NHS IT chiefs to lose control of local contracts

Tony Collins & James Rogers

Wednesday 19 March 2003 10:08

Small group of local service providers to take over service contracts and procurement from trusts.

Local NHS IT managers will gradually relinquish control of IT service contracts and buying decisions as part of the Department of Health's programme to update health service computing.

In a move that has angered some NHS IT professionals, the Department of Health has declared it wants new contracts signed by hospitals and trusts to be capable of "novation". This means the contracts can be transferred to a small number of local service providers or consortia of companies, which are due to be chosen by open tender in the next few months.

Furthermore, trusts, hospitals and GP surgeries could lose direct control over IT contracts to local service providers. These will be private sector consortia such as IBM and Atos KPMG Consulting, which have said they will submit a joint bid to become local service providers.

Some NHS IT directors believe the plan will enable the Department of Health to migrate legacy systems to new applications or allow them to be phased out in favour of those supplied by local service providers and their IT subcontractors. This could lead to a degree of standardisation of systems within the NHS.

Others said the novation of contracts would add extra layers of commercial and legal complexity to existing contracts and could sideline technologically advanced hospital systems that are delivering benefits to patients and have already cost the health service billions of pounds.

An IT manager in a southern NHS trust said, "There is grave concern that we are going to lose control and possibly have things forced upon us. This could cause a loss of knowledge and some IT managers may even leave the NHS."

Health service IT experts were also concerned at the move. Glyn Hayes, chairman of the BCS Health Informatics Committee, said, "I do have a significant anxiety about the loss of what has currently been achieved in the NHS. There's a lot of expertise and knowledge in the NHS already.

"There are some areas of excellence where care of patients is fundamentally tied in with information systems. If these are changed to systems that don't have the same functionality it could affect patient care.

"The knowledge of how healthcare and IT interact, rests with IT managers and health informaticians. If they are sidelined then there is a risk that those coming in to do the job do not understand the environment.

"This is a different IT environment to all others. It involves safety-critical systems and strong ethical and confidentiality issues," Hayes said.

The plans for possible novation of contracts were alluded to in January by the Department of Health in its National Programme for IT in the NHS document, which said that local service providers will be awarded contracts that include the "integration or replacement of existing systems to conform to national standards and support national services".

However, IT directors say they have received little specific information about the department's plans. They are unclear, for example, which of their contracts are due to be transferred to local service providers.

The Department of Health said plans for migrating existing systems have yet to be finalised. A spokesman said its plans would allow some IT to be rationalised and bring net savings.

"The provision of effective and holistic contracting arrangements for a major organisation is generally recognised as a means of ensuring net savings and reductions in unit costs," she said.

The department would not comment on the legal and administrative costs of moving supplier contracts to a new client. "The normal commercial considerations will apply to ensuring value for money and taking into account the period of time remaining in the existing contracts," it said.