NHS facing £65bn mortgage bill for PFI
The NHS in England faces a total bill of £65bn for new hospitals built under the private finance initiative (PFI)- six times more than the buildings cost.
Figures obtained by the BBC show that some NHS trusts are spending more than 10 percent of their turnover on the annual ”mortgage” repayments.
Under PFI, private companies win contracts to build and maintain new hospitals and mental health units and the NHS pays off the ”mortgage” over around 30 years.
The 103 schemes were valued at a total of £11.3bn when they were built.
But when rising fees and additional costs such as maintenance, cleaning and catering are taken into account, the NHS will have to pay back £65.1bn over the lifetime of the schemes. Some contracts are reportedly so restrictive that trusts are forced to pay hundreds of pounds just to get half a dozen pictures put up.
According to the data, the NHS currently pays back a total of £1.25bn each year but this figure is expected to increase until 2030 when it will hit £2.3bn, the BBC reported.
The final payment will not be made until 2048.
Professor John Appleby, chief economist at the King’s Fund health think-tank, said: ”It is a bit like taking out a pretty big mortgage in the expectation your income is going to rise, but the NHS is facing a period where that is not going to happen.”
Dr Mark Porter, of the British Medical Association, added: ”Locking the NHS into long-term contracts with the private sector has made entire local health economies more vulnerable to changing conditions.
”Now the financial crisis has changed conditions beyond recognition, so trusts tied into PFI deals have even less freedom to make business decisions that protect services, making cuts and closures more likely.”
Nigel Edwards, director of policy at the NHS Confederation, which represents trusts, told the BBC: ”They were planned for a different world. I’m sure that in some cases people feel their hands are tied.”
Tags: BMA, labour liars, Labour shambles, nhs cash shortages, nhs cutbacks, PFI, red tape