Sunday, 1 April 2012

NHS procurement didn't consider wider environmental impact

You may recall that in 1992 a container holding 28,000 plastic toys, en route from China, went overboard. Since that time there have been sightings of the washed up 'ducks' all over the world. Indeed Donovan Hohn wrote a book entitled 'Moby-Duck' on the 'duck chaser' phenomena.

However, the House of Commons Environmental Audit Committee's recent report, 'All washed up', has now highlighted that the true owners of the plastic toys are the NHS; the NHS are responsible for environmental costs incurred. The EAC investigation was concerned with the adverse environmental impact and the fact that a number of dead Cotton Tailed Seals had recently been washed up on Scottish shores. Each of the seals had died having choked on plastic toys.

The connection with the NHS procurement was only established during the seal post-mortems when it was discovered  that each of the plastic ducks were stamped 'Property of NHS'. Like me, I suspect you were unaware that a framework arrangement was in place for plastic toys and didn't give a second thought  to how toys, in general, appear in children's hospitals the length and breadth of the country.

Why was the NHS so coy about their ownership of the ducks?  It now appears that little thought had been given to the aggregate expenditure on plastic toys, and that the contract, in aggregate worth £200k,  should have been placed via OJEU. This was not the case and the contract was awarded to Hoo Flung by the NHS in breach of the Public Procurement Regulations.  The NHS therefore preferred not to draw attention to the arrangement. Unfortunately, while the NHS had completed a risk assessment and established the plastic toys were safe for small children, no one, in their wildest dreams, would have thought that the container would have gone overboard and an endangered species would suffer.

A row then took place between DEFRA and DH officials regarding compensation. Bizarrely DEFRA are responsible for the shoreline around the UK and also the preservation of the Cotton Tailed Seal.  It was DEFRA's responsibility to ensure that none of the ducks would have injured the seals but they claim NHS were negligent in their specification, risk assessment and duty of care.

NHS procurement specialists had been checking the contract terms and hoping no more would have been said.  Now the EAC have stepped in and, in addition, questioned the value of the NHS sustainable procurement policy, the wider whole life costs, and, if you excuse the term, the 'duck miles' involved in the procurement.

Lessons for the future:
  • remember the aggregation rules
  • in the event of a breach having been made, avoid ducking the issue 
  • make clear ownership does not pass until receipt of goods
  • if you are responsible for procuring toys consider the potential wider implications and risks
  • consider stamping 'Property of ...' as close to the point of use as possible
  • take out adequate insurance to protect against any claims of gullibility

Background Reading
Donald, D. (2012) 'NHS fooled having neglected duty of care with washed up ducks', The Sunday Times, 1 April, p.74.

1 comment:

  1. I appreciate that this may come as an embarrassment to some but this was an April Fool!