PFI- poor diagnosis for outdated costly, rigid and bureaucratic process
The private finance initiative PFI- "has had its day" as a way of building hospitals, at least in its current form, the NHS Confederation, which represents health authorities and trusts, said yesterday. Following a survey of 13 completed schemes, the confederation said the 30-year contracts were too inflexible to cope with rapidly changing healthcare, particularly as more care was likely to be delivered outside hospitals.
If PFI was to be retained "it needs to be updated", said Sylvia Wyatt, project manager for the confederation's Future Healthcare Network. That could involve shorter contracts that would turn out more expensive as capital was amortised over a shorter period.
Alternatively, approaches closer to Lift, the programme in which the National Health Service has launched joint ventures with the private sector to rebuild primary care and community premises, could be tried.
Under these long-term partnerships, buildings for which there is an immediate need are constructed or refurbished, with others added as the need arises.
The survey showed trusts felt they had benefited from PFI but the negotiating process was costly, bureaucratic and time-consuming and rarely produced good design, while the resulting contracts were too rigid, she said.
Growing numbers were having to be recast in the course of the deal or altered within 18 months or two years of being completed, both of which were costly.
"The big bang solutions don't work very well. It's bad enough trying to predict what the price of fuel will be in 30 years let alone what healthcare will look like.
"The model is 10 years old, and PFI hospitals were built on the assumption healthcare was going to be broadly the same for the next 30 years," she said. With money set to follow the patient, patient choice, and more care being shifted to specialist treatment centres and primary care "that is not now the case".
The criticisms follow warnings from senior health department officials that the NHS was building PFI "monuments" when more flexible buildings are needed.
The private sector was also getting disillusioned, Ms Wyatt said. In the late 1990s there were frequently six bidders to a project. In a number of Scottish cases, and at Whipps Cross in London and Plymouth in Devon there had been only one.
"There is a very real risk that private contractors could walk away from both individual PFI schemes and from major PFI healthcare developments unless the current process is streamlined to reduce the cost, both financially and in terms of time," she said.
http://news.ft.com/cms/s/7bd51674-4819-11da-a949-00000e2511c8.html
If PFI was to be retained "it needs to be updated", said Sylvia Wyatt, project manager for the confederation's Future Healthcare Network. That could involve shorter contracts that would turn out more expensive as capital was amortised over a shorter period.
Alternatively, approaches closer to Lift, the programme in which the National Health Service has launched joint ventures with the private sector to rebuild primary care and community premises, could be tried.
Under these long-term partnerships, buildings for which there is an immediate need are constructed or refurbished, with others added as the need arises.
The survey showed trusts felt they had benefited from PFI but the negotiating process was costly, bureaucratic and time-consuming and rarely produced good design, while the resulting contracts were too rigid, she said.
Growing numbers were having to be recast in the course of the deal or altered within 18 months or two years of being completed, both of which were costly.
"The big bang solutions don't work very well. It's bad enough trying to predict what the price of fuel will be in 30 years let alone what healthcare will look like.
"The model is 10 years old, and PFI hospitals were built on the assumption healthcare was going to be broadly the same for the next 30 years," she said. With money set to follow the patient, patient choice, and more care being shifted to specialist treatment centres and primary care "that is not now the case".
The criticisms follow warnings from senior health department officials that the NHS was building PFI "monuments" when more flexible buildings are needed.
The private sector was also getting disillusioned, Ms Wyatt said. In the late 1990s there were frequently six bidders to a project. In a number of Scottish cases, and at Whipps Cross in London and Plymouth in Devon there had been only one.
"There is a very real risk that private contractors could walk away from both individual PFI schemes and from major PFI healthcare developments unless the current process is streamlined to reduce the cost, both financially and in terms of time," she said.
http://news.ft.com/cms/s/7bd51674-4819-11da-a949-00000e2511c8.html
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11:43 AM
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