06 January 2006
The future of large NHS Private Finance Initiative schemes has been questioned after the Department of Health ordered a review of the biggest PFI deal to date.
Commercial terms on the £1bn project to redevelop Barts and The London NHS Trust were agreed on December 9 but in late December Health Secretary Patricia Hewitt asked the trust to re-examine the deal.
Hewitt said the trust must ensure the scheme meets local needs and is affordable. Some of the DoH's nervousness is believed to be due to the payment by results hospital funding system, which means trusts can no longer guarantee their future income.
And if patients abandon larger hospitals for smaller specialist or private units under Patient Choice, the NHS could be tied into long-term contracts for hospitals it no longer needs.
The trust said the review was a surprise, particularly as it had worked closely with the department to develop the scheme. Some preliminary work had already taken place, aided by a £4m grant from the Office of the Deputy Prime Minister that recognised the redevelopment's role in revitalising the Thames Gateway.
'The redevelopment of both hospitals will deliver world-class medical facilities for the people of east London and beyond,' a trust spokesman said.
'The existing facilities, some of which date back to the nineteenth century, need to be replaced. This project is affordable. It will also deliver value for money.'
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