The Guardian reports on some of the problems with local authorities assessing "Big Society" offers. On the whole, it underestimates the extent of the problems, especially in today's increasingly litigious climate.
Particularly on procurement, the piece does not give the full flavour. Challenging the award of contracts has become increasingly common. This is helped by a change in practice. Previously, a successful challenge would simply lead to a rerun of the tender. Now you can claim compensation for the profits you would have made. There are plausible rumours that companies are building a few successful challenges into their business model. Of course, that tends to benefit major players who can afford smart lawyers. The more local, volunteer type groups often have little expertise in putting bids together. It is hard for officers to help them because (a) resources are stretched (b) Too much help to one group can itself breach procurement regulations.
Other problems the article does not cover include planning service provision. The availability of volunteers does not necessarily match the areas of need. Given that there are virtually bound to be hidden costs in any scheme in terms of management, all kinds of business support and so on, that is likely to lead to services being planned according to who shouts the loudest rather than on a rational basis.
The other big omission is "moral hazard". If the service is much valued, government is always likely to step in if a group fails. If you take Southern Cross, it would hardly be politically possible for the government to leave the people in Southern Cross homes to just fend for themselves. Hence the private sector could take as many risks as they liked knowing that the taxpayer would pick up the pieces.