Sharing the wealth

The profits being accrued by not only the Hospital Company (THC) but the Dartford & Gravesham Trust may be pretty eyeopening, but only the dangerously naïve would not have forseen this. However even for a born-again realist like me, The National Audit Office's report on the Darent Valley Hospital PFI contract (one of several - this almost appears its favourite scheme to scrutinise) is fairly shocking reading. It shows that THC managed to withdraw a lump sum of £37m from the project following its refinancing in 2003, and its shareholders expect to make £51 m of profit over the project's extended 35 year contract. However what might prove even more shocking to those shy, timorous individuals aghast that the private sector has entered the NHS only to, shock horror, make a profit, is that the NHS is doing pretty well out of the deal too.

In return for taking on additional risks around termination of the contract, the trust not only received a cool £1.5m on refinancing, but also a reduction of £2m to its "annual contract price," ie the unitary service payment for the facility to the consortium, over the whole contract. It seems like too much of a coincidence that the original affordability gap identified on the project was also £2m - this shortfall is neatly covered by this new windfall. Whether originally linked or not, it leaves the health authority with less of a burden.

One can only wonder about the conversations that took place between trust and PFI provider, whether they were along the lines of "Look we can't afford this," "Oh yes you can, wait and see what happens when we talk to the banks after we've finished the building." But then again this, as with most things in PFI is just simple economics, nothing to do with design or services. The major fear is that when clinical needs change dramatically in a few years time, as they surely will, the trust does not need to terminate the contract in a hurry. Then it could really see PFI become its nemesis instead of its saviour.

James Parker, Editor