The NHS has agreed the biggest-ever privatisation of its services in a deal worth up to £780m intended to help hospitals tackle the growing backlogs of patients waiting for surgery and tests.

The deal will see 11 private firms paid by the NHS to carry out heart, joint and other types of operations and perform scans, X-rays and other diagnostic tests on patients.

Under the contract many services will be provided in mobile facilities rather than hospitals. The NHS has been using mobile services for breast screening programmes but the contracts mark a large expansion into other areas of treatment and testing. The system is seen as more patient-friendly but it will also allow the NHS to rapidly buy in services from firms to help meet key waiting times targets.

The deal has been struck by the little-known body called NHS Supply Chain, which helps the health service with procurement. NHS Supply Chain has agreed the scale of the work across the health service and individual NHS trusts will now be able to hire the mobile firms to help clear backlogs.

The contract has raised concern because three of the 11 profit-driven companies involved have been heavily criticised, including two by the NHS regulator, for providing poor quality of care in hospitals and care homes. Labour’s shadow health secretary Andy Burnham said it showed that “chunks” of the NHS were being sold off – but the Department of Health insisted there had been no significant increase in the privatisation of the health service.



Depending on how many hospitals use them, the 11 firms stand to pocket up to £780m over the four years to December 2018. That eclipses the previous record NHS privatisation deal, which saw Virgin Care get a £500m contract in 2012 to provide community services in south-west and north-west Surrey until 2017.



The country has never given its approval for the NHS to be bought and sold in this way Andy Burnham, Labour

A spokesman for the NHS Business Services Authority, which oversees NHS Supply Chain, said the deal broke down to five national contracts with a maximum value of £240m, £160m, £240m, £80m and £60m – adding up to a total of £780m.



“This framework was introduced to provide a central point from which mobile and strategic clinical services could be procured efficiently within the NHS. NHS organisations can choose to utilise this route to market if needed saving time, and resource, from not having to undertake formal public procurement locally”, the spokesman said.

Burnham said: “It is outrageous that large chunks of the NHS are being parcelled up and sold off without the permission of a single person in this country.”

“Jeremy Hunt tries to claim that ‘privatisation isn’t happening’, but the truth is it is happening at speed and scale,” he added. “This now needs to become an election issue. The country has never given its approval for the NHS to be bought and sold in this way. This sounds like a race to the bottom. It’s clear that quality is not the deciding factor when people with poor care records are winning the contracts.”

It’s nonsense to suggest that this contract means significant outsourcing of clinical services Department of Health

A Department of Health spokesman said: “It’s nonsense to suggest that this contract means significant outsourcing of clinical services. Use of the private sector in the NHS represents only 6% of the total NHS budget – an increase of just 1.7% since May 2010. Charities, social enterprises and other providers continue to play an important role for the NHS as they have done for many years and the NHS should hold providers to account if they do not meet the high standards of care that patients expect.” It declined to comment on the three companies that have been criticised for poor care winning fresh NHS contracts to treat patients.

The companies include several that have previously held controversial contracts with the NHS. Vanguard was the sole winner of a contract worth up to £160m to help NHS trusts undertake surgical procedures in mobile operating theatres. It is facing legal action over a series of eye operations carried out in 2014 at Musgrove Park Hospital in Somerset. A confidential NHS report into Vanguard said the operations appeared “rushed” and surgeons were allowed to continue even after patients reported serious complications. The hospital terminated its contract with Vanguard after just four days as a result of the problems.

A second firm, Circle, is in line to share up to £240m for providing imaging services, such as scans and X-rays. It will also provide services within operating theatres. Circle is the firm which pulled out of running Hinchingbrooke hospital in Cambridgeshire – the first private firm to manage an NHS hospital – following the publication of a damning Care Quality Commission (CQC) report into the quality of care patients were receiving at Hinchingbrooke.

Despite ministerial denials, this is yet more proof that privatisation is an everyday reality in the NHS NHS Support Federation

A third company involved in the deal, Care UK, was criticised by the CQC for the quality of care at two nursing homes it runs in Suffolk.



Paul Evans of the NHS Support Federation, which tracks outsourcing of NHS services and campaigns against privatisation, said: “How can the public have trust in companies that have so recently been the subject of such damning criticism? We already have many examples where patients have suffered because of the way that health firms are providing care to the NHS. It is time to step away from healthcare through the market”.

“Despite ministerial denials, this is yet more proof that privatisation is an everyday reality in the NHS. The scale of contracts is increasing as companies are seizing the opportunity to bid to run a huge range of NHS services,” Evans added.