UK

Millions of pounds 'wasted' on doomed NHS contract

Millions of pounds of taxpayers' money was wasted on a doomed NHS contract to outsource the care of older and mentally ill people, investigators have found PICTURE: John Stillwell/PA
Millions of pounds of taxpayers' money was wasted on a doomed NHS contract to outsource the care of older and mentally ill people, investigators have found PICTURE: John Stillwell/PA Millions of pounds of taxpayers' money was wasted on a doomed NHS contract to outsource the care of older and mentally ill people, investigators have found PICTURE: John Stillwell/PA

MILLIONS of pounds of taxpayers' money was wasted on a doomed NHS contract to outsource the care of older and mentally ill people, investigators have found.

A National Audit Office (NAO) report pointed to several mistakes and misgivings over the contract between Cambridgeshire and Peterborough Clinical Commissioning Group and UnitingCare Partnership, which collapsed after just eight months.

UnitingCare, an NHS consortium of Cambridgeshire and Peterborough NHS Foundation Trust and Cambridge University Hospitals NHS Foundation Trust, pulled out in December after saying the deal was not financially viable.

The contract - worth around £800 million - was the biggest in NHS history and was designed to bring together hospital, mental health services and community care for adults and older people in Cambridgeshire.

The NAO report criticised the planning for the contract, the lack of data informing the true cost of the service, and the role of NHS England and Monitor in providing oversight.

It said several costs were not factored in, with some critics arguing the cash set aside for redesigning services was insufficient. Clauses in the contract also provided "significant financial risks" for the CCG.

Amid a range of other problems, UnitingCare Partnership agreed to begin the contract from April 2015 while "continuing to negotiate on cost clarifications".

One month into the contract, UnitingCare Partnership requested £34 million of extra funding for the first year, some 21 per cent more than the contract price for that year.

But in the December, the CCG said it could offer no further advance funding, leading to the collapse of the contract.

This resulted in £16 million of "unfunded costs that had been incurred between the CCG and the partner trusts", the NAO said. The CCG paid half this cost and the trusts split the difference.

Alongside this overspend was a £8.9 million direct cost to the NHS due to the set-up, bid and termination costs of the contract.

A previous deal with the private sector in Cambridgeshire also collapsed in 2015. Then, Circle, which ran Hinchingbrooke in Cambridgeshire, from 2012, said budget cuts and high demand made its deal unsustainable.

The NAO said the termination of the UnitingCare deal "indicates that the health sector may not have learned lessons about assessing and managing risk when working with a private provider, despite the earlier failure of the Hinchingbrooke contract and experience in wider government."

The report also said NHS England and Monitor acted in accordance with their statutory roles "but, ultimately, regulatory checks on individual bodies' risks did not ensure that the contract was viable".