Published: 18/11/2004, Volume II4, No. 5932 Page 9
The ability of foundation trusts to bid for work set aside for independent treatment centres hangs in the balance this week.
Senior policy makers at the Department of Health and Number 10 are reviewing a paper written by DoH director of delivery John Bacon which sets out three options. The first two would see foundations either blocked from bidding, or allowed to; the third would allow them to bid in joint venture with private sector suppliers as long as the trust had no more than 49 per share holding.
The next wave of ITC work - estimated to be worth around£500m - is due to be tendered in January.
However, according to a source close to the debate, ministers and the DoH's commercial directorate are concerned that allowing foundations to bid would be seen by independent providers as 'the NHS keeping it in the family'. This would undermine confidence in the government's commitment to increasing public sector involvement in the NHS and, as a result, reduce the number of bidders in January.
David Lock, head of healthcare at law firm Mills and Reeve, which represents some foundation trusts, told HSJ that because they have now been established as companies, he could not see any 'justifiable competition law reason' that would stop foundation trusts from being able to apply for the work.
A spokesperson for Monitor, the independent regulator, and Sue Slipman, director of the Foundation Trust Network, agreed.
Ms Slipman said that this was 'a fundamental and crucial part of the freedoms of foundation trusts...it is critical that they are allowed to bid for the work to encourage other trusts to apply for foundation status in future'.
She added that if trusts were not able to bid for the work, it would signal a further curtailment of their freedoms.
University College London Hospitals foundation trust chief executive Robert Naylor told HSJ that although he had sympathy with the DoH's argument about engaging the private sector, he would like the opportunity to compete for the work.
'I also cannot see any reason why the private sector should object [if there is a level playing field] because they thrive on the mantra of competition, ' he added.
Moorfields Eye Hospital foundation trust chief executive Ian Balmer agreed: 'We applied as an NHS trust in the last round of procurement in a joint venture with a US company, so there should be no reason that it should not be open to foundation trusts this time.' University Hospital Birmingham foundation trust chief executive Mark Britnell said it was clear that 'the DoH is wrestling with the tension between two policy objectives, but I believe that tension can be happily resolved'.
The head of business solutions at a domestic private healthcare provider intending to bid for the work told HSJ that as long as there was 'a level field so that the foundation trusts were not allowed to use the advantage of being partially publicly funded, then we would be happy to go head to head with them'.
Sheffield Teaching Hospitals foundation trust chief executive Andrew Cash confirmed that foundation trust chief executives had raised the issue with the DoH and were awaiting a verdict: 'If we are allowed to bid for the work, we would also need to be a clear about the bidding process and how the tenders are judged, ' he said.
Some foundation trust chief executives have also threatened to raise the issue with the Office of Fair Trading and the Competition Commission if they are not allowed to bid.
A DoH spokesperson said that no decision had yet been taken: 'This will be decided in advance of any procurement announcement or tendering process and will be decided upon in consultation with our legal team.'
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