Circle Partnership was created in 2004 by merchant banker Ali Parsa and Massoud Fouladi to exploit the newly created market in NHS care. In November 2011 it become the first private company to run an NHS hospital, Cambridgeshire's Hinchingbrooke Healthcare Trust.
Circle describes itself as a “social enterprise”, but since it is mostly owned by private equity companies that aim to make a profit, that stretches the term beyond credibility. Circle also claims to be a "mutual", but unlike mutuals such as John Lewis, most staff cannot stand for and be elected to the board. Circle's private hospitals belong to a separate company owned by Ali Parsa, so even if the “mutual” aspect were true, the employees would own no assets.
Circle has never made a profit. Its Nottingham NHS treatment centre generates a surplus, but this is swallowed up by the huge losses at its private hospital in Bath. Indeed, it appears that Circle is using surpluses on its NHS work to subsidise its private patients (see pdf, p12).
The company uses offshore tax havens like the British Virgin Islands and Jersey to avoid paying tax. In June 2012 Circle admitted that its finances were in such a poor state that it asked for a £47m bailout from shareholders, warning that otherwise the company would be insolvent.
Circle is nominated for:
Using shadowy finance arrangements to avoid tax
(Source: Circle Holdings Annual Report 2011, Circle Holdings EGM notice 2012, Guardian 17/3/12, Corporate Watch 17/3/12)
Misleading the public on its dire financial state, including Ali Parsa's broadcast claims that Hinchingbrooke would break even by the end of 2012, contradicting its own finance reports.
(Source: False Economy 1/8/12, Health Service Journal 2/8/12, Bureau of Investigative Journalism 6/6/12)
Cosy connections with government. Former communications chief Christina Lineen became a special adviser to Andrew Lansley, Tory MP Mark Simmonds is a paid "strategic adviser", and another former comms chief, Nick Seddon, is deputy director of pro-privatisation think tank Reform.
(Source: Guardian 23/9/12, BBC News 21/2/12, OpenDemocracy 20/9/12, Social Investigations 9/8/12)
Donations of more than £1.4m to the Conservatives by Circle shareholders.
(Source: Mirror 29/9/12)
Falsely claiming it is a social enterprise and mutual.
(Source: Guardian 20/1/12, Observer 13/11/11)
Taking the first £2m of any surplus it achieves at Hinchingbrooke as profit, rather than paying off the hospital's debt or investing it in better care.
(Source: BBC News 3/5/12, Daily Mail 3/5/12, Public Service 3/5/12)