NHS campaigners slam profits from PFI tax haven sell-off
Article published: Wednesday, May 15th 2013
The multi-million pound sell-off of a PFI stake in the troubled Tameside Hospital has been condemned by campaigners fighting NHS privatisation.
A car park at Tameside Hospital under construction in 2007. Photograph: David Watson
Construction firm Balfour Beatty disposed of its 50 per cent stake in the hospital PFI to infrastructure firm HICL earlier this month in a deal worth £16m.
Balfour made £9m from the deal having contributed an original £7m equity in 2007 to build new facilities including ward space for older people with mental health issues, an energy centre and a surface car park.
Public payments for the PFI will now be made to HICL, which is registered in the notorious channel island tax haven of Guernsey.
Bernadette Hyland of Keep Our NHS Public slammed the deal, saying “this is another example of allowing big companies to buy and sell assets of the NHS.
“It is outrageous at a time when users of the NHS are suffering threats to local hospitals and are being told that resources need to be rationed. People should come before profit.”
Profits
HICL, an independent spin-off company that was formerly a HSBC investment trust, now owns 100 per cent of the PFI. Tameside Hospital pays around an annual £10m on the 34-year project.
Excess profits made through PFI deals, often decades-long contracts where public agencies pay private companies to build assets such as schools and hospitals using private finance, were slammed last year by Parliament’s influential Public Accounts Committee.
In a May 2012 report, MPs said, “Where there is evidence that investors are making high rewards during the contract period which are out of line with the risks they bear, public authorities need mechanisms for sharing in these rewards.”
Struggling
Tameside hospital was reprimanded by the NHS regulator Monitor in 2011 for going into debt and had a £4.78m deficit in 2012 according to its latest set of accounts.
The trust has recently undergone a series of cost-cutting exercises, including voluntary redundancies, and managers told local news publications last year that they expected to close the gap by March 2013.
Located in an area with the worst rate of heart disease in the UK, Tameside is one of 14 hospitals to be inspected as part of a major government health probe due to a higher than expected patient death rate.
Speaking to reporters about the inspection, hospital Chief Executive Christine Glower said she was confident inspectors “will see how committed we are to working with our partner organisations to provide high quality care to all our patients and reduce our death rates.”
Richard Goulding
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Comments
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90% of public contact with the NHS is via private contactors to it.
These contractors are called GPs or family doctors.
Most people are happy with their GPs and trust them, so demonstrating that privatised NHS provision can be a success.
Anti-privatisation scaremongering is done mainly by NHS staff who fear losing their monopoly of the work and has nothing to do with care or patients.
Comment by pete on June 5, 2013 at 10:46 pm
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