NHS trust paid £75,000 fee to 'phantom' firm

In the annals of the NHS and its growing privatisation, the strange tale of the NHS trust and the phantom managment consultancy may rank among the oddest.

NHS Lothian in the Scottish Borders paid £75,000 to a consultancy firm for it to find private hospitals that would help cut the trust's long NHS waiting lists.

But, after the Scottish Health Secretary Nicola Sturgeon ordered an inquiry following allegations that the contract had been awarded improperly, the consultancy firm, HD Partners, apparently disappeared.

On its website, HD Partners lists offices in London, Frankfurt, Madrid and other European cities.

But when The Independent called the telephone numbers given it got a BT recorded message at the London headquarters saying that there was no subscriber.

In Frankfurt, the number given was a translation company and in Madrid an IT company. Neither had heard of HD Partners.

The firm was awarded the contract last October following the discovery that the NHS Lothian trust had been massaging its waiting lists to make them look better than they were.

An independent report in February found that patients were being referred for treatment in England but given unrealistic appointments that they could not keep.

When they declined, they were wiped from the waiting list so the trust did not breach its 18-week target. Two members of staff were suspended.

In March, Professor James Barbour, the chief executive of NHS Lothian, retired after a decade in the job. The trust had been criticised by the Health Secretary over the waiting-list debacle.

Ms Sturgeon has since demanded that the trust explain how the contract came to be awarded to HD Partners and is seeking assurances it was placed in an "open and transparent" manner.

Last week Professor Barbour denied claims that the deal with HD Partners had wasted money when the job of negotiating with private hospitals to take NHS patients could have been done by the trust itself.

He has told a Scottish newspaper that the deal saved the trust £500,000 because the firm had been able to negotiate better deals than would have been available to the trust directly.

"I understand the work they did saved half a million pounds," he said.

And he denied reports that he had gone to work for HD Partners.

"I have no contractual arrangement with HD Partners; I do not work for them and have received no payment from them," he said.

A spokesperson for NHS Lothian said: "NHS Lothian employed HD Partners for two pieces of work related to waiting-times management. This amounted to around £75,000. NHS Lothian has no further contracts with HD Partners."

"Details regarding the company concerned are subject to the review requested by the Cabinet Secretary and it is not appropriate for us to speculate until this has been carried out."

Following The Independent's inquiries, the company has updated its website to remove the contact numbers for its London and European offices and replace them with an email address.