Commissioners in the South West have given a damning verdict of NHS England’s lead provider framework for commissioning support services. They say it is likely to land them with a worse service that costs more.

  • Four CCGs issue damning verdict on lead provider framework
  • Framework will lead to a service with “higher cost and lower quality”, CCGs say
  • Procurement halted for at least a year
  • NHS England criticised for “informal” talks with suppliers

The group of four clinical commissioning groups “paused” their procurement last month for at least a year because their concerns with the process were so significant.

The CCGs are:

  • Bristol;
  • Somerset;
  • North Somerset; and
  • South Gloucestershire.

A report published by North Somerset CCG this month, seen by HSJ, set out a range of unresolved problems with the lead provider framework. It says the CCGs believe using it “is likely to result in a service with a higher cost and lower quality than the existing commissioning support service”. The report has since been removed from the CCG’s website.

The framework is designed to make it easy for CCGs to choose an accredited supplier of support services.

The nine main concerns identified by CCGs are:

1. “Issues of transparency and conflict of interest”

These arise from NHS England liaising with suppliers on behalf of CCGs, rather than allowing CCGs to manage the process themselves. As a result, CCGs cannot assure themselves that the process “meets good practice standards for procurement”, the report said.

2. Information on staff transfer being hidden from CCGs

“CCGs have not been allowed to see [transfer of undertakings] information circulated to suppliers,” the report said. NHS England’s analysis of staff costs has not been validated by “people who know what is happening on the ground”. TUPE is likely to apply if a CCG chooses to switch its support service provider.

3. The possibility of a “lack of viable bids” from suppliers

This could be caused by “inaccurate information” given to suppliers by NHS England on staffing costs. CCGs would not be able to evaluate any bids they did receive because NHS England will not share its analysis of staff costs (see above).

4. “Ongoing discussions between NHS England and suppliers in informal settings”

These have been taking place in addition to the formal procurement process. CCGs were “unaware of the content and nature of discussions and [are] concerned that expectations are not being managed appropriately”.

5. CCGs cannot undertake the usual due diligence checks on suppliers

This is because they are not allowed to see the original submissions from suppliers to be included on the lead provider framework, or, they say, ask questions about them. “Governing bodies are very unlikely to accept this process as sufficiently robust as they would have to ‘take on faith’ the competency, capacity and safety of the provider without seeking their own assurance,” the report said.

6. VAT

The CCGs say NHS England has not shared information with them on whether VAT will be charged on support services if they bring in a new supplier. Although NHS England has assured them the risk is “not likely to be significant”, any VAT that is charged in future is not currently funded. VAT was first identified as a potential stumbling block more than a year ago.

7. The “prohibitive” cost of bringing some services in house

TUPE and “stranded costs” are given as the reason, but the CCGs were still seeking to understand “why services which are already significantly more expensive than CCGs’ own staffing costs will cost even more if they are in-housed”.

8. The ability of suppliers to deliver services on tight budgets set by CCGs

“Suppliers have expressed concern at the overall cost envelope,” the report said. But an “increase in envelopes would represent poor value for money”.

9. A lack of focus on the importance of relationships between CCGs and suppliers

Cost and performance indicators have taken precedence, despite CCGs agreeing that “relationships were key to success”. As a result, there is a risk that “positive working relationships will take a long time to develop”.

The report followed five months of work on the joint procurement.

Six NHS commissioning support units and three private providers are on the framework.

The four CCGs had initially been keen to use the framework to procure support services, to resolve problems with the cost and quality of services they had been receiving from South, Central and West CSU.

A spokesman for the CCGs said: “We can confirm that the information HSJ has seen is part of a briefing paper produced this month to update the CCGs on potential risks arising from the current procurement arrangements in the tendering of its commissioning support services. 

“The procurement process may be paused while we obtain answers to specific questions, but is expected to continue in the future. As the process is still ongoing, it would be inappropriate for the Bristol, North Somerset, Somerset and South Gloucestershire CCGs to comment any further at this stage.”

An NHS England spokesperson said: “Given the need to make efficiencies in NHS commissioning back office costs, it’s just not feasible for each and every CCG to reinvent the wheel on analytics and business intelligence, which is why to cut procurement costs and improve commissioner sophistication we’ve created a streamlined national call-off framework of credentialed expertise which they can use.”