§ 12. Mr. Jeremy Corbyn (Islington, North)What estimate he has made of the long-term cost of private finance initiative funding of the Whittington hospital. [127521]
§ The Minister of State, Department of Health (Mr. John Denham)The current project at the Whittington should have a full-life net present cost of around £100 million. This is for the new building, its maintenance and operation over 30 years at today's prices, regardless of how the project is funded. Before the go-ahead is given to a PFI option, it will need to demonstrate that it delivers better value for money than a publicly funded alternative.
§ Mr. CorbynWill the Minister look very carefully at that and any other case of PFI funding of new buildings and consider, first, the long-term cost to local health services incurred by using private finance rather than public finance for new buildings; secondly, the likely increase in the number of private patients in the hospital to increase the income stream to pay the debts resulting from the PFI; and, thirdly, the implications for outlying health facilities in the district, given that experience of previous PFI initiatives tells us that outlying facilities are often closed and fewer beds are available in PFI-constructed hospitals than in publicly funded hospitals? There is great demand for new buildings in the NHS, but does the Minister accept that we must ensure that they are publicly owned and publicly funded?
§ Mr. DenhamThere is certainly a great demand for new hospitals and hospital buildings, which is why I am pleased that the past three years have seen the biggest hospital building programme in the history of the NHS get under way. However, with respect, my hon. Friend is wrong on all counts. There is no evidence that the PFI funding route leads to reduced bed numbers; the whole point of the procedure is that the number of beds required in the local health economy is determined before the decision is made on whether a hospital will be publicly or privately financed. We shall ensure that hospitals planned in future, whether PFI or public sector financed, take full account of the conclusions of the national beds inquiry, which showed that, under the previous Administration, the number of hospital beds was cut far too far.
§ Miss Julie Kirkbride (Bromsgrove)Can the Minister tell us what will be the annual rate of return to private investors who put money into the Whittington hospital?
§ Mr. DenhamThat is a matter for the private investors. What matters to the NHS is to make sure that good value 157 for money is obtained. Under a PFI scheme, the cost of the PFI route is compared with the cost of the public sector route. Experience so far tells us not only that every single PFI scheme that has gone ahead offers better value for money than the public sector alternative, but that PFI schemes are delivered ahead of schedule, instead of overrunning. On hearing Conservative Members, one might gain the impression that they are opposed to PFI. In reality, the Conservative Government spent tens of millions of pounds on consultants but did not get a single PFI hospital built, whereas the Labour Government have used PFI to start the biggest hospital-building programme in the history of the NHS—hospitals like the one in Carlisle are already open and accepting patients.