MPs demand more transparency over £1bn private hospitals deal

NHS England chief rapped for failure to publish ministerial direction letter on time
Letters between Sajid Javid (left) and Amanda Pritchard were not published promptly. Photo: PA Images/Alamy Stock Photo

The chair of parliament’s Public Accounts Committee has written a sternly-worded letter to the head of NHS England after the organisation failed to publish an exchange with the health secretary.

Earlier this month, Sajid Javid issued a written ministerial direction authorising plans to put private hospitals on standby to support NHS services at risk of being overwhelmed by the Omicron variant of Covid-19 – at a cost of between £75m and £90m a month.

In her letter to Pritchard, Hillier said the committee was not given a copy of the ministerial direction until 11 January – three days after Javid’s reply to Pritchard, and a day after NHS England made the deal public. By this point, the arrangements were already in effect.

Pritchard’s letter to Javid, and the health secretary’s reply, were published a day later, on 12 January.

“This is not in line with the guidance issued to all accounting officers in December 2021 by the Treasury officer of accounts, which clearly stated all ministerial directions must be published promptly on GOV.UK and that the chair of the Committee of Public Accounts must be made immediately aware,” Hillier wrote.

“I do not expect such a delay to occur again,” she added.

Hillier also used her letter – which was sent on 18 January but published this week – to press the NHS chief exec for more details on the deal.

She had promised to investigate the deal further after a contentious evidence session earlier this month, in which the MPs quizzed Department for Health and Social Care permanent secretary Sir Chris Wormald about why better surge-capacity plans had not already been put in place, two years into the pandemic.

The MPs were particularly concerned that the deal NHS had signed with private providers contained a minimum income guarantee, which committee member Sir Geoffrey Clifton-Brown described as a “very expensive insurance policy” given the estimated cost of the deal added up to £1bn a year before a single service had been delivered.

Hillier asked Pritchard to confirm when the contracts were signed, and why contingency arrangements for additional capacity for the NHS were only put in place in January, “given that significant winter pressures are an annual event”.

She also asked why health service bosses had concluded there was a “significant risk” that local NHS general and acute bed capacity – including surge capacity – could be overwhelmed, and why the private sector deal was deemed to be the best value for money approach to managing that risk.

When requesting a ministerial direction from Javid, Pritchard had said there were elements of the proposals that carried value-for-money risks.

Among other things, she said agreeing to a minimum income guarantee meant there would be a “material risk that the NHS pays for activity that is not performed”.

In his response, Javid said the need to protect NHS services and prevent a further reduction in NHS capacity were “compelling reasons” to justify the measures.

Neither letter indicated whether other options had been considered, and how the value for money provided by the chosen approach might compare to other options.

Hillier therefore demanded to know whether NHS England had identified other – and potentially better value for money – viable options, but been instructed to use independent providers instead.

The MP asked Pritchard to confirm whether she had carried out an accounting officer assessment – as is good practice for each “novel and contentious transaction or proposal involving the use of public funds”, according to Treasury guidance – or reviewed and signed off a business case for the chosen approach.

Hillier also asked whether Pritchard had discussed the idea with the Treasury, and what advice she had received in response.

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