News
MPs advised to change NHS rules encouraging “defensive procurement”
The Health & Social Care Select Committee has been hearing recommendations from two panels on reforming or repealing existing NHS legislation that mandates contracts over £615,278 in value being out out to tender in the public sector. According to publicfincance.co.uk:
Katherine Checkland, a GP and professor of health policy and primary care at the University of Manchester, told the committee: “We found procurement regulations in particular have been a real problem.”
Checkland added: “We found people doing what you might call ‘defensive procurement’. They feel like they have to [put contracts out tender] because they are not sure whether they are going to be subject to legal challenges.”
She noted that where there have been legal challenges this has led to a “huge waste of everybody’s time and effort”.
The issue is highlighted by a case from 2018, in which Virgin Healthcare successfully sued a group of clinical commissioning groups in Surrey for £2m after having failed to win a contract: the rules on procurement are complex, unclear and obfuscatory, and it is argued that CCGs sometimes end up putting contracts out to tender unnecessarily as a result.
Regarding the evidence presented to the select committee, proponents of full renationalisation shouldn’t get too excited just yet:
Ian Dalton, chief executive of the watchdog NHS Improvement, said: “We are not saying that this is an end to any use of procurement.
“What we are saying is that the experience – particularly in community services – has become almost an expected part of the way business is done.”
The weariness implicit in that statement will surely resonate in other parts of the public sector.