The NHS has settled a legal dispute with private healthcare group Virgin Care for an undisclosed amount.
The Labour Party said it was “scandalous” that the NHS had to defend a legal battle with the company, which is part of Richard Branson’s business empire. It also called on the Department of Health to disclose details of the settlement.
Virgin Care sued the NHS last year after it lost out on an £82m contract to provide children’s health services across Surrey, citing concerns over “serious flaws” in the way the contract was awarded.
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The company filed proceedings at the UK High Court naming the six local NHS clinical commissioning groups (CCGs) in Surrey, as well as Surrey County Council and NHS England.
Virgin Care and NHS Guildford and Waverley CCG, which was the lead group, both told The Independent that the details of the settlement were “confidential”.
However, NHS magazine the Health Service Journal reports that one CCG inadvertently revealed the settlement had left them with financial liabilities running to hundreds of thousands of pounds.
NHS Surrey Downs CCG initially disclosed that its liability in the case was £328,000 in its October public finance papers, the HSJ reports.
But this reference was subsequently removed with the CCG, saying this level of detail “should not have been included in the report”.
The winners of the Surrey contract, Surrey Health Children and Families Services, a partnership between the local hospital NHS Surrey and Borders Partnership Foundation Trust, and two local social enterprises, took over the service in April.
Spokespeople for Virgin Care and NHS Guildford and Waverley CCG did not comment on what payment, if any, was made, saying: “The parties are pleased to confirm that an agreed resolution on the litigation concerning the Surrey Children’s procurement has been reached to a satisfactory conclusion for all parties with detailed terms confidential to the parties.”
10 companies that have escaped government privatisation - so far
Show all 10
10 companies that have escaped government privatisation - so far
1/10 The Post Office
The Post Office provides the stamps (alongside banking and bill payment services) for the letters delivered by Royal Mail, which floated on the stock exchange in 2012. The same act that privatised Royal Mail also contains the option for the Postal Service to become a mutual organisation – where each post office owned a share of the business – to counter annual losses and branch closures. A spokesperson said: “Privatisation is absolutely not on the cards for Post Office.”
Getty
2/10 Royal Bank of Scotland Group
The UK government owns and manages an 81 per cent stake of the RBS Group through UK Financial Investments – a company set up in 2008 to manage the Treasury’s shareholdings in UK banks. The government’s voting rights are limited to 75 per cent so the bank can continue to be listed on the London Stock Exchange.
Getty
3/10 Community Health Partnerships
Set up in 2001 as Partnerships for Health, Community Health Partnerships is in charge of setting up public-private partnerships to invest in new healthcare facilities in England.
Getty
4/10 London and Continental Railways
This is the company set up to build the high speed railway. Originally private, the company had to be nationalised in 2009 after it ran into financial difficulty. In 2010 a group of Canadian teachers – the Ontario Teachers’ Pension Plan – bought the operating rights for £2.1 billion for 30-years – after which time the government is hoping to sell it for a much bigger sum.
Getty
5/10 Royal Mint
The company that makes all the UK’s coins and notes is wholly owned by the Treasury, which delegates shareholder responsibilities to the government’s Department for Business, Innovation and Skills.
Getty
6/10 Lloyds Banking Group
The Treasury holds a 23.9 per cent stake in Lloyds – a much lower proportion than the 41 per cent it owned after the financial crisis hit in 2008. The government started selling Lloyds shares in 2013 – the latest sale means it has now raised nearly £8 billion from the venture.
Getty Images
7/10 UK Green Investment Bank
A new funding institution created in 2012 to attract funds for environmental preservation and improvement, the Green Investment Bank is structured as a public limited company and owned by the Department for Business, Innovation and Skills.
Getty
8/10 Bradford & Bingley
Shareholders in Bradford & Bingley were not given any compensation when the government bought out Bradford & Bingley in 2008 – many of whom now argue that the takeover was botched job that left nearly a million investors dispossessed.
Reuters
9/10 International Nuclear Services
A wholly owned subsidiary of the UK Government’s Nuclear Decommissioning Authority, INS manages and transports nuclear fuels such as uranium, MOX fuel, irradiated fuel and nuclear waste.
GETTY IMAGES
10/10 Student Loans Company
Ownership of the Student Loans Company is shared between the governments of the UK, with the department for business, innovation and skills owning a majority stake (85 per cent). Since the late nineties, the government has been selling the loans themselves, however. Last year the government said it would start selling the £12 billion book of 1998-2012 loans.
Getty
1/10 The Post Office
The Post Office provides the stamps (alongside banking and bill payment services) for the letters delivered by Royal Mail, which floated on the stock exchange in 2012. The same act that privatised Royal Mail also contains the option for the Postal Service to become a mutual organisation – where each post office owned a share of the business – to counter annual losses and branch closures. A spokesperson said: “Privatisation is absolutely not on the cards for Post Office.”
Getty
2/10 Royal Bank of Scotland Group
The UK government owns and manages an 81 per cent stake of the RBS Group through UK Financial Investments – a company set up in 2008 to manage the Treasury’s shareholdings in UK banks. The government’s voting rights are limited to 75 per cent so the bank can continue to be listed on the London Stock Exchange.
Getty
3/10 Community Health Partnerships
Set up in 2001 as Partnerships for Health, Community Health Partnerships is in charge of setting up public-private partnerships to invest in new healthcare facilities in England.
Getty
4/10 London and Continental Railways
This is the company set up to build the high speed railway. Originally private, the company had to be nationalised in 2009 after it ran into financial difficulty. In 2010 a group of Canadian teachers – the Ontario Teachers’ Pension Plan – bought the operating rights for £2.1 billion for 30-years – after which time the government is hoping to sell it for a much bigger sum.
Getty
5/10 Royal Mint
The company that makes all the UK’s coins and notes is wholly owned by the Treasury, which delegates shareholder responsibilities to the government’s Department for Business, Innovation and Skills.
Getty
6/10 Lloyds Banking Group
The Treasury holds a 23.9 per cent stake in Lloyds – a much lower proportion than the 41 per cent it owned after the financial crisis hit in 2008. The government started selling Lloyds shares in 2013 – the latest sale means it has now raised nearly £8 billion from the venture.
Getty Images
7/10 UK Green Investment Bank
A new funding institution created in 2012 to attract funds for environmental preservation and improvement, the Green Investment Bank is structured as a public limited company and owned by the Department for Business, Innovation and Skills.
Getty
8/10 Bradford & Bingley
Shareholders in Bradford & Bingley were not given any compensation when the government bought out Bradford & Bingley in 2008 – many of whom now argue that the takeover was botched job that left nearly a million investors dispossessed.
Reuters
9/10 International Nuclear Services
A wholly owned subsidiary of the UK Government’s Nuclear Decommissioning Authority, INS manages and transports nuclear fuels such as uranium, MOX fuel, irradiated fuel and nuclear waste.
GETTY IMAGES
10/10 Student Loans Company
Ownership of the Student Loans Company is shared between the governments of the UK, with the department for business, innovation and skills owning a majority stake (85 per cent). Since the late nineties, the government has been selling the loans themselves, however. Last year the government said it would start selling the £12 billion book of 1998-2012 loans.
Getty
When news of the legal dispute was first announced, NHS Guildford and Waverley had said the group were “confident” in their commissioning processes.
Shadow Health Secretary Jonathan Ashworth said: “It’s scandalous that NHS money is being wasted on fighting off legal bids from private companies.
“Ministers need to make clear how much public money has been used in this case – at the least it seems to be hundreds of thousands of pounds. That is money that could be being used for NHS patients who are waiting longer than ever for routine services.”
NHS England referred The Independent to Guildford and Waverley CCG, which had not responded at the time of publication.
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