Your Choice Barnet (YCB) “The real deal”
Your Choice Barnet (YCB) “The real deal”
YCB imposed a 9.5% cut in pay to all their staff starting from 1 April 2014. Barnet UNISON carried out an indicative ballot to ascertain if members wanted to accept the 9.5% cut or if they wanted to be formally balloted. UNISON members overwhelming voted to be balloted for strike action.
UNISON organised a legal strike ballot and members voted 100% for strike action this was an amazing result.
ACAS became involved and UNISON agreed to attend a meeting together with ACAS and YCB. At this meeting an agreement was reached that staff would have their pay reinstated for just one month, whilst further negotiations took place.
These further discussions elicited more financial information in an attempt to ascertain the financial viability of YCB and to see if savings could be made from ‘expenditure/overheads’.
We asked them to look at savings across the following headings:
· Senior management costs
· Financial services
· Accommodation costs
· IT services
· Business Improvement costs
· Renegotiate the terms of the £1 million loan from Barnet Homes
YCB then made a revised offer of a 8.31% pay cut for our members, further reductions were offered if staff wanted to lose some of their annual leave. Our members were given a detailed chart showing the further reductions of the 9.5% depending on how much annual leave they lost.
On a 73% turnout 90% voted in favour of taking action to reinstate their pay. Actually more members took part in this third ballot in three months and more voted for strike action.
Key ongoing issues throughout the negotiations so far
· Was YCB able to generate enough new income to reduce the need for cuts to staff?
·Was YCB able to generate enough new income to pay off the £1million loan to Barnet Homes?
·Over the last 18 months there has been a 30% reduction in staff as staff have been made redundant in order to save money for YCB.
· Staff working in Supported Living & Valley Way have had their ‘out-of-hours’ payments slashed in order to save money for YCB
· YCB have increased the numbers of assistant support workers and reduced the numbers of support workers in order to save money for YCB
· YCB is wholly owned subsidiary of The Barnet Group which is wholly owned London Borough of Barnet, YCB had to take a loan of £1 million from Barnet Homes (another company which is wholly owned by the London Borough of Barnet through The Barnet Group)
· YCB said they had not been made aware of the cash flow problems as a result of moving from block contract payments.
· YCB were not resourced for the level of invoicing necessary when the payment moved from block payments.
· YCB were unprepared to cope with no payments for ‘no shows’.
“What is a ‘no show?”
This is where the service user does not attend a service, this could be for planned reasons such as holidays or hospital appointments or through sickness. It is has been shocking to hear that the impact of this critical factor had not been identified as a serious risk to the financial viability of YCB. We have learnt that although discussions have been had with LBB over ‘no shows’ the financial losses are a significant factor in the future viability of YCB. We estimate about 50% of the 9.5 % cut to our members is as a result of the financial penalty imposed by Barnet Council on YCB.
· It has become clear over the last 18 months that the financial viability of YCB rests solely with Barnet Council.
· Barnet Council is penalising YCB by not paying for ‘no shows’
· Barnet Council is hardly making new referrals to YCB
· Barnet Council is not paying YCB the going rate for the service provided “Prior to the salary reductions changes we were being paid a market rate of £18.43 per hour and it was costing us £21.81 per hour and this was not sustainable” (source: Hendon Times 3 June 2014)
· In response to the cuts to our members there has been some commentary (inside YCB and in the public domain) that if only YCB could grow new business the profits would negate the need to make pay cuts to the staff.
· Barnet UNISON decided it was critical to our negotiations that we look into the possibility of generating new income in order to see if this was an area which if successful would enable the cuts to be withdrawn or reduced. In our negotiations with YCB we asked for details for each service in order to see if they could deliver new business and if so what any new income would mean to staff in terms of their 9.5% pay cut.
· For Supported Living we learnt that any new business would not deliver a financial benefit to the business so no point in looking to grow this service.
· The two of the three day services are intensive support for service users so even some marginal increases in numbers of service users mean that there is not enough marginal profit to generate meaningful income either to mitigate the cuts to our members pay or support the future viability of YCB.
· Barnet UNISON felt there was too much money spent on back office services for an organisation which employees only 105 fte staff. YCB responded by offering a marginal 1.19 % saving from their ‘expenditure/overheads’which meant the 9.5% cut would reduce to an 8.31% cut for our members.
· Because our members rejected the revised offer YCB have said they will not make the identified 1.19 % back office saving.
· Our members reported ongoing threats that they should “forget about returning to Barnet Council and be more worried about being privatised” needless to say this did not go down well with members!
· YCB were unable to give any assurances to staff that if they accepted the 8.31% cut this year, YCB would not come back for further staff savings next year.
· YCB were unable to explain how they were going to find the money to make the first repayment due in 2014/15 of the £1million loan over three years to Barnet Homes.
It was clear that the only way for YCB to be financially viable would be if:
· Barnet Homes writes off the £1 million loan.
· Barnet Council stop penalising YCB for ‘no shows’.
· Barnet Council pays up front to YCB in order to help the cash flow situation
· Barnet Council pays the going rate for the services being offered.
· Barnet Council conducts an immediate investigation as to why Adult Social care services have referred only a handful of referrals in the last 2 and half years.
· Senior management and other Service Level Agreement costs imposed on YCB are reduced.
· YCB & Barnet Council find a more efficient way to invoice for services. The current arrangement is that Barnet Group invoice Barnet Council then YCB invoice Barnet Group.
· YCB is allowed to independently procure its own support services and not be forced to use Capita CSG services.