Hospital chiefs have thrown in the towel in a row over a £238m contract.

A five-year multi-million deal to run a host of community health services, dubbed Care Closer To Home, was awarded to health firm Locala.

Locala – a not for profit social enterprise which already runs much of the community nursing in Kirklees – was awarded the deal over Calderdale and Huddersfield NHS Foundation Trust (CHFT) last July.

Missing out on the contract means a loss of income of approximately £5m per year for the infirmary and Calderdale Royal, which are forecast to record a £25m deficit by the end of this year.

Locala offices at Beckside Court in Batley
Locala offices at Beckside Court in Batley

Angry hospital chiefs put in a complaint challenging the decision by Greater Huddersfield and North Kirklees clinical commissioning groups (CCGs), who control the local NHS budget.

A strongly-worded statement from the trust and its partners, Mid Yorkshire Hospital Trust, Forget Me Not Hospice and three GP federations, called for hospital regulator Monitor to investigate.

It said: “As a partnership we do not agree with the decision nor the process undertaken by the CCGs in evaluating and making the decision on the contract.”

But three months on and chief executive of CHFT, Owen Williams, conceded they had given up their challenge.

It means Locala is now free to proceed with transferring some of the hospitals services into its own business.

Some clinical staff will be transferred across to the Batley-based provider. It is unclear if the re-structure will mean any job losses or job gains.

Owen Williams

Mr Williams said: “We have, with our GP partners, reviewed the feedback from Monitor and decided that it is in the best interests of all concerned to move on and ensure we are prepared for winter, continue to address our financial challenges and are well equipped to manage far-reaching service changes.

“Over the last few months the trust has been working with Locala and Greater Huddersfield CCG to ensure continuity of care for our patients and to ensure that our exceptional staff transfer to their new employer as smoothly as possible.”

The Care Closer To Home contract is a scheme designed to deliver more care outside of hospital settings, either in GP surgeries, health centres or in people’s homes.