Governance and relationships

Published 24 February 2017

Governance for a successful STP

Sustainability and Transformation Partnerships (STPs) were always likely to attract significant attention and even controversy; designed as they are to look afresh at service provision, organisational structures and partnerships within each area. Many STPs mention organisational mergers or partnership working, enabled in some cases by shared leadership arrangements. Most STPs highlight the need for significant changes to services (including in some cases the ever-emotive accident and emergency and maternity services).

STPs have potential to achieve significant positive change for health and social care provision, but in the context described here, it will be essential to ensure that their continued development and their delivery is governed appropriately. It is not over-stating the position to say that good governance could be the difference between success and failure if there are legal challenges to STPs’ intentions for changes. 

What does ‘good governance’ mean for an STP?  What practical steps need to be taken?

STPs will be delivered by NHS organisations, local authorities and other organisations working in partnership. But those organisations remain sovereign (unless and until any mergers take effect where that is planned) and must comply with their own governance arrangements, and the legal and regulatory obligations that apply to them. The organisations’ boards, councils of governors, and governing bodies (or equivalent) must take and be seen to take the key decisions necessary for their organisations in respect of changes to services and organisational structures. Those decisions may be taken in meetings within organisations, or they may be delegated to individuals who are members of an STP governance forum (this is often confusingly labelled as the “STP Board”).

Whatever the arrangement, clarity is essential. To ensure compliance and to minimise the risk of challenges, the participant organisations in an STP footprint will need to identify the decisions that are required and determine which body, or individual, should take them.

How can we integrate decision making in an STP footprint?

• Clearly set out the scope, aims and objectives of the STP governance forum.
• Governance arrangements should be clearly defined and communicated to all concerned.
• STP governance arrangements must dovetail with those governance arrangements of organisations that have members attending the STP governance forum.
• Ensure that the governance arrangements are understood by all concerned rather than simply being written down.
• Those in senior roles must also have knowledge of the statutory duties that apply to them and their organisations. This applies in particular to foundation trust directors as well as others too. For example, each foundation trust director has a statutory duty in respect of avoiding conflicts of interests – this is likely to present some challenges in partnership working but especially within any shared leadership arrangements.

If the members of an STP misunderstand the authority which they have in a particular area of decision making they may either fail to take a decision for which they have authority (leading to delay and inefficiency), or they may exceed their authority (increasing the likelihood of success in a public law challenge).

Whilst governance arrangements may be well-defined and the decision making process itself may be clear, it is important that it forms part of a wider plan for the changes which STPs will introduce. Both commissioners and providers have legal obligations in respect of consultation with stakeholders.  If the risk of legal challenge is to be minimised, timing is crucial in respect of consultation, but the same is true for decision-making.  A decision taken at the wrong time can render, or appear to render, consultation ineffective. For foundation trusts that is likely to include engagement with governors, ahead of formal decisions being taken where their approval is required (and even where it is not).

In an STP footprint participant organisations have a complex set of governance arrangements to navigate, as well as regulatory scrutiny of their plans from NHS England and NHS Improvement. Such scrutiny will be applied to the STPs themselves but potentially also to specific changes set out within them (and therefore to participant organisations). For example, a material redesign of a pathway which leads to income changes for a provider, or to changes in ownership of assets. The Integrated Support and Assurance Process guidance has now been published, therefore, providers and commissioners will need to include regulatory scrutiny in their plans to implement STPs, particularly when “complex contracts” are being procured.

STPs are designed to address strategic risk (in respect of financial and clinical sustainability) but they also generate it as we highlight here. STPs should, therefore, identify and manage those risks – a collective approach will be required but it will need to be integrated with participant organisations’ own risk management arrangements. Such an approach, combined with the clarity and careful planning we highlight above, will help STP footprints to manage the risks they face.