The author of a major government review on provider sector reform has rejected the suggestion that the collapse of the Hinchingbrooke contract should spell the end of franchising in the NHS.

Sir David Dalton’s health secretary commissioned review described management franchises as one of a series of organisational forms with “the potential for wider adoption across NHS providers”.

Publication of the review came just a month before private provider Circle announced plans to pull out of its franchise to manage Hinchingbrooke Health Care Trust, the only such deal in operation in the health service.


Sir David Dalton said Circle’s exit does not mean the concept of franchising is ‘dead and buried’

But speaking after the news broke, Sir David said it was “a big step to say one failure equals the concept being dead and buried”. He added: “[Problems with] one contract with one provider in one locality in Cambridgeshire does not mean, in itself, that there is a problem with one organisation managing another.

“We see failures regularly in NHS organisations, which are disguised by spending £600m of taxpayers’ money last year, propping up their balance sheets.

“This financial facility was not available to Circle.”

However, Sir David made clear that he thought the potential of franchising was more likely to be as a means for NHS foundation trusts to take on management of failing counterparts, rather than the independent sector.

He anticipated there would still be a number of NHS organisations interested in considering whether a franchise model was “the right thing for them to do”.

Sir David also suggested that other organisational forms outlined in the his review should now be considered when looking at the future for Hinchingbrooke.

“If we were to look at Hinchingbrooke now,” he said. “I am sure there should be consideration of new models outlined in [the review] to share back office functions, to create single shared service agreements for some of their elective services, and to pursue integrated services for long term conditions and urgent care.

“Hopefully the opportunities will not now be missed to provide reliable care for the people who use Hinchingbrooke’s services.”

Dalton: Hinchingbrooke collapse does not scupper franchise model