Is the NHS Corporate Takeover Bill pushing Foundation Trusts into “partnerships” with private companies for capital investment?

  • Private companies are increasingly stumping up the capital funding for new hospital diagnostic centres, in exchange for hospitals’ payment for use of the diagnostics equipment.
  • Recent examples include Alliance Medical’s £10m capital investment in the new South Tyneside FT diagnostics centre and Rutherford Diagnostics’ capital investment in a so-called Community Diagnostics Centre for Somerset NHS Foundation Trust – (info here – scroll down to section headed: ‘Increasing privatisation of NHS diagnostic services’.)
  • These investments are in line with a 2015 strategic plan for increased private company investment in NHS capital, capacity and capability. Launched by West Yorkshire Integrated Care System Chief Exec Rob Webster in 2015 when he was Chief Exec of the NHS Confederation, the strategy report is downloadable from the Independent Health Providers Network.
  • A recent poll commissioned by Open Democracy that found that UK voters are seriously worried that greater use of private companies by the NHS could lead to a decline in standards and a loss of money to NHS hospitals. This is at odds with Rob Webster’s 2015 strategic plan for increased private company investment in NHS capital, capacity and capability, which claimed that NHS privatisation was not an issue for 79% of the public.

The strategic plan for increased private company investment in NHS capital, capacity and capability was to be delivered through Sustainability and Transformation Plans/Partnerships – intended as a massive vehicle for NHS privatisation. Additional NHS “Sustainability and Transformation” funding that the government announced in its 2015 Comprehensive Spending Review came with the condition that it was used to increase opportunities for the private sector in the NHS:

“The government will encourage long term partnerships between the NHS and the private sector to modernise buildings, equipment and services, and deliver efficiencies, especially where these partnerships support the upgrade of diagnostics capabilities and the development of new models of care, such as Accountable Care Organisations and hospital groups.” (para 2.48, p 94).

The contentious Health and Care Bill aims to create a legal (statutory) basis for the Sustainability and Transformation Plans’ successors – the 42 Integrated Care Systems that were set up on a non-statutory basis across the whole of England by April 2021.

MPs are due to debate the Amended Bill at its Report and 3rd Reading on November 22nd and 23rd.

The Bill – dubbed the Corporate Takeover Bill by its many opponents – seems set to drive NHS Foundation Trusts to look to private companies to provide the infrastructure for key capital developments

The Health and Care Bill gives NHS England a new power to set capital limits to Department of Health and Social Care capital funding for Foundation Trusts – as it can already do for NHS trusts.

NHS England’s new power is intended to be used on a Foundation Trust “where there is a clear risk of an Integrated Care Board breaching their system capital envelope as a result of non-cooperation by a Foundation Trust, and other ways of resolution have been unsuccessful.”

This new power would enable the quango to set a capital spending limit on an individual, named FT for a specified period (typically a financial year), and the limit would automatically cease at the end of that period.

But Foundation Trusts will their retain freedoms around commercial borrowing or reinvesting their surpluses. Info here.

With this Integrated Care Board/ system capital control on the close horizon, it’s not surprising that the consequence is that Foundation Trusts are seeking private funding for essential capital investments.

NHS England has driven privatisation of diagnostics since 2015

NHS England’s privatisation of diagnostic services seems to have started in 2015, in line with the 2015 Comprehensive Spending Review and its requirement of long term partnerships between the NHS and the private sector to support the upgrade of diagnostics capabilities.

That year, the quango selected a Collaborative Network, led by Alliance Medical Ltd, to provide PET/CT scanning services across 30 locations in England.

When challenged about putting all PET scanner services out to tender across the South East, NHS England gave the feeble excuse that EU competition regulations required them to do this (which was not the case) and said that proposed NHS primary legislation to repeal s75 of the 2012 Health and Social Care Act would remove that requirement.

The Health and Care Bill now aims to carry out that repeal, but there’s no sign that this will result in an end to the privatisation of NHS diagnostics.

Privatised Community Diagnostic Centres were announced in 2019 by NHS England as part of the NHS Long Term Plan.

Stripping diagnostic services out of hospitals is part of the slide into further cuts cuts and centralisation of NHS District General Hospitals that is key to the Integrated Care Systems.

In 2019 the NHS Supply Chain Framework Agreement for Mobile and Strategic Clinical Solutions and Associated Goods was launched.

In November 2020, a report on Diagnostics Recovery and Renewal recommended additional actions as well as a new diagnostics model, where diagnostic hubs should be established away from acute hospital sites and kept as clear of Covid-19 as possible.

Case Study in privatisation of diagnostics : Community Diagnostic Centres

In line with this new diagnostics model, it was recently announced that early in 2022 a mobile Community Diagnostic Centre will be operating in Gonerby Road Health Clinic, Grantham – not at the Grantham District General Hospital.

Government spin, recycled in a JP Media piece, is that 40 of these diagnostics hubs are being set up around the country, to help tackle the diagnostic backlog due to Covid and keep people away from the hospitals as much as possible to avoid transmission.

In July 2021, NHS England invited tenders for a 5 year, £10,000,000,000.00  Framework Agreement to provide Community Diagnostic Hubs. Clinical Commissioning Groups and hospital Trusts can award contracts or sub-contracts to companies in the Framework Agreement, for a range of clinical services to be provided from community diagnostic hubs. 

Vanguard Healthcare Solutions is an approved supplier on the NHS Supply Chain Framework Agreement for Mobile and Strategic Clinical Solutions and Associated Goods.

It also provides Community Diagnostic Hubs.

We have asked United Lincolnshire Hospital Trust who is providing the Gonerby Community Diagnostic Centre and will update this blog post with the information, when they tell us.

Update: 27.3.22

Caroline Molloy recently reported in Our NHS on a big discrepancy between the facts and Sajid Javid’s announcement in the House of Commons on 8th Feb 2022 that

“Sixty-nine community diagnostic centres are already up and running, and the plan shows our intention to have at least 100 in local communities and on high streets over the next three years.”

Caroline’s thorough questioning of the Department of Health and Social Care and NHS England uncovered only 17 sites that openDemocracy could confirm had been set up. Most appeared to have extensive private involvement.

At least one – the Somerset NHS Foundation Trust’s Community Diagnostic Centre in Taunton, provided by Rutherford Diagnostics in partnership with private equity firm Equitix – has links with a Tory donor. Reade Griffiths, a director of Equitix’s parent company Tetragon, gave £50K to the Tory Party’s 2017 General Election campaign.


“In at least one case, the answer given contradicted publicly available information. At Brighton Football Ground, a high-profile CDC repeatedly referred to by Javid, local NHS commissioners told us the services were “NHS services and NHS provision” – but, according to the Care Quality Commission, the site is run by Medical Imaging Partnership, which says the same on its own website.”

The ‘Our NHS’ piece added that,

“Another centre, in a business park in Oxford, is provided by US firm Perspectum.

“Other companies involved in, or planned to be involved in, other centres on the NHS list, include Practice Plus (formerly Care UK), HCRG (formerly Virgin Care), Health Share, Cobalt Health, Medneo, GP Primary, Remedy Healthcare, Partnering Health/PHL, Central Surrey Health, Living Well, Physiological Measurements Limited/PML, Endocare and Imaging Matters.

“But private firms’ move into running these units, rather than just building their kit, means the sector stands to gain even more from the £10bn in government cash that has been committed to the CDCs initiative.

“What’s going on isn’t partnership, but parasitism – sucking billions of pounds out of the NHS.”

One comment

  1. […] No wonder then, that a November 2021 poll commissioned by Open Democracy found that UK voters are seriously worried that greater use of private companies by the NHS could lead to a decline in standards and a loss of money to NHS hospitals. But this seems to be precisely what the government is set on. […]


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