Cash ‘leaking’ from the NHS through cost of PFI

A report from the Centre for Health and Public Interest (CHPI) published today highlights the huge cost of Private Finance Initiative (PFI) schemes to the NHS.

PFI is a government backed scheme under which private companies provide money to build new hospitals paid back with interest by the NHS.

The report examined 107 PFI contracts in England and found that the companies involved have generated £831million over the past six years. This money, CHPI say would have been better spent on patient services.

In their report, they call for a cap on PFI costs and for the government to buy out contracts where private companies are making too much profit at the expense of taxpayers.

Speaking to the BBC CHPI chair Colin Leys said the report showed for the first time ‘the huge amount of taxpayer’s money leaking out of the NHS’ through PFI costs.

He added that given the ‘extreme austerity’ faced by NHS services the government needs to act urgently.

Commenting on the CHPI report British Medical Association council chair Dr Chaand Nagpaul said NHS providers and commissioners were ‘being pushed to breaking point’ by the cost of PFI.

He described the scheme as an ‘extortionate drain on the public purse’, and said that private companies were ‘gaining at the expense of tax-payers and patients’, something he said was ‘scandalous’.

Dr Nagpaul backed the call by CHPI for the government to either renegotiate or buy out PFI contracts.

Speaking to the BBC a spokeswoman for the Department of Health said that the NHS was recognised by the independent Commonwealth Fund as being ‘the most efficient healthcare system in the world’, and that PFI costs accounted for just 3% of its annual budget.

Despite the attempts to persuade patients and voters alike differently on the part of the Department of Health this report will have struck a chord with anyone who has used an NHS hospital over the twenty years since PFI was launched.

The buildings may have been transformed from institutional monoliths into the sort of slick architecture that wins prizes, this though, has come at a price.

Private finance has muscled its way into the once sacred turf of the NHS, either in the shape of PFI or retail outlets turning the foyers of hospitals into another place to shop or sip coffee.

There is a real risk this may pave the way for privatization by the back door, if Costa can sell you a coffee while you wait to have your ingrown toenail fixed, why can’t Virgin provide the chiropodist who sorts it out?

That is a question the founders of the NHS would have been shocked to hear asked, because they know that behind it lurks the much more troubling one of how do the people who can’t afford a skinny latte, let alone the cost of falling ill, pay for their healthcare in a system where the hospitals all look like hotels.