monies the service provider shall be able to focus spend on areas that shall improve and maximise service delivery and ensure it continues to deliver effective service outcomes


Alternative options considered:

Not to novate the agreement.  An innovative solution is required in order to alleviate financial pressures and reduce the severe pressure being placed on service delivery largely due to external factors which include mitigation against recent drug cost pressures.  Therefore, not novating the agreement would have an impact on the delivery of service outcomes, savings will not be delivered and other efficiency savings may need to be identified.


Interests and Nature of Interests Declared:


Background Documents:


Publication date: 19/12/2018

Date of decision: 19/12/2018

Effective from: 03/01/2019

Accompanying Documents: