Constructing the options
4.13 When constructing the long-list, options should not be fully specified as an end-to-end solution immediately. Instead, they should be built up by considering the choices summarised in Box 5.
Box 5. Choices in the Strategic Options Framework Filter
| Option choices - broad description | ||
| 1 Scope |
| coverage of the service to be delivered |
| 2 Solution |
| how this may be done |
| 3 Delivery |
| who is best placed to do this |
|
| when and in what form can it be implemented | |
| 5 Funding |
| what this will cost and how it shall be paid for |
4.14 Consideration of these choices should include:
scope - what is to be delivered and where, including geographical coverage, recipient population, service quality, time limits and any other relevant factors
solution - how the outcome is to be delivered, considering available technologies and best practice, and including:
O the creation of new markets
O the introduction of new or revised regulatory arrangements
O use of "nudge techniques" based on insights from behavioural psychology and economics
O grants and subsidies
O public information initiatives
O new or changed service provision
delivery - which organisation(s) is best placed to deliver, for example:
O direct public sector provision
O Public Private Partnerships (PPP)
O not-for-profit private providers
O private sector providers
implementation - how the proposal is to be delivered, for example:
O will it be an initial pilot, phased implementation or a 'big bang' approach?
O is it a roll out dependent on geography, age, expiry of existing arrangements or other factors?
O should a range of options for roll-out be considered and tested?
funding - what is an indicative cost and how will it be funded. This may interact with the delivery option
4.15 Individual and society's wellbeing is influenced by a number of interrelated factors including health, relationships, security and purpose. At the long-list appraisal stage, evidence on the determinants of wellbeing can help describe Business As Usual and the purpose or scope of an intervention through SMART objectives. It may help to identify interventions which have an impact on wellbeing or another outcome which is affected by wellbeing. This supports the development of a long-list of options or the most efficient way of implementing a proposed solution.
4.16 Where appropriate evaluations of previous or similar interventions, international and wellbeing evidence, should be used to design options that build on what works, to avoid repeating past mistakes. Box 6 provides an example of the use of evaluation evidence and piloting. This is particularly important when considering the scope of a proposal and the service solution (the technical means of delivering the intervention). When assessing the relevance of previous evaluation, allowance should be made for differences in context, circumstances and culture.
Box 6. Use of Evaluation and Testing
| The Behavioural Research Centre for Adult Skills and Knowledge wanted to understand if behavioural science could help improve educational outcomes for 16 to 19 year olds. Existing research suggested that there is a link between strong social support and student attainment. The project team adopted a 'test, learn, adapt' methodology, which focuses on testing what works and continually improving policy interventions in response to evaluation results. Almost 1,500 students at 9 further education colleges were enrolled into a 'study supporter' trial. Students were randomly assigned into 2 different groups. An intervention group is asked to nominate one or two 'study supporters' (such as a parent, friend, or employer) to receive weekly text messages about their studies. Messages to supporters were a mix of notifications about key events, including upcoming exam dates, and suggested questions that supporters could ask the student to prompt a learning conversation. A second group nominates study supporters, but did not receive text messages. Costing less than £10 per student, the trial finds that students whose supporters received weekly text messages were 27% more likely to pass their GCSEs than students who had volunteered to be part of the programme but had not been selected to receive supportive messages. The results indicated the potential of the intervention and the team tested another iteration the following academic year, with a different cohort of 900 students. This time both the students themselves and their study supporters receive text messages. Results showed a 32% increase in the exam pass rate. The team then decided to test whether the intervention could be effectively replicated at larger scale by running a trial across 31 further education colleges, involving approximately 4,000 students. Source: Behavioural Insights Team Update Report 2016-17, see: www.behaviouralinsights.co.uk |
4.17 The effectiveness of nudge techniques and lessons more broadly from behavioural economics should also be considered. Nudge techniques may be relevant both in creating efficient and effective options for change, and in identifying and minimising unintended effects. For example, how human behaviour may be affected by small changes in the way in which messages are communicated (see Box 6).
4.18 Options which involve the use of payment-by-results, performance targets or bonus systems require care to avoid unintended consequences resulting from gaming. Where a commissioning body (known as a principal) contracts with another organisation (known as an agent), the lessons of principal-agent theory should be considered.5 The more detailed and complex a reward system is, the more likely there will be unintended and potentially adverse results due to gaming. Such systems work best when the interests of the agent and the principal are completely aligned.
4.19 Public Private Partnerships (PPP) may be an appropriate option to consider in some cases. They can involve a variety of strategic partnering arrangements with the private sector and can potentially provide improved technical capability. They may also provide more cost-effective and efficient risk management through risk transfer and sharing. Where a partnership is envisaged, the interests of the commissioning or procuring body and the private partner need to be well aligned through effective, simple contract design and possible unintended consequences need to be considered at the outset (see Annex 4 for more detail).
4.20 Market creation may be used to deliver objectives. To assess this, an accurate understanding of the current barriers to market provision is needed and an understanding of the market, or potential market, is required. Where relevant, competition effects need to be considered (supplementary guidance can be found on the CMA webpages). It is also necessary to take account of potential gaming and behavioural changes that may result from intervention.
4.21 Annex 1 provides more detail on what to consider when constructing options.
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5 Principal-agent theory here refers to the economic and organisational theory only and not to the concept of a principal or an agent in legal terms.