Question to the Department of Health and Social Care:

To ask Her Majesty's Government what consideration they gave to the tax status of Virgin Care when awarding that company preferred contractor status with the NHS last year.

‘Preferred contractor status’ is not a recognised procurement term. Private sector companies bidding for individual National Health Service contracts have to follow a well-established procurement process which identifies and selects a shortlist of bidders and then a preferred bidder, which is awarded the contract after final due diligence. NHS England have advised that information on NHS contracts entered into by local commissioners is not held centrally.

It will be for the individual NHS organisations to assess the finances of any potential providers. During the procurement process, the finances of potential providers should be tested by finance professionals to assess the financial stability and ability to undertake the services to the required level of the contract. The Department recommends the use of a Standard Selection Questionnaire (first published in September 2016). Under the ‘Grounds for Mandatory Exclusion’, it states that the procuring authority reserves the right to use its discretion to exclude a provider where it can demonstrate by any appropriate means that the provider is in breach of its obligations relating to the non-payment of taxes or social security contributions.

After a contract is awarded to a provider the NHS organisation is under an obligation to oversee the delivery of services and assuming there are no concerns then the contractor will be paid as agreed under the contract. How the contractor manages their financial affairs is a matter for the contractor not the NHS commissioner, unless the commissioner becomes aware that the contractor is acting illegally, not paying taxes as an example, in which case there may be a duty to report this and act appropriately under the terms of the contract.