COMMERCIAL: A primary care trust’s claim it could not transfer its provider arm to an NHS organisation is “inaccurate and flawed”, the High Court has heard.

During the first day of a two day judicial review hearing, the court heard NHS Gloucestershire had repeatedly insisted to staff and the community that the only alternative to a social enterprise would be a private provider.

The transfer to Gloucestershire Care Services Community Interest Company has been on hold since Stroud resident and service user Michael Lloyd, 75, launched a legal challenge in September.

David Lock QC for Mr Lloyd said the “central complaint” was that by not putting the services out for procurement the PCT had removed the opportunity for the services to stay in the NHS.

“Up and down the country, NHS trusts are winning contracts… the argument that the claimant is no worse off because inevitably these services will go to a private provider is simply inaccurate and… flawed,” he said.

The court heard lawyers for NHS Gloucestershire have argued in court papers that Mr Lloyd should not be able to bring the case because he had not launched it until the transfer had taken place and is not an “economic operator”, so did not have a legitimate interest in the procurement process.

Mr Lock said the absence of a public consultation meant Mr Lloyd had been unaware of the porposals until it was decided and was legitimately concerned that, unlike an NHS organisation, GCS would not have a statutory duty to consult patients in development of services and would not be exempt from VAT, reducing the amount of money available to spend on services.

The ability of GCS to attract the best staff without being able to offer an NHS pension scheme was also a concern for Mr Lloyd, he said, dismissing the defendant’s claim the loss of an NHS pensions would not be a big issue for healthcare staff joining the organisation.

He added: “Which planet is the PCT on it doesn’t think that pension rights are of crucial interest to staff?”

The PCT will make its case tomorrow.