Representing estates and facilities professionals operating within the  



Getting a better deal for the NHS

The Health Services Journal today (January 11) reports on talks taking place between leaders of several NHS Trusts to establish an alternative to PFI for the NHS. The aim would be to deliver “off balance sheet” capital projects.


In an interview with the Health Services Journal Jim Mackey, Chief Executive of Northumbria Healthcare Foundation Trust and former Chief Executive of NHS Improvement, details an alternative way of securing private financing for NHS projects, which is under discussion by several NHS Trusts.


Controversy around PFI contracts has continued to rumble with feelings running high that private companies are generating so much profit from the NHS at a time when it is suffering such a severe funding shortfall.


In August 2017 the Centre for Health and the Public Interest published a report in which it stated that between 2010 and 2015 the NHS and local authorities in England spent £10.7 billion on hospitals and other healthcare facilities built under PFIs. Whilst the capital value of assets built is £12.4 billion, over the course of the life of the contracts the NHS will pay in the region of £80.8 billion to PFI companies for the use of these assets.


The report further stated that the PFI companies holding the NHS hospital contracts have made £831 million in pre-tax profit over the past six years (data from 107 of the 125 PFI schemes where financial information was accessible). If this £831 million had been routed instead to patient care, the cumulative deficit of all NHS hospitals over the period covered by the study (£3.4 billion) would have been reduced by just under a quarter.


In October 2017 the Nuffield Trust further analysed the cost of PFI contracts to the NHS. John Appleby reported that in 2017 PFI repayments would cost around £2.1 billion and they are expected to peak in 2029, starting to fall in 2049 as older schemes come to an end. 


Appleby’s conclusion was that although not all PFIs represent poor value for money the days of PFI as a means of financing capital schemes in the NHS are probably numbered.


But what is the alternative?



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