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Learning legal lessons from the transforming community services scheme

Transforming community services was characterised by a transitional approach that is relatively new in the context of NHS organisations. However, it certainly won’t be the last as the health reforms continue, writes Hempsons associate Faisal Dhalla.

This article provides insight into the key learnings transforming community services (TCS) can provide from those who went through the programme and those providing legal advice.  

TCS was a change programme by which all primary care trusts transferred their provider arm functions to other NHS organisations and, in some cases, to staff led social enterprises which were born out of the PCT. For a short time, before further reorganisations follow, PCTs focus on commissioning activities and continue to be responsible for planning and commissioning healthcare provision in their area by contracting with providers. 

NHS East Riding of Yorkshire director of commissioning Alex Seale guided her organisation through the TCS change and feels they are better for it.

“Preparation is the key with any transaction like TCS and we benefited greatly from planning ahead. At the latter stages of the process, there was a lot of work that had to be completed quite quickly and having an experienced support team and legal advice was vital in ensuring we hit all deadlines in particular the key one in April.

“Also, staff involvement was key for us. We wanted to ensure there was a constant flow of consultation throughout the whole process and this paid dividends.”

NHS Leeds associate director of commissioning Matthew Ward found the TCS process cathartic from a housekeeping point of view.

“TCS was a great exercise for NHS Leeds in expanding knowledge of our current contracts and commitments. The process required a lot of detail to be submitted and it forced us to review where we were as an organisation in a number of areas.

“For future transactions we now know the depth of information required and can effectively plan ahead to allow for the time needed to collate it.”

Faisal Dhalla, associate at Hempsons, worked on almost 20 TCS transactions between May 2010 and April 2011 working for a variety of NHS organisations right across the UK. Based on experience, he picks out some key learning points:

Resource allocation and management

“It’s a common mistake to underestimate the work involved and the number of people needed to work on transactions such as this. Have an internal project team set up as soon as possible and have a project lead – be prepared. Ensure regular meetings are pre-scheduled to discuss progress and solve the problems which will inevitably arise.”

External advisors

“For any sophisticated transaction such as a TCS transaction, you will need external support and expertise. Identify the advice you will require early on and appoint your advisors as soon as possible. If you involve your advisors from day one, they can identify potential problem areas for you sooner rather than later.”

Internal processes

“With a new programme to go through such as TCS, ensure you have dedicated internal processes to manage activity such as due diligence and also put in place document systems to manage document flow. Delegate responsibility to one person or a particular team to manage and update those processes as the transaction evolves.”

Risk management

“You can use the due diligence process to identify potential risk areas and identify whether you are going to take those risks on and if so, how you are going to mitigate them. Involve your advisors in this process and look at risks from a legal, financial and commercial perspective. Consider appointing one person to be in charge of risk management and they can update all involved at those regular pre-scheduled meetings.”

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