NHS Closure Fears - £1.5bn Private Finance Initiative (PFI) deals

Original posting, August 2006

The government has announced six private finance initiatives (PFI) worth £1.5 billion to build new NHS facilities. I suspect tax payers money will be used to build the facilities which will then be handed over to private health companies.

Surprise there, eh?

Up to 10 hospitals across England have closed or have had their services slashed. Local trusts are still trying to balance their books, apparently. Then build some new hospitals. Not revamp what already exists. I imagine that they are probably in the wrong locations to benefit private health insurance.

A&E units could also be closed at some hospitals, but it remains unclear if these are from the 10 already mentioned or others.

Andy Burnham (health minister) says state-of-the-art facilities for 100,000s of patients across the country will be provided.

Private patients?

The announcement was made only two months after it emerged that trusts in England ran up deficits of almost £1.3 billion last year. This despite record funding for the health service.

Or allowed to run up deficits?

It was described "ironic" by doctors' leaders that details of closures and cuts emerged on the same day as the government's latest PFI announcement. And separately (Jonathan Fielden, deputy chairman of the BMA's consultants' committee), "there are better and cheaper ways to finance improvements. The future of these hospitals is being mortgaged while private providers make profits from the NHS. We are seeing NHS facilities mothballed and closed, and dedicated staff being made redundant at a time when private companies are profiting from PFI deals and poorly performing independent sector treatment centres."

The NHS (ie taxpayer) will repay the firms that build the hospitals over 25 to 30 years in these PFI deals.

"PFI schemes are expensive, inflexible and are adding to the current financial burdens of many hospital trusts. Time and time again PFI companies milk these projects through overcharging and lucrative refinancing deals. These new hospital schemes could and should be paid for by much cheaper public sector borrowing."

[No. No. No. Make it cost more to the taxpayer and make it more and more unattractive. There will, ultimately, be less and less opposition to getting rid of the NHS.]

All this manipulation is well thought through by this "incompetent" government. Such is the illusion. So much "magic" is underway.

To get state-of-the-art facilities costs an awful lot of money. Who does it cost? The tax payer, of course. Ask yourself this: how long, if ever, will we benefit? The decision is made and construction is approved and started. Before it is completed there will be cost overruns. Remember the Dome? The escalating costs will inevitably call for closing down the NHS. What would become of it? Sell it off at a loss to private business, of course.

The Queen Elizabeth Hospital in Woolwich (technically insolvent last year) was paying £9 million a year more for its PFI than if it had signed a traditional publicly-financed contract.

Despite the criticism, Mr Burnham stressed that more than £10 billion had been spent on new hospitals - since 1997. A total of 76 schemes had been completed: 58 PFI and 18 publicly funded. With a further 30 under construction. How are these funded? I imagine these are PFI schemes too. Seems they will be more lucrative - eventually.

The spin is that this amount was spent and the implication is that it was 'value spend' not a wasted tax-payers 'donation' to...

...who? How was this money 'spent'? Used up? Where did it go? What did it provide?

Comments are backed by the Confederation of British Industry. This organisation argues that the PFI scheme is the way forward. Well, they have the interests of the construction industry in mind. Rather like the ABI (Association of British Insurers) has the interest of the insurance industry in mind. The businesses, yes. The customers, NO, NO, NO. Just a shop window to help 'sell' insurance to 'the people'.

If this happens, is it tantamount to fraud.

Just asking.

But consider the private householder situation. Any debts run up are held against you for life. All this crap about declaring yourself bankcrupt. Same lunatic ethos as self-certification mortgage applications. In the very short term debts may appear to 'disappear' though see what sort of problems you encounter in the future when trying to raise money. The very wealthy perform all sorts of tricks to save money.

Unless they get everything done for 'free' (what favour was that?), it costs a large fortune to save a smaller one.

Or at least that is the illusion.