NHS Supply Chain’s effort to award a multi-billion-pound logistics contract has been delayed by more legal challenges, writes HSJ.
The national procurement body wants to award a contract for at least seven years, and potentially up to nearly 12 years, worth £4.4bn to run its logistics service to the US firm GXO, but two legal challenges from unsuccessful bidders have been lodged.
There were four bidders for the contract, which first went out to market in June 2023: GXO, DHL Supply Chain, Wincanton and incumbent supplier Unipart.
All four were told at the end of October that GXO was the preferred bidder, according to a legal claim made by Unipart.
The award notice started a standstill period when unsuccessful suppliers could mount a legal challenge.
Two claims were subsequently filed at the High Court: one by Unipart on 11 November and the second by DHL on 28 November, which triggered an automatic suspension of the procurement process.
NHSSC, as defendant, can apply to have the suspension lifted by a judge so that it can proceed with awarding the contract to GXO while the legal challenges continue. However, HSJ understands that NHSSC may not be able to get a hearing before a judge until early 2025.
The current contract was due to expire in 2024. The incumbent Unipart will continue to provide the logistics service until a new contract is agreed.
Successive legal challenges There have now been four challenges brought during the process, including two from Unipart, which had a previous claim in April 2024 contesting the decision to exclude it from the shortlist.
Its latest challenge largely reiterates the first claim, which said there were errors in how NHSSC evaluated and scored its bid, resulting in it being unlawfully excluded from the shortlist stage.
The November claim adds that NHSSC broke procurement rules by not including information on the reasons for its decision to award to GXO in the contract award notice sent to bidders at the end of October. It will apply for this second claim “to be consolidated, or alternatively heard together with the first claim”.
NHSSC has yet to file its defence to the second claim. However, it said in defence of the first claim: “[Unipart’s] claim is a paradigm example of a misconceived attempt to undertake an expansive review and re-mark of the scores given for subjective reasons of disagreement.”
Details of DHL’s claim have not yet been made public through the court. The fourth challenge was brought by Wincanton, also in April this year, in response to being excluded from the second round of the process.
Wincanton argued the way NHSSC scored its bid was unlawful and that its evaluation had been carried out in such a way as to help certain, but unnamed, bidders make the shortlist for the final stage of the procurement.
NHSSC denied it had carried out the evaluation to favour specific bidders but did admit its evaluation of Wincanton’s response to a specific technical question had been unlawful. It said its decision to exclude the firm should be set aside and it should be allowed to move forward to the next stage.
Wincanton rejected this offer in further court filings, saying it had been denied the chance to compete for the bid, having already disbanded its bid team by the time the NHSSC defence was filed.
In response to questions about the DHL claim and second Unipart claim, an NHSSC spokesperson said: “We don’t comment on ongoing legal proceedings but can confirm that we have received challenges, which have the effect of automatically suspending our right to sign a contract and, accordingly, announcing the identity of the winning bidder.”
A Unipart spokesperson told HSJ it could confirm legal proceedings continue over the tender process against Supply Chain Coordination Limited, the legal entity through which NHSSC operates, but noted: “We are unable to share any further information until legal proceedings have been concluded. Unipart is committed to supporting our people to continue to deliver the best level of service to the NHS Supply Chain.”
DHL Supply Chain and GXO were both approached for comment.
Source: HSJ
Date: 3 Dcember