The recognised capability and assurance gap in NHS contract management
The National Audit Office, NHS Counter Fraud Authority and national reviews have consistently identified contract management as a persistent weakness across the NHS and wider public sector. The following articles and reports demonstrate the consequences.
"Contract management is a recognised capability and assurance gap. The National Audit Office has repeatedly found that public bodies fall short of good commercial practice, particularly in capability, data, accountability and post-award supplier oversight. Within the NHS, the NHS Counter Fraud Authority has specifically identified contract management and purchase-order controls as procurement-fraud vulnerability areas, while national reviews have found substantial variation in the prices paid by trusts for equivalent products.
News Articles
The following articles demonstrate the consequences of weak NHS procurement and post-award contract management. Each is paired with the official report or review behind the story.
The Guardian
Vast disparities between what NHS trusts pay for identical products
Substantial differences in what NHS trusts paid for the same products, demonstrating inconsistent pricing, fragmented commercial information and limited comparison between organisations. The problem is argued to be even greater across major contracts awarded independently by individual trusts.
Although older, this reporting remains directly relevant to PayRight's supplier benchmarking function.
PharmaTimes
NHS procurement waste costs £1 billion a year
NHS Shared Business Services estimated that inefficient procurement costs the NHS approximately £1 billion annually. Examples included trusts paying as many as 19 different prices for the same pacemaker and 22 different prices for the same surgical instrument.
A strong demonstration of the longstanding nature of price variation. The statistic is historic and should be dated when used.
The Guardian
PPE worth £1.4bn from one deal destroyed or written off
Approximately £1.4 billion of PPE purchased under a £1.78 billion contract was destroyed or written off, with only a relatively small proportion of items reportedly used. This demonstrates the consequences of weak demand validation, insufficient post-award monitoring and limited ability to detect emerging financial exposure.
This concerns exceptional pandemic procurement and should be used as a major case study, not presented as representative of normal NHS invoice processing.
The Times
'Complacent' NHS chiefs making glacial progress on financial planning
The Public Accounts Committee criticised NHS financial planning and short-term decision-making after the NHS exceeded its £171 billion budget by £1.4 billion in 2023/24. This supports the wider financial-pressure argument facing NHS organisations.
This supports the wider financial-pressure argument but does not prove that invoice overcharging caused the overspend.
The Guardian
Private companies providing NHS services made £1.6bn profit
Private companies generated approximately £1.6 billion in profits from £12 billion of NHS contracts over two years. Critics argued that the NHS was not sufficiently using its purchasing power to secure better value from its supplier relationships.
Supplier profit is not itself evidence of overcharging or contractual non-compliance, but supports a value-for-money and supplier-benchmarking argument.
The Guardian
NHS Palantir contract called into question over value and transparency
Coverage of the £330m NHS Federated Data Platform contract raised concerns about transparency, adoption, supplier dependency and value for money. Only 151 of the targeted 240 NHS organisations had reportedly adopted the platform, demonstrating the continuing importance of monitoring delivery and value after a contract is awarded.
Useful for demonstrating the continuing importance of monitoring delivery and value after a contract is awarded.
The gap is well documented. We help you close it.
Our commercial assurance work is built on the same evidence base that regulators and auditors have identified as a persistent weakness. We help NHS and public sector organisations close it.