Those keeping their eye on public procurement matters in the UK over the last few months will no doubt have been aware of the controversies surrounding the implementation of the new Health and Social Care legislation which seeks to increase competition in the provision of health services in the UK and which may, some believe, lead inexorably to the privatization of the system. The new Health and Social Care Act (2012) removes the fundamental duty previously placed upon the Secretary of State for Health to provide health services, a key feature of a system which has operated, for good or for ill since 1946, and which made the system a properly “national” one with countrywide political oversight.
I think there are three major changes resulting from the Act that stand out for me as having significance for public procurement: new procurement responsibilities are to be given to newly formed Clinical Commissioning Groups and the EU procurement directives will apply, but so will a set of potentially ambiguous procurement rules specific to the Act (section 75). A national Monitor organisation will also supervise the new arrangements and may take action under Competition Law (both UK and European).
These are big changes to the UK healthcare system and more radical than anything seen so far, including under the previous Conservative administration whose GP fund holding implemented a far more limited version of what is now being tried. The Clinical Commissioning Groups which are at the heart of the new system are unlikely at this stage to have all the skills and capabilities they need to handle procurements under the rules. There is no saying how the CCGs will deal with the different procurement rules that now apply. And if procurements are not operated by the book, a wide range of legal remedies will be available to any organisation willing and with funds to complain.
We are reminded yet again of the complexities of public procurement and its centrality to the achievement of some of the UK government’s most important objectives, in this case the marketisation of health care provision in the UK, although we have seen a big emphasis on using procurement generally to promote innovation as well.
So why is public procurement so close to controversy? It’s because it’s what the government does, and there’s no getting away from the fact that what the government does is political.