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£600m worth of savings at risk
Procurement challenges often result in dreary court cases where minor points are endlessly quibbled, but the battle between the Department of Health and Social Care and DHL Supply Chain is anything but boring.
DHL Supply Chain, the incumbent provider of the expiring NHS Supply Chain service, has taken the DHSC to court after missing out on a £730m logistics contract tendered as part of a new procurement model for the NHS.
The company, which hit the news in spring for its failure to deliver enough chicken meat to KFC, accused the department of “misdirection” and making “manifest errors” during the procurement.
DHL Supply Chain claimed preferred bidder Unipart could not possibly have the expertise to deliver the contract, and asked the court to reverse the decision.
But the DHSC denies running a flawed process and – at a hearing this week – warned a High Court judge of the dangers of allowing the case to go to full trial.
The department’s barrister said delays to the awarding of the logistics contract pose risks to the implementation of the new wider procurement model, which aims to deliver annual savings of up to £600m.
If the issue is not resolved by September, then the model’s implementation will go beyond the already extended deadline of April 2019 – coinciding with potential uncertainties arising from the UK’s scheduled exit from the European Union.
Mrs Justice O’Farrell is set to decide in the next few days if the DHSC can award the contract to Unipart, or if a full trial is necessary.
Ask the cancer patient
NHS England has been urged to stop a “perverse” policy of withholding transformation money from areas breaching the 62 day cancer target.
John Baron, who stood down as chair of the all party Parliamentary group on cancer last month after nine years, told HSJ it was “perverse in the extreme” to withhold funding from areas, which seemingly need the money most.
The arrangement of only awarding funding once process targets are hit is of course not unique to cancer.
The £1.8bn “sustainability and transformation fund” has been issued on a similar basis, with those holding the purse strings reluctant to hand out money for nothing, or to reward failure.
But is this really the fairest way to allocate funding and drive improvement? A cancer patient finding themselves in a poorly performing area by no fault of their own would likely argue that it isn’t.