08.11.12
Red flag
The test-run for greater privatisation of the NHS may have hit a stumbling block today, as the latest NAO report suggests that Circle is over £2m higher in deficit than planned.
Proponents of the plan to save Hinchingbrooke, the hospital that had developed a cumulative deficit of £39m, argue that it is too early to evaluate the success or otherwise of Circle’s management of the franchise.
But it is certainly a key example of how the procurement and franchising process can work, highlighting areas for improvement and notes of caution for any following takeovers.
And £2m is a significant sum of money to be behind schedule on – if the initial plans were really unachievable then this must serve as a warning flag for other trusts and authorities considering privatisation.
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