Evaluation of NHS procurement spending during the pandemic – a summary of post event assurance activity

This Briefing Note provides a summary of the NHS Counter Fraud Authority (NHSCFA) report issued on 15th August 2022: An evaluation of NHS procurement spending during the COVID-19 pandemic – A report on post event assurance activity.

Key Points

In line with the government programme of work to scrutinise centralised spending, the Health Sector Counter Fraud Board tasked NHSCFA to lead a post event assurance (PEA) exercise on local NHS healthcare spending during the pandemic response. Based on assessment of NHS organisations’ performance in response to three Procurement Policy Notes (PPNs) issued early in the pandemic, the NHSCFA opinion is that despite the mounting operational pressures, the vast majority of NHS organisations maintained good levels of financial governance, assurance, transparency, and fraud risk management for the periods examined as part of the Covid-19 PEA. There were a small number of instances where performance could be improved. The NHSCFA also identified proactive activity at a local NHS organisational level that was taken to avoid risks when taking on new suppliers, and savings of £10m were identified by the NHSCFA.

Notable areas of good practice

The vast majority of NHS organisations maintained good record keeping as stipulated within the direct award and supplier relief payments guidance.

Notable areas of improvement

Two key themes were identified to have shifted the ability to mitigate fraud risk in procurement activity: routes to market and management of contracts. The urgency posed by the pandemic forced NHS organisations to accept new additional risks in the form of new overseas procurement routes, use of multiple intermediaries and inflated prices. The PEA exposed a lack of centralised support and coordination for NHS organisations in sourcing and procuring ventilators and medical clothing. There is further opportunity for all NHS organisations to ensure there are adequate provisions to record evidence of decisions in respect of supplier relief payments and direct awards, and staff to record risk assessments relating to contractual activity e.g. standard operating procedures and a contract management software platform. The NHSCFA identified that the low level of due diligence undertaken on new suppliers was concerning. When no due diligence is undertaken, the contracting organisation is accepting a higher level of risk, although the emergency management situation was acknowledged.

(Briefing note compiled from source material)

Action Required:

Audit Committees and Boards to note the summarised findings from the NHSCFA PEA report.