Health minister Ben Bradshaw insisted the plan was not to privatise trusts and would only be used to replace chronically underperforming management.
New measures set out in the document Developing the NHS Performance Regime will help to identify failing trusts and bring in new management from other trusts or the private sector.
The report confirms that PCTs will develop scorecards to measure performance and outcomes in GP surgeries. This will be used, along with Healthcare Commission data, to identify failing PCTs.
Ten PCTs were identified as ‘double weak' by the Healthcare Commission in the 2007/8 annual health check.
NHS director of finance David Flory said private companies would be offered financial bonuses for improving underperforming trusts.
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