Letter: Private money

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Sir: As the former chief executive of the Radcliffe Infirmary NHS Trust, with responsibility for putting together the plan for the new hospital in Oxford, I have to take issue with the letter from John Denham, Minister of State for Health, defending the Private Finance Initiative (16 July).

The inescapable fact is that the cost of borrowing money for the private sector is greater than for the Government. The costs of maintenance and other things are being used as a smokescreen or spin for the minister to hide behind. If a straight comparison is made on the cost of financing the capital for building new hospitals, the public sector scheme will be better value for money.

The Private Finance consortiums are intent on reducing risk and making a profit. The NHS will be paying the costs of that risk-avoidance and profit margin for years to come.

What also surprises me is that the bid to build a new hospital in Oxford had to be submitted to the Department of Health in September 1998 to enable ministers to make a decision by Christmas. What they didn't tell us was which Christmas! If the Private Finance Initiative is as good as Mr Denham claims, why did it take so long to make the decision?