A BBC story last month claimed the NHS in England faces “a total bill” (over the contracts’ lifetime) of £65 billion for new PFI hospitals, meaning annual repayments take up more than 10% of some Trusts’ turnover.
The BBC added that its figures also revealed that levels of repayments were rising. “In total,” the story said, “the NHS currently pays back £1.25 bn each year – a figure which rises year-on-year until 2030 when it will top £2.3 bn. The final payment will not be made until 2048”. In the face of predicted swingeing public spending cuts, the BBC also quoted Professor John Appleby (pictured), chief economist at the King’s Fund, who apparently said of the PFI system: “It is a bit like taking out a pretty big mortgage in the expectation that your income is going to rise, but the NHS is facing a period where that is not going to happen. Money is being squeezed, and the size of the repayments will make it harder for some to make the savings they need to. I don’t see why the NHS can’t go back to its lenders to renegotiate the deals, just as we would with our own mortgages.” Despite the concerns, a recent National Audit Office study of the performance of English PFI hospital contracts, “The performance and management of hospital PFI contracts” (see report in next month’s HEJ), suggested most of the 70-plus English PFI hospital contracts now operational were “achieving the value for money expected when the contracts were signed”. A Department of Health spokeswoman said the schemes were providing “value for money” and were “affordable”, apparently adding: “One of PFI’s benefits is that the buildings are always contractually required to be kept in good condition; good maintenance will always cost more than not maintaining facilities to a high standard.”
