PFI And The NHS – A Health Emergency

Report by Health Emergency, Published: 04/03/11
More and more NHS hospitals built at high cost with private finance in the last decade (under the controversial Private Finance Initiative) are already closing beds and axing clinical and other staff in a desperate bid to balance the books as NHS budgets face the biggest-ever squeeze.

And now cuts and closures of services are being combined with asset-stripping sales of land and property to bail out floundering Trust finances.

• The financially-strapped South London Healthcare Trust, which includes two financially-disastrous PFI hospital schemes (Bromley’s Princess Royal University Hospital and the Queen Elizabeth Hospital in Woolwich) has announced plans to flog off “spare“ land assets on several sites. This will virtually dismember what remains of the Queen Mary’s hospital in Sidcup, where A&E and maternity services have already been axed, despite pre-election promises that they would be kept open – killing any last faint hopes of restoring the lost services.
• In West London, the struggling West Middlesex Hospital Trust is planning to axe hundreds of nursing and admin jobs, and close more of the beds in the PFI-funded hospital, seeking to cut spending by 12% in two years.
• In North East London, the £239m Queen’s Hospital in Romford, part of Barking Havering & Redbridge Hospitals Trust, is running with a whole floor unused, while the Trust is still seeking ways to close most of the 18-year old King George’s Hospital in Ilford in order to stem its continued yearly deficits.
• Upwards of 100 beds in the most costly PFI development in the country, the £1 billion Bart’s & London Hospital (where each bed is costing £1m to build, and £5m over the lifetime of the contract) are also to be closed – before they are even built, leaving the Trust saddled with the escalating bill for building capacity it cannot afford to run.
• In Portsmouth too, a brand new £256m 1,200 bed QueenAlexandraHospital has announced 700 job losses and the closure of 100 costly beds in a battle to balance the books. The “unitary charge“ PFI bill, which rises each year, is £43m this year, making the total cost of the hospital and support services under PFI a staggering £1.6 billion.

Many other PFI hospitals are facing financial problems but have yet to announce cuts. But perhaps the financial nonsense of PFI is clearly underlined by the plight of the West Middlesex Hospital, which has already paid out £89m to the consortium which built the £60m hospital, but faces another 20 years or more of payments totalling more than £420m before the £515m contract is complete.

Commenting on the latest revelations, Health Emergency’s Information Director Dr John Lister said: “PFI means that hospitals face rising bills each year – regardless of their income: It also means that private sector profits are protected by legally binding contracts, taking an increased share of declining Trust budgets, while clinical services, patient care and the jobs of NHS staff are sacrificed – in an impossible battle to balance the books as the NHS faces real-terms cuts for the first time in a decade.

“Isn’t it significant that Andrew Lansley’s massive and controversial Health and Social Care Bill is seeking to break up almost every structure in our NHS, claiming to make the system more efficient, but leaving PFI intact, and instead opening even more ways for the private sector to rip off the taxpayer and undermine public services?

“The Tories appeared opportunistically critical of their own PFI policy when Labour was implementing it, but are now happy to see this growing haemorrhage of cash from the NHS.

“If ministers really wanted value for money in the NHS, they would scrap Lansley’s crazy Bill which hardly anyone – even GPs – supports, and which will cost £3 billion or more to implement, and focus instead on nationalising the PFI hospitals, many of which will be paying through the nose for a generation to come to banks that the taxpayer already effectively owns.“