NHS Gloucestershire keeps £80m community services in public hands

BMJ 2012; 345 doi: (Published 19 October 2012) Cite this as: BMJ 2012;345:e7056
  1. Clare Dyer
  1. 1BMJ

Community health services in Gloucestershire are to stay in the NHS after legal action by a patient to stop outsourcing to a community interest company, in the first decision of its kind.

Michael Lloyd, a retired railwayman living in a care home, argued in the high court that it would be unlawful to hand over the services to the company, which NHS Gloucestershire had created for the purpose, without opening up the contract to competition—although this would not be necessary if services were kept within the NHS.

The legal action ended in an out of court settlement last February, on the second day of a planned two day hearing. NHS Gloucestershire, the primary care trust, agreed to abide by a court order abandoning “at this time” its plans to contract with the company, and requiring it to consult staff and the public and properly consider NHS options.1

Now the board of NHS Gloucestershire has voted to create a new stand-alone NHS trust to take over the services, rejecting the alternative option of opening up the £80m (€98m; $129m) a year contract to private sector bids. Some 91% of staff and 96% of the public had voted for the services to be run by the NHS. Had the outsourcing gone ahead, it would have been the largest transfer in England of community health services outside the NHS, campaigners said.

David Lock QC, Lloyd’s counsel, told the High Court in February that, although services could be commissioned from NHS providers without a procurement exercise, it was unlawful to transfer them to a social enterprise or community interest company without competition. The final outcome of the case was “potentially a very significant policy shift,” he told the BMJ.

Department of Health officials originally advised that the trust would have to investigate whether private providers were interested in competing for the contract, which covers eight community hospitals as well as district nursing, health visiting, and podiatry, before deciding to keep services in the NHS. But they eventually conceded that this was not legally necessary.

Caroline Molloy of Stroud Against the Cuts, which campaigned for the services to stay in the NHS, said, “We were told over and over that there was no alternative to outsourcing our hospitals, but we’ve proved that to be false. We’ve also shown that, despite statements to the contrary, competitive tendering out of the NHS isn’t compulsory and that local health bosses retain discretion to keep all services in house.”

Michael Lloyd said he was “delighted” by the decision to keep the services in the NHS. “Our NHS is too precious to be handed over to anyone on a political whim, nor should it have to compete against private providers who are only interested in maximising their profits.

“The public and the staff who provide my healthcare should have been consulted in the first place so I’m very pleased that our voices have been listened to at last.”


Cite this as: BMJ 2012;345:e7056


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