NHS Professionals Ltd

Thursday 17th November 2016 Written Statements

[The Minister of State, Department of Health (Mr Philip Dunne)]

My noble Friend the Parliamentary Under-Secretary of State for Health (Lord Prior of Brampton) has made the following written statement:

I am today updating the House on the future of NHS Professionals Ltd (“the Company”).

The Company was set up as a limited company fully owned by the Secretary of State for Health in 2010. While it is the largest single supplier of flexible staffing to the national health service, with a bank of over 90,000 workers providing more than 2 million shifts every year, it currently works with only around a quarter of NHS trusts.

The Department of Health has therefore concluded that the Company requires significant investment to enable it to expand, so it can deliver improved services to even more NHS trusts and reduce their reliance on expensive agency staff—the bill for which is currently £3 billion annually, which diverts resources that could be better used for substantive staffing and improved patient care.

At the moment the Company works with 55 NHS trusts. As the largest provider of bank staff to the NHS, the Company is in a prime position to respond to the NHS’s need for more cost-effective and better planned temporary staffing. It currently saves the NHS approximately £70 million a year by supplying bank staff to hospitals which are more affordable than those staff supplied by expensive agencies. We want to see the Company take advantage of this opportunity to expand its business, acting as a true alternative to expensive agencies. But the Company cannot do this without substantial investment to improve the services it offers.

Over the last year the Department has therefore been exploring a range of potential options to help the Company drive further value for the NHS.

Today I can announce that, following market analysis and a thorough appraisal of a business case, the Department’s preferred option is to create a joint venture partnership to bring in the necessary investment and expertise to the business and give the Company greater operational autonomy. The Department will sell a majority shareholding so that the Company is run and controlled by the new partner, which will carry the majority of the finance and operating risks of the business.

Contractual mechanisms will be used to ensure that the dual aims of creating a profitable business model while meeting the needs of NHS customers—delivering savings and a high-quality service—are correctly aligned and fully agreed upon.

The Department’s retention of a minority shareholding will also ensure there are no significant changes to the agreed purpose and/or objectives of the Company. This is backed up by the right to take back ownership of the Company in the event of any serious breach of the agreed main objectives.

A tendering process to find the right partner is being launched through an advert in the Official Journal of the European Union (OJEU). Potential investors will be subject to detailed evaluation to ensure value for money to the Government.

There will be no immediate impact on the approximately 600 corporate staff who are employed by the Company. The Company’s bank workers will also continue to book and work shifts for NHS trusts as usual.

[HCWS265]