Letter: Expensive hospitals

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Sir: The chief executive of Bart's and London hospital trust agrees with the consultants' medical council that the planned hospital to be built by private finance initiative (PFI) will increase the shortfall in meeting local clinical needs ("Bart's pounds 460m rebuilding project `unworkable' ", 25 November). A balance must be struck, he says, with "realistic financial expectations".

In all PFI hospitals so far planned, beds, medical staff and services have been cut, beds by up to 30 per cent. The basis of PFI arithmetic is the calculation of construction costs, that is, the size of the hospital, according to the rent the trust can afford. Meeting clinical need is not the priority. What the annual rent pays is the servicing of the bank borrowing by the PFI consortium and the return of up to 25 per cent annually to investors. It is the cuts in beds and staff that pay this extravagant return.

The new Bart's and London Hospital, like other PFI hospitals, will probably pay an annual rent of about 15 per cent of construction cost of pounds 460m, about pounds 69m for 30 years. By the end of the leasing period it could have spent pounds 2.07bn, 4.5 times the original cost.

Clinical need has not been met adequately in our NHS for a long time. If PFI is to make the situation worse the Government must say what a community gains that compensates for what it has lost.


London NW3