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PSO chairman Frazer Barton said his board would make a final decision on Monday on whether to lodge an interim legal injunction over the $5.5 million annual contract.
The PSO group, supported by members of the public, attended the health board meeting in Dunedin, at which speakers appealed to members. A petition was presented with 13,044 signatures.
Yesterday afternoon, board chairman Joe Butterfield issued a statement saying the board was unanimous in its resolve not to revisit the decision, which was the best long-term option for clients.
''[The board] needs to do further work in explaining the reasons for our decision to the public and we will be doing this in an open way as soon as possible. ''We have been reluctant to do this when faced with possible legal action but now believe this is essential regardless of that,'' Mr Butterfield said. PSO and supporters expressed immediate disappointment yesterday morning when they left after the submissions.
Board members were described as appearing to have ''closed minds'' by submitter Dr Keren Skegg.
Mr Barton told members his organisation had been at a disadvantage as it was unable to cite the Southern District Health Board as a referee, because the board was running the process.
The three selected North Island-based organisations, one of which is owned by an Australian organisation, were able to cite health boards as referees as they worked in other areas.
PSO chief executive Gillian Bremner said the transfer process was likely to be ''complete disarray''. Board member Richard Thomson asked why PSO did not raise concerns during initial consultation with providers, to which Mr Barton said PSO had anticipated a fair contractual process.
Chief executive Carole Heatly said it did not matter ''whose name was above the door'', the priority was the clients and service quality.
PSO hoped to partner Disabilities Resource Centre Southland to provide the service in Otago and Southland.