Gloucestershire NHS has reportedly agreed to delay the proposed transfer of primary health services and 3,000 staff to a community interest company after local campaigners threatened legal action.

In an eleventh-hour legal challenge, the campaign group Stroud Against the Cuts has issued a ‘letter before claim’ to the NHS management warning that it plans to seek a judicial review of the decision to farm out local Primary Care Trust services.

NHS Gloucestershire had awarded a contract to deliver primary and community care services, including nine hospitals, to Gloucestershire Care Services, creating the largest Community Interest Company in the UK. No competitive tendering process took place.

The contract, reportedly worth around £100m a year for three years, was due to start on 1 October but according to the campaigners, the NHS has now agreed to delay it while it takes legal advice on its position.

First example

Campaign co-ordinator James Beecham told civilsociety.co.uk: “We believe this is the first example where a social enterprise has got this far and been halted by a legal challenge.

"The current state of play is that the transfer is off while NHS Gloucestershire management assess their legal position.

"In the meantime they have given us an absolute guarantee that they won't transfer anyone or anything out of the NHS without giving us three days clear notice."

NHS would not confirm delay

However, NHS Gloucestershire refused to confirm or deny this was true, only saying that it was still assessing the legal situation. In a statement, its chief executive Jan Stubbings said: “We are responding to the correspondence received.

"In deciding on the future management of our community services to meet local needs and circumstances, we have followed all applicable policy and guidance.  

"Through this process, we believe we have identified the most appropriate solution for the future. We now have a clear direction with the majority of our community health services becoming part of a social enterprise – working in the community interest and for the social good.   

"With a membership model, the new organisation will give staff and service users a stronger voice on how services are run for the benefit of local communities."

Lawsuit on behalf of service-user

The action is being brought by local resident Michael Lloyd, a user of the PCT’s services, with backing from Stroud Against Cuts.  Lloyd’s costs are covered by legal aid but the campaign group is fundraising to cover the community element of the lawsuit.

The campaigners want the services to remain in public hands, fearing that contracting them out is the first step to NHS privatisation.

Contract 'unlawful'

Caroline Molloy of Stroud Against the Cuts said: “We have been advised that NHS Gloucestershire is acting unlawfully. It cannot just hand over all its NHS Primary Care Trust services to an unaccountable social enterprise or community interest company.

“It must either keep the NHS services itself, or have a proper process that would allow services to be provided by another NHS body. Both these options would keep our health services in the NHS, and accountable to the public.”

Lloyd’s solicitor, Rosa Curling of Leigh Day & Co, added: “If the PCT intends to enter into arrangements with a community interest company, it is first required in law to go through a process which allows other economic operators the opportunity of being awarded those contracts.

“No such opportunity has been given and the attempt by the PCT to enter into a contract with a company outside the NHS, in such circumstances, constitutes an unlawful procurement process.”

The campaign brought hundreds of people out onto the streets of Stroud last weekend in protest at the plans (pictured).

Yesterday Stroud District Council hosted a heated ‘extraordinary meeting’ on the issue and passed a motion calling on the local Health Community and Care Scrutiny Committee to examine the proposed move.

Library campaigners in High Court

A separate campaign in Gloucestershire aimed at saving local libraries was being heard in the High Court this week. A local resident backed by the Friends of Gloucestershire Library has brought a judicial review of the county council’s cuts to library services on three grounds: that the council had failed to consult, failed to measure the social impact, and that the move breached the Libraries Act.  The case is expected to finish tomorrow.