The UK’s Department for Health (DfH) announced last week that it was making available £1.5 billion (€1.8 billion; $2.4 billion) in long-term funding to help seven hospital Private Finance Initiative (PFI) projects meet their debt commitment to the private sector.
The funding will be made available for a period of 25 years, with payments starting to be doled out from the DfH’s 2012/2013 budget, the department said. However, the bailout fund comes with some strings attached. To make use of it, the troubled hospital trusts will have to meet a few key performance criteria, including drawing up “a clear plan to manage their resources in the future”.
“We know that a small number of NHS [National Health Service] Trusts with PFI arrangements have historic problems relating to these arrangements that make it very difficult for them to manage financially. We need to balance the accountability of the NHS at local level to live within its means on one hand, with recognising that there is a legacy of debt for some Trusts with PFI schemes,” health secretary Andrew Lansley said in a statement.
Lansley has been very critical of hospital PFI arrangements in the past: “The truth is that some hospitals have been landed with PFI deals they simply cannot afford. Like the economy, Labour [the previous party in power] has brought some parts of the NHS to the brink of financial collapse.”
But some critics have suggested that the larger problems of Britain’s NHS lie in the current government’s spending cuts and not PFI.
PFI is the UK government’s standardised procurement process for public-private partnerships.