Posted by: westlancashirerecord | March 19, 2017

Virgin Care v NHS England and Others

Back in December 2016 WLBC  declared “That this Council notes with concern the intention of West Lancashire Clinical Commissioning Group to proceed towards contract with the profit-making company Virgin Care Ltd for the delivery, from April 2017, of both urgent care and community health service, which to this point have been provided on a non-profit basis from within the NHS.

“That this Council is concerned that, over time, health services contracted to a profit-making company such as Virgin Care Ltd may become degraded, with consequent negative effect for the people of West Lancashire, given the inherent conflict of interest between the contractual requirement to deliver services and the primary requirement of a private company to deliver returns to the shareholders of Virgin Care Ltd, which is majority owned by the Virgin Group Ltd conglomerate.

“The Chief Executive be instructed to write to the Chief Executives of both West Lancashire CCG and Virgin Care Ltd, to demand that the contracting process be carried out will full transparency, and with West Lancashire Borough Council afforded full opportunity to consult and make recommendations on the final contract before it is signed by both parties”.

We don’t know if this happened, but we should be told. Because Virgin Care has just this week started a High Court action against NHS bodies and Surrey County Council over a procurement dispute. The company objects to the circumstances in which it lost an £82m three-year contract for children’s health services. It has taken action against NHS England, Surrey County Council and the county’s six clinical commissioning groups after the new contract was instead awarded to Surrey Healthy Children and Families. The latter is a joint vehicle of Surrey and Borders Partnership NHS Foundation Trust and social enterprise Central Surrey Health.

A Virgin Care  spokesperson said “During the feedback from the commissioner we became concerned that there may have been serious flaws in the procurement process leading to an outcome that we strongly feel is not in the best interests of either the children and families we support or our valued colleagues. Having bid on many contracts over the past decade never before have we been so concerned with the whole process that we have needed to make a challenge of this nature. The commissioners have now signed a contract with the new provider and we are disappointed to be saying goodbye to our valued colleagues and the children and families we support. It is our job now to ensure we support a safe transfer on 1 April so the transition is as smooth and seamless as possible for all involved.

Over the past six years, Virgin Care has been awarded numerous NHS contracts and now runs over 200 NHS services, but despite the scale of its involvement the company shows no signs of making a profit. Indeed, according to its accounts, since 2010 the company has recorded an annual loss of £9 to £10 million in the UK. As Virgin Care Ltd makes no profit in the UK, the company pays no tax in the UK. However, Virgin Care Ltd is a small entity in Richard Branson’s Virgin empire. Virgin Care’s parent is Virgin Group Holdings registered in the tax haven of the British Virgin Islands.

The ultimate owners of Virgin Care and Virgin Group Holdings are trusts registered in the British Virgin Islands whose beneficiaries are Richard Branson and his family. The British Virgin Islands are a tax haven and entities registered there pay no tax. As a result of the link with the British Virgin Islands, questions have been raised over whether tax would be paid in the UK if Virgin Care made a profit.

Perhaps Virgin Care had a fit of petulance and might be more interested in its own best interests rather than those of the children and families it won’t be profiting from anymore? It might be a good idea for those who allow companies feeding from the NHS and taxpayers’ trough to insist those companies be wholly registered in England and subject to English taxation? And while Virgin Care takes action as it is doing, the NHS will spend huge sums of our cash in legal fees that should be providing care in our hospitals!

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