NHS England must rethink outsourcing after contract shambles

25 July 2018

The Public Accounts Committee report finds short-sighted rush to achieve savings paid no heed to impact on patients or practitioners.

NHS's outsourcing to Capita a shambles

NHS England’s outsourcing of primary care support services to Capita Business Services Ltd (Capita) was a shambles.

Its short-sighted rush to slash by a third the £90 million it cost to provide these services was heedless of the impact it would have on the 39,000 GPs, dentists, opticians and pharmacists affected.

Capita recognises that the service it provided was not good enough. Its failures have not only been disruptive to thousands of GPs, dentists, opticians and pharmacists, but potentially have also put patients at risk of serious harm.

NHS and Capita ignored basic rules of contracting

We acknowledge that Capita has now apologised for its mistakes and will hold it to its commitment to improve services over the remaining life of the contract.

Neither NHS England nor Capita understood the service that was being outsourced, and both misjudged the scale and nature of the risks. They ignored many of the basic rules of contracting, and, once problems emerged, did not do enough to stop the issues from getting worse.

Rather than focussing on improving the service, NHS England and Capita have spent too long disputing basic elements of the contract and are still in disagreement over future payments.

It is clear that NHS England ignored the many lessons this Committee has constantly highlighted about how to outsource effectively and benefit both users and taxpayers. 

Chair's comments

Comment from Committee Chair, Meg Hillier MP:

"NHS England made a complete mess of what could have been a responsible measure to save taxpayers’ money.

It is clearly unacceptable that poor procurement should put patients at risk of harm and undermine the ability of GPs, dentists, opticians and pharmacists to do their jobs.

NHS England needs to rethink its approach to outsourcing and invest time in getting its contracts right.

That means listening to concerns from the frontline and properly considering the impact changes will have on services and public health. But it also means establishing an effective relationship with the supplier.

The dismal fall-out here, with NHS England and Capita squabbling over details that should have been agreed in 2015, tells its own sorry tale.

As we have seen time and again, take away the pillars of best practice and there is every chance a contract will collapse—at the expense of taxpayers and service users.

Central government must show leadership and ensure Government departments and agencies do the job properly."

Further information

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