Virgin Care Challenge Health Contract Decision in Surrey

Excitement (but not of a good kind) in the county of Surrey, home to the nerve-centre of Spend Matters Europe. Virgin Care, a private sector health services provider, has run community health services in the county since 2012. But in a recent competition, the firm lost out to a social enterprise type bidder on an £82 million contract for children’s community services. Virgin has now announced it will challenge that decision, made by eight local commissioners, citing procurement irregularities.

Virgin has made major inroads into the UK community health world in particular. The private company won probably their biggest contract to date in the sector in late 2016 and will take over a seven-year, £700 million contract to run community health and social care services in Bath and North-East Somerset next month. The firm has had many other smaller contract wins too, leading to critics claiming that this is “NHS privatisation by stealth”.

Back to the Surrey situation - many private sector firms in our experience don’t challenge procurement decisions, even when they think they are unfair and/or illegal. The firms worry that their reputation will be affected if they are seen as awkward people and that will affect their chances of winning further work. Clearly, Virgin aren’t thinking in that way. So either they are pretty confident of winning this case, or they just don’t buy the idea that what they do in Surrey matters elsewhere in such a devolved environment as health.

Actually, my feeling has always been that having a reputation as a supplier who is prepared to challenge might not be a bad thing at all. Might it make buyers more cautious – even perhaps more generous – when it comes to evaluating bids?

Anyway, we will watch this case with interest. We don’t know much about the capability of health commissioning in the county, although Surrey county council itself has one of the strongest procurement functions in local government. Watch this space.

Voices (2)

  1. Final Furlong:

    I live in hope that this wasn’t due to the procurement process.

    I recall the infamous Westminster City Council car parking contract procurement. Ouch. This still happens, and often…
    http://www.standard.co.uk/business/revealed-fiasco-of-westminster-s-parking-contract-6469407.html

    1. The Guitar Man:

      ….or the Portcullis House windows!

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