Helping South West London identify solutions to contract under-performance

At a glance

Service: Commercial Delivery

Project: Independent facilities management contract review

Customer: South West London Procurement Partnership

Delivery: Six-week multidisciplinary review

Focus: Contract performance, cost pressures, scope creep and future procurement

Key benefits: Greater visibility of contract issues, options to control expenditure, short-term cost avoidance and lessons for future procurements

The challenge

South West London Procurement Partnership (SWLPP) approached NHS LPP about an existing facilities management contract that was experiencing increasing cost pressures. The team wanted an independent view of the contract to understand: 

• how the contract compares to current best practice standards
• which areas of the contract correlated with current performance issues
• what options were available to make changes to the existing contract, and
• lessons that can be learned for future procurements to achieve more robust contractual terms

Our approach

NHS LPP worked collaboratively with the team at SWLPP, to get a full understanding of the contract, how it was performing and any challenges that were being experienced. The SWLPP team proactively and transparently shared both contractual documentation and service insights in order to allow a robust and thorough contract review, in line with agreed assessment criteria based on the Model Services Contract (MSC) - a standardised services contract template for UK public sector bodies. 

Once all the contractual documentation and contextual data was made available, the NHS LPP team conducted the contract review over a period of six weeks. This included the creation of an outcome report which was presented as part of a collaborative debrief by the NHS LPP team, to share their findings but also to discuss the recommendations and learnings for future contracts. 

The impact

The contract review identified several issues associated with the delivery of the contract but also highlighted the mechanisms within the contract available to manage change and control expenditure. 

Suggestions were identified for management of the existing contract in the short-term, including changes through appropriate change control. Further recommendations relating to future procurement activity were also pinpointed. 

The review identified expenditure issues relating to scope creep, and the report has highlighted specific tools within the contract that SWLPP can utilise to minimise further unnecessary expenditure.

The overall outputs of this report have given SWLPP a greater understanding of the contract and the rationale for the financial pressures that were being experienced. This information will inform their strategy for contract management to rectify this going forward, delivering cost-avoidance in the short-term and potential cashable savings through re-procurement in the longer term.

What the customer said

"With the national focus on contract management and significant value that can be obtained via proper contract management, as well as the pitfalls and cost associated with poor contract management, this is a key area of focus for SWLPP.

When offered support from NHS LPP to undertake a deep dive into one of our contracts we knew it was an opportunity to look at a contract that had caused us challenges and had known issues, we had simply not had the time or capacity to go through in the level of detail required.

They brought a fresh perspective, pulled out the key challenges and highlighted some unknowns which require further review. From this we now have the detail needed to provide an options appraisal to our stakeholders and start to take steps to improve the Contract Management moving forward and reduce the additional cost burden of uncontrolled over-spend. The process was easy and required minimal input from the Trust outside of providing contract detail and background, we will look to replicate this work with other strategic contracts.” 

Catherine Andrews, Deputy Director of Procurement, South West London Procurement Partnership

Why it matters

The collaborative and open working relationship with SWLPP enabled honest discussion to readily identify the areas of concern and consequently tailor the review accordingly, to maximise the benefits of the review. 

This exercise has re-affirmed that the risks relating to contract leakage, as identified by World Commerce & Contracting in 2025, are an important consideration for the NHS as a whole, to ensure that value for money from commercial arrangements can be demonstrated.

Find out more

To find out how our team can work with your organisation to understand how contractual challenges can be overcome and be improved upon, or if you have any general queries, please email gstt.lppcommercialdeliveryteam@nhs.net.