Commenting on today’s decision, NHS Partners Network chair Mike Parish, said:

“We believe that underlying this decision is recognition that ‘NHS only’ procurement is unacceptable and potentially unlawful.

“Whilst we appreciate that NHS Great Yarmouth and Waveney was following what it understood to be a change in policy, our view remains that the proposed procurement process would have been against the interests of patients and taxpayers. The Department of Health’s approach to community services is deeply concerning. The approach will need to be challenged if it leads to the awarding of uncontested contracts or unjustifiable structural changes which are not in the interests of patients and taxpayers and could run contrary to the principles of procurement law.

 “We remain convinced that the ‘preferred provider’ concept and policy is in itself anti-competitive and will result in a failure, across the NHS, to secure value for money, or to drive continuing improvements in quality and encourage innovation.  A significant opportunity to clarify these issues and thus help the NHS through the difficult years ahead has been lost.

“This outcome also leaves open the question of whether investors in UK healthcare can genuinely rely on a ‘rules-based’ system, consistent with wider procurement and competition law, or whether the rules may be easily overridden by changes of policy. The behind the scenes compromise inevitably suggests that the CCP, as a mechanism for maintaining a ‘rules-based’ system, may not be sufficiently independent of ministers and of the system it is meant to regulate.

“Giving the CCP genuine independence and aligning its powers more closely with those of other competition authorities must now become a high priority if the prospects of securing investment and innovation in UK healthcare are not to be gravely damaged at a time when public funds are in very short supply.”