Claims of “commercial confidentiality” are being used to prevent public scrutiny of the first contract with a private company to run an NHS hospital. The story of Hinchbrooke hospital shows how under existing rules the new healthcare market created by the Health and Social Care Bill will reduce transparency and accountability in the use of public money. The Bill returns for its final stages in the House of Lords on Monday 19th March but this critical issue has still not been properly debated. The need for financial accountability and transparency was demanded by Liberal Democrats at their 2011 Spring Conference and promised in the February 2012 letter about the Bill from Nick Clegg and Shirley Williams.
In November 2011, the Government announced that Circle Healthcare would be contracted to run Hinchingbrooke hospital, the first NHS hospital to have its management taken over by a private business.  But it is not possible for the public to make a fully informed judgement about the contract, because both the Treasury and Department of Health have refused to release key information, despite requests by academic researchers at Queen Mary, University of London under the Freedom of Information Act [FoI]. 
Both the Treasury and DH have said that a “redacted” version of the Full Business Case for the contract will be published at some unspecified future date, but have refused to release information on the financial models and methodology on which the contract is based. The Government is claiming exemption from the FoI Act under Section 43 of the Act, which deals with commercially sensitive information. The Treasury letter setting out the reasons for this refusal says that “the commercial interests of the NHS and/or Circle” are more important in this case than the public interest in transparency and accountability in the use of public funds.
Ensuring that commercial confidentiality was not used as a reason to prevent public scrutiny of NHS contracts under the legislation was a key demand of the Liberal Democrat Spring Conference in 2011 and the February 2012 letter on amendments to the Bill from Nick Clegg and Shirley Williams stated that “no one should be allowed to spend public money without telling us how they are going to use it. That is why we have insisted that decisions about patient services and taxpayers’ money must be made in an open, transparent and accountable way.” In a letter to all peers dated 22nd December 2011 Earl Howe promised regulations covering healthcare commissioners would to ensure “transparency in the commissioning process”. However, he also wrote that these regulations would be based on the existing Principles and Rules for Co-operation and Competition in the NHS “which we will retain to ensure continuity”. These rules cover the Hinchbrooke hospital contract.
Commenting, Professor Allyson Pollock said:
“It is crucial to ensure proper accountability in the NHS, when in future care will be arranged through tens of thousands of commercial contracts. The Bill as it stands does not ensure transparency and accountability in the use of public money, despite interventions by Mr Clegg and Baroness Williams. Ministers, civil servants, healthcare businesses and managers will be able to claim exemption from Freedom of Information legislation on grounds of commercial confidentiality. The Bill should certainly not proceed until and unless this loophole in ensuring transparency and value for money has been properly plugged.”
Professor Allyson Pollock 07976 978304 email@example.com
Ian Willmore (media) 07887 641344 firstname.lastname@example.org