NHS watchdog expresses vendor lock-in concerns over Federated Data Platform deal

Quango must show Palantir does not have unfair advantage in procurement

England's health data watchdog has warned the government quango in charge of the country's health service that it must show how it will avoid vendor lock-in in the forthcoming £480 million ($604 million) deal for a Federated Data Platform (FDP).

The controversial deal, set to be awarded this autumn, has attracted criticism over its lack of openness and the apparent advantage it offers incumbent supplier Palantir, the US spy-tech firm.

The National Data Guardian (NDG), a government patient confidentiality watchdog, has now warned against locking the NHS into to the winning bidder – with commercial and operational consequences – as well as giving Palantir an unfair advantage.

In a blog post published late last week, Dr Nicola Byrne said NHS England, the non-departmental government body leading the procurement, needs to "provide information on how the incumbent supplier advantage has been mitigated" in order to show that the competition has been fair.

NHS England first started working with the US analytics company during the height of the pandemic, when a £1 award [PDF] led to a £1 million ($1.7 million) deal, and then a £23 million ($29.2 million) contract signed in December 2020 without competition for a COVID-linked data store and related analytics.

That deal was subject to the threat of judicial review from campaigners who argued the contract represented such a change in data usage it warranted public consultation under British data protection law. NHS England later agreed not to extend Palantir's contract beyond the pandemic without consulting the public.

In January, NHS England extended that deal by six months for a value of £11.5 million ($14.64 million), the maximum 50 percent value extension allowed without competition under UK public procurement law. It also launched the formal FDP procurement that month. In June, it awarded Palantir a £24.9 million ($31.7 million) deal to cover the one-year transition, from June 12, 2023, to the new FDP.

The government has said the new data store would provide NHS operational and population health analytics. It argues the FDP will be vital to the health system's post-COVID recovery and reform the NHS – one of the world's largest health providers.

The NDG said the public will want assurance that the NHS will not be locked into a single supplier once the deal, set to last up to seven years, is awarded.

"We have also heard concerns about vendor lock-in," Byrne said in her blog. "Longer-term, people want to understand the arrangements in place to ensure the NHS does not find itself locked into a relationship with any specific vendor. The consequences of which can include rising costs, no redress against inadequate performance, and prohibitive charges for changes. People want to be assured that the NHS will maintain control and that its own workforce will continue to upskill in digital, data and technology. And that it can terminate the partnership as and when necessary, without compromising patient care or incurring significant costs."

The NDG said she had been speaking with and advising the government and NHS leaders about the about the FDP procurement since first writing about the topic in November last year.

"Members of the public, healthcare professionals, journalists, MPs and campaign groups all continue to raise concerns about ethics, privacy, its likelihood of success, procurement, and cost. Some of these concerns have arisen because public discourse about one of the potential commercial suppliers, Palantir, has been particularly contentious," she said.

Byrne called on the government and the NHS to show the likely – not simply hoped for – value to patients and the NHS; demonstrate the integrity of the decision-making process; and provide credible assurance about the relationship with the supplier. The NDG has no investigatory or enforcement powers, although it can work closely with Information Commissioner's Office, which does.

NHS England chief data officer Ming Tang said: "The National Data Guardian has provided much-appreciated support and wisdom throughout the development of the Federated Data Platform, and we will continue to work closely with her and others in ensuring this vital tool is delivered with the confidence of both colleagues and the public.

"As part of this, over the past 18 months we have engaged with patients and the public, NHS staff and leaders, as well as experts from across data science, cyber, privacy and security, and remain committed to ensuring their voices are central to ongoing planning and implementation." ®

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