Government defeats court challenge to framework agreement for supplying locum doctors

The Cabinet Office has defeated a High Court challenge to the way it operates a framework agreement for the supply of locum doctors.

The background to the case of Medicure Ltd v The Minister for the Cabinet Office [2015] EWHC 1854 (TCC) was that in 2012 the Cabinet Office conducted a procurement exercise in respect of a new framework agreement to govern the supply of locum doctors, including temporary staff.

If a supplier was awarded a framework agreement by the Cabinet Office, it could then be asked by customers, such as NHS Trusts, to provide locum doctors pursuant to separate call-off contracts entered into by the supplier and the customer.

Medicure, the claimant, bid but failed to obtain a framework agreement pursuant to that procurement exercise.

Although the company challenged the decision not to award it a framework agreement in correspondence in August 2012, it subsequently accepted the Cabinet Office's decision, and there were no court proceedings.

Medicure was, however, successful in obtaining a framework agreement with the defendant as part of the Avoca consortium.

Mr Justice Coulson, who heard the case in the Technology and Construction Court, said it appeared that, as a result of what the claimant called "extensive problems" internally within that consortium ("which were nothing whatsoever to do with the defendant"), Medicure had not been called upon by NHS Trusts or other contracting authorities to supply locum doctors under that framework agreement.

In the legal proceedings Medicure complained that, as a result of information that it had obtained as part of the Avoca consortium, the Cabinet Office was operating the framework agreement in a way that was materially different to that which was represented at the time of the procurement exercise.

However, Mr Justice Coulson rejected the claimant’s case, saying it failed “at every level”.

The High Court judge said: “The basic assumption that underpinned it, namely that all of the original documentation, including the Framework Agreement itself, prohibited ad-hoc or direct supply, was simply wrong.

“Direct supply was always envisaged, along with the management of a supply chain in appropriate circumstances. The claimant's bid was rejected because of their very low scores, and only one element of the scoring criteria had anything to do with the management of a supply chain. Subsequently, it is plain that the claimant's difficulties have arisen, not because of the defendant's conduct, but because of problems within the Avoca consortium.”

Mr Justice Coulson said that he had some sympathy with the claimant’s position. “They had successfully supplied the NHS with locum doctors for 18 years. The new Framework Agreement seems to favour larger organisations…. and it legitimately raised a question about the management of a supply chain which the claimant was always going to struggle to answer satisfactorily. All of that appears to have made it difficult for a smaller organisation, like the claimant, to compete for this FA [framework agreement].”

The judge also accepted that, although direct supply was always envisaged as a possibility by the framework agreement, it might “now be receiving greater emphasis than was expected because, in truth, direct supply (rather than the management of a supply chain) was always what the customers wanted”.

“So although the NHS has been involved in a lengthy and doubtless expensive new procurement exercise, it may be an open question as to whether it has actually improved the supply of locum doctors, let alone saved the public money,” Mr Justice Coulson said.

“However, none of that is ultimately of any assistance to the claimant in these proceedings. The tender process was neither unfair nor lacking in transparency. Both the tender process and the FA have been properly and fairly operated. The claimant's claim is therefore dismissed.”