NHS PFI Schemes Receive Major Criticism

New PFI deals will see hospitals pay £10 billion back in loans for hospitals that cost only £2 billion to build.

The figures have drawn criticism from unions in particular.

It has been revealed that NHS boards will have to make repayments of £285 million in the existing calendar year alone.

Dave Watson, head of policy at Unison Scotland, responsible for representing 60,000 NHS workers, was strongly critical of the PFI programme.

“These toxic contracts are having a damaging impact on the financing of the NHS and the quality of service delivered. The way you deal with other toxic products, such as asbestos, is to tear it out and rebuild, and that is what we should do with PFI. Problems with PFI were anticipated but the cost wasn’t that noticeable when NHS budgets were going up well above inflation. But we’re now in a financial climate where budgets are very tight and PFI contracts are fixed.”

Watson also pointed out that interest rates charged to NHS institutions are often bordering on insulting.

“Councils can borrow from the Public Works Loan Board at around 1.5 per cent interest but PFI hospitals can be paying rates of around 18 per cent. We need to look at how we can buy out or refinance current PFI and using other methods of finance in future.”

Meanwhile, Allyson Pollock, professor of public health at Newcastle University, indicated her belief that the publicly-funded healthcare service had become absolutely privately-run in nature; yet this is often hidden.

“Most patients don’t know that a good proportion of the money that should be going towards their care is being siphoned off to bankers and shareholders, many of whom shelter their profits in tax havens. It’s really important that it’s in the public domain. At the moment, it’s patients who are being blamed for needing or demanding too much.”

Pollock also noted that PFI is beginning to have a bit impact on healthcare outcomes.

“With PFI, the more debt you take on, the more of your income or revenue you have to put into paying your debt, and the less money you have for patient care. It’s like going to a loan shark. We’re mortgaging our future by being locked into these enormous repayments for decades. In many cases, we won’t even own these public building at the end of the contracts or know what condition they’ll be in. This is a catastrophic period for public services and public health.”

PFI is a way of creating “public–private partnerships” (PPPs) by funding public infrastructure projects with private capital.

The concept was developed initially by the governments of Australia and Britain, and is also utilised extensively in Spain.

 

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