The £214m Norfolk & Norwich Hospital PFI scheme will cost a massive £70m (50%) more than a publicly-funded option Norfolk & Norwich Health Care NHS Trust Norfolk and Norwich Hospital MAIN ENTRANCE AFTER six months of constipated silence, Health Secretary Frank Dibson has opted to overrule the findings of the Royal Commission on Care of the Elderly. Pensioners groups and charities are furios that he has opted to maintain the system of means-tested charges for nursing home care inroduced by the lories in 1993. Thatcher's government saw the possibility of forcing a growing number of patients to pay for their own care, by switching responsibility for continuing care from the NHS (where treatment is free at point of use) to local authorities.
The Royal Commission - set up following a pledge in the 1997 election campaign - had recommended that all nursing care for frail elderly patients should be paid for by the NHS, at a cost of an extra £1.3 billion a year.
This is the amount now being paid by individual nursing home patients, often at the cost of selling their houses and liquidating their life savings.
Labour MPs and councillors from the outset supported the Tory "community care" reforms, first proposed by Sainsbury boss Building firms, banks, business consultants and other PFI hangers-on are eagerly anticipating a generous flow of profits as the first hospital schemes take shape.
A recent investigation in the Health Service Journal showed building contractors "expecting returns of up to 20 percent a year on the equity stakes they hold in the project companies" as soon as the building is complete and Trusts start paying up for the use of the new buildings.
Consultancy firms, too -architects, engineers and surveyors - are pocketing above average fees for work on PFI schemes:
And once the building is finished, maintaining the buildings will deliver comfortable, guaranteed profits of up to 7 percent for firms holding service contracts.
As the HSJ article points out "there is little chance of the construction industry losing interest in PFI hospitals". (Profits for Industry, HS] 13 May).
A recent BMJ article pointed out that shareholders in PFI schemes "can expect real returns of 15-25 percent a year", and went on to explain how little risk is involved for the companies in PFI consortia.
The new Greenwich Hospital scheme, for example, assumes that risks worth a massive f20m are being transferred to the private sector. But in fact the prospectus of Meridian, the firm launching the bond issue to fund the deal, claimed that the contract was structured so that "few risks Sir Roy Griffiths in 1988, which extended the system of means-tested charges as a way of cutting government spending.
But the implementation of the new system from 1993 led to an estimated 40,000 houses a year being sold by elderly people to pay nursing home fees.
Vicious new "eligibility criteria" from 1996 enabled health authorities to slash back their provision of NHS continuing care beds for the frail elderly, and helped generate a groundswell of anger.
Tory ministers were already under pressure from their own voters in the run-up to the election, where Labour hinted that a Royal Commission would lead to a change of policy.
Two years later it is clear that Dobson will seek only the most timid changes, deferring for tup to hree months any instruction for elderly patients to sell their houses to pay for their care.
Coupled with the refusal to upgrade the state pension, and the restrictions on prescriptions for Viagra, Dobson has compounded New Labour's policy of sticking the boot into the elderly, while leaving the profits of the private sector untouched. inherent in the prolect are retained" by the company.
A detailed study commissioned by UNISON of one Full Business Case, for North Durham Acute Hospitals Trust, revealed the extent to which some PFI deals rig the figures to make the case for private funding.
The new Dryburn hospital represents more than a 50 percent reduction in beds compared with the original 1991 plan for a publicly-funded hospital, and will treat 7 percent fewer inpatients than the present level, while axing more than ten percent of its qualified nurses.
"Despite an investment of £96m, annual payments to the private sector of over £|2m a year for 30 years, subsidies from central government and the selling off of NHS property, not a single extra patient will be treated." * Downsizing for the 2Ist Century, by Declan Gaffney and Allyson Pollock, published by UNISON.