• Two Lancashire trusts win procurement case against Lancashire County Council
  • Judge found council’s records of its moderation process fell short of standards required
  • Council considering next steps as trusts continue to provide services in the interim
  • Unusual for dispute between public bodies to end up in court

A High Court judge has today overturned a local authority’s contract with Virgin Care for public health services after a successful legal challenge by two NHS trusts.

Lancashire Care and Blackpool Teaching Hospitals foundation trusts took Lancashire County Council to court after the council awarded a five-year £104m contract for school nursing and health visiting services to Virgin Care.

The two trusts were the incumbent providers of the services. 

The trusts claimed the council had failed to apply the scoring criteria correctly, and that other errors and deficiencies occurred during the bid evaluation process.

In their arguments the trusts said they would lose up to £2m of transformation funding and 160 staff as a result of missing out on the contract. 

Mr Justice Stuart-Smith upheld the trust’s challenge, which means the council cannot award the contract to Virgin Care.

In his ruling he found the county council’s records of its moderation process fell short of the standards required to evidence the reasons for the scores awarded to bidders.

HSJ has asked both trusts and the council what they spent in legal fees in relation to the case. 

Shaun Turner, the council’s cabinet member for health and wellbeing, said the council was “disappointed” with the outcome.

He said the council will not be re-running the procurement or inviting new bids because it was only the moderation process that was deemed to be flawed.

The council is considering its next steps. The services in question have been run on an interim basis by the two trusts since the contract expired in April, and will continue to do so until March 2019.

A spokeswoman for the trusts said they had been “reluctant” to take legal action against another public body, but the court’s decision had “borne out our concerns” with the process carried out by the council.

“We believe the connectivity with other wider NHS services is important in terms of being able to fully meet the needs of the children and families who access these types of services in a joined-up way,” she said.

“We hope to engage with the council about the future of the service.”

Virgin Care did not comment.