Foundation trusts left to make buying mistakes

16 March 2011

16 March 2011 | Angeline Albert 

Most UK health trusts are not held to account over procurement failings, the head of the NHS told the Public Accounts Committee (PAC) yesterday.

The majority of hospitals (129 of 165) are foundation trusts which are outside the Department ofHealth's direct control. This means they remain unaccountable for their buying activities, despite making some poor purchasing decisions as was highlighted in a recent National Audit Office report.

PAC members quizzed NHS chief executive Sir David Nicholson about how trusts with devolved buying powers are incentivised to achieve savings since a large number are not achieving efficiency targets. In response he admitted he had “limited powers” to “influence procurement activities within and between foundation trusts”.

Sir David said that although he had “no power to make it happen”, it was more a matter of foundation trusts being able to deliver efficiency by getting information systems right. “The idea that we can do all this from Whitehall is nonsense,” he said.

When asked how he was going to get foundation trusts to engage with national procurement, he said: “We will work with [the NHS Supply Chain] to ensure the offer they make to trusts is so good that they cannot not use them.”  

When the PAC raised concerns about NHS Supply Chain prices sometimes being more expensive than other options, Sir David said finding a technology-based solution that would enable trusts access to real time prices could be a solution.   

Committee chairwoman Margaret Hodge MP said she was confused how health purchasing could be managed between so many different groups - NHS collaborative procurement hubs, NHS trusts with in-house buying teams, the NHS Supply Chain, Buying Solutions and the National Procurement Council. She also raised a concern about the privatisation of some hubs.  

In response, Howard Rolfe, director of procurement at the East of England NHS hub, which will not be privatised, said: “There is a pyramid structure of national, local and regional purchases. At a national level we have NHS Supply Chain but it is the middle level of hubs and private sector organisations that is complex. There is conflict between hubs trying to take over the work of other hubs. I personally don’t think hubs going to the private sector is useful.”

The recent NAO report described NHS procurement activities as poor value for money, in part due to huge variations in prices paid by trusts. The committee asked what was going to be done about the report’s discovery that 652 different types of surgical gloves were bought by the NHS. Rolfe said in order to reduce the options there was a need for more transparency and currently there was no data to compare prices and items paid for by trusts.

Under the Health and Social Care Bill, the government hopes to turn all hospitals into foundation trusts.

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