• Council will pay £200,000 legal costs to both NHS trusts after court case
  • This is the second time the trusts have taken Lancashire County Council to court
  • Contract procurement process will be repeated with independent panel

Two NHS trusts will receive £200,000 from a county council after they won a court case over a public health services contract tender, which had been awarded to Virgin Care.

Lancashire County Council will now re-run and complete its tendering process for public health services for 0 to 19-year-olds by re-evaluating the two existing bids from Virgin Care and a joint bid from Lancashire Care Foundation Trust and Blackpool Teaching Hospitals Foundation Trust.

The trusts previously took Lancashire CC to court after the council awarded a five-year £104m contract for school nursing and health visiting services to Virgin Care. The trusts, which were the incumbent providers of the services, successfully overturned Lancashire’s decision to award the contract to Virgin Care.

According to the Local Government Chronicle, Mr Justice Stuart-Smith 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. 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.

The county council has agreed to pay the health trusts’ most of their legal costs for bringing the case. Although a final figure has not yet been produced, the council has anticipated it will be in the region of £200,000 which would be around 75 per cent of the total costs.

The procurement process will now be re-run with a new independent panel, which will make the decision over who will be awarded the contract.

Shaun Turner, cabinet member for health and wellbeing, said: “We will now be able to move forward to finalise this procurement process and we have also agreed to pay 75 per cent of the trusts’ legal costs for this case, which will mean we do not have to go back to court.

“Where services such as the 0-19 public health services are not being delivered in house, we are under a legal duty to open them up to competition and the decision to do so in this case was in no way political.

“The existing contract with LCFT and BTHT does not expire until March 2019 so the public can be reassured that there will be no disruption to these important services.

“Health visitors and school nurses all do a fantastic job and we will continue to support them in any way we can to ensure children and families continue to receive a good service.”