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BMJ 2011;343:d6681 doi:
10.1136/bmj.d6681 Page 1 of 1 Letters LETTERS PFI CAUSING FINANCIAL PROBLEMS NHS cuts and PFI Mark Hellowell lecturer Global Public Health Unit, School of Social and Political Science, University of Edinburgh, Edinburgh EH8 9LD, UK Lansley suggests that the private finance initiative (PFI) is the who, as leader of the opposition, claimed the Tories would avoid main cause of financial problems among 22 NHS trusts, which such “cuts” once in government. He made the claim in Chase are “on the brink of collapse.”1 The media have largely reflected Farm Hospital, where the maternity services he pledged to the line that Lansley is faced with the task of cleaning up protect are shortly due to close. Labour’s “mess,” and that any hospital closures he sanctions Blaming PFI for this looks strange when private finance is a can be blamed on them. central part of coalition policy. Since May 2010, ministers have This account is misleading. The destabilising influence of PFI approved six new hospital PFIs with a combined capital value within the context of payment by results has long been of £1.4bn (€1.6bn; $2.2bn). It was John Major who introduced understood. Because payment by results allocates resources to PFI for the NHS in the early 1990s, and successive governments trusts on the basis of average treatment costs across the NHS, have used it to provide investments above what formal budgets trusts with PFI projects in place (and therefore much higher would allow. than average fixed costs) will often run deficits. Such deficits Given the priority afforded to the deficit, it is no surprise that accumulate over time and can become unmanageable. the current government has embraced this form of off-balance The question is what we should do about this. It serves no sheet financing. But it should clearly state that it has done so efficiency purpose to penalise trusts for having high fixed costs, and stop playing politics. which are ultimately traceable to decisions taken in Whitehall. It is obvious that these costs should be borne centrally. The Competing interests: None declared. payment by results tariff should be adjusted so that trusts are fully funded for their fixed capital costs. 1 O’Dowd A. Trusts deny health secretary’s claims that private finance initiatives have caused major financial problems. BMJ 2011;343:d6133. (26 September.) Instead, ministers are using PFI as a means of explaining away hospital closures. Service rationalisation may in some cases be Cite this as: BMJ 2011;343:d6681 necessary. But it is highly embarrassing for David Cameron, © BMJ Publishing Group Ltd 2011 mark.hellowell@ed.ac.uk For personal use only: See rights and reprints http://www.bmj.com/permissions Subscribe: http://www.bmj.com/subscribe
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