East Lancs hospitals must cough up £1bn

East Lancs hospitals must cough up £1bn

East Lancs hospitals must cough up £1bn

First published in News Blackburn Citizen: Photograph of the Author by , Health Reporter

CAMPAIGNERS fear East Lancashire’s troubled hospitals will struggle to address their problems while a ‘rip-off’ contract with the private sector remains in place.

The Royal Blackburn and Burnley General, which are in special measures, are tied into long-term ‘mortgages’ under the Private Finance Initiative (PFI), with the combined annual payments now standing at more than £20 million.

The Royal Blackburn and much of Burnley General were built by private companies in 2006, at a combined cost of about £140 million, but East Lancashire Hospitals NHS Trust (ELHT) will have to pay back almost £1 billion by the year 2041, due to interest charges.

Burnley MP Gordon Birtwistle, said: “I’m really worried about these crippling costs, especially at a time when the trust is desperately trying to make improvements.

“These contracts are a complete and utter rip-off and the private companies are creaming off NHS money that should be spent on treating patients. It’s going to stay like that for another 30 years or so and they can’t get out of it.”

A Kent-based firm called Consort Healthcare (Blackburn) Limited built the Royal Blackburn Hospital at a cost of £109 million, and will receive £796 million from the trust over 36 years. The deal includes other services such as maintenance, security, window cleaning and pest control.

The Burnley contract, which saw £30 million spent on the Phase 5 area of the hospital, is held by Manchester-based SPC Ltd Facilities Management.

The trust will have to pay back £181 million over 35 years, with the deal including security and car parking services.

But Jonathan Wood, director of finance at ELHT, said: “The cost of running the trust’s estate (including the two PFIs) and associated services has been benchmarked and is in line with other similar sized NHS providers.

“In many respects a PFI contract can be compared to having a mortgage with a few additional extras, including responsibilities for maintaining our buildings, security arrangements, car parking and window cleaning.”

Russ McLean, chairman of the Pennine Lancashire Patient Voices Group, said: “I’m absolutely appalled to think of that huge amount of money disappearing from the local health economy, at a time when the trust is already having to make huge cost savings.

“That money would have been better spent improving healthcare.”

However, Blackburn MP Jack Straw defended the Blackburn deal, saying it was the ‘only possibility for a new hospital’ at the time.

PFI was introduced by the Conservative government in the 1990s, but expanded dramatically by Labour as a means of enabling private investors to take on the financing, construction and operation of public sector infrastructure projects.

Comments (14)

Please log in to enable comment sorting

11:18am Tue 6 May 14

vicn1956 says...

So-ALL the political parties share some blame.
Remember Blair/Brown(a miracle-the end of boom and bust) preening themselves over all these new hospitals/schools. Then leave others to pick up the pieces yet retain the right to criticise other's attempts at sorting out their mess.
Still-millions will give them their votes again!
So-ALL the political parties share some blame. Remember Blair/Brown(a miracle-the end of boom and bust) preening themselves over all these new hospitals/schools. Then leave others to pick up the pieces yet retain the right to criticise other's attempts at sorting out their mess. Still-millions will give them their votes again! vicn1956
  • Score: 27

11:23am Tue 6 May 14

mavrick says...

Jack Straw said it was the only option for a new hospital, I doubt we needed.
The whole PFI seemed set to line pockets of private investors. The quality of the build of the new hospitals are poor, I don't know who accepted the buildings in the current state. Switches and sockets not straight, Mirrors sighted in the wrong place in some washing and toilet areas. If they can get away with such poor workmanship it makes you wonder what the unseen construction is like. I am afraid Tony and Jack made a colossal mistake with this deal.These companies have had more than their money back, It just shows how the greedy always want more.
Jack Straw said it was the only option for a new hospital, I doubt we needed. The whole PFI seemed set to line pockets of private investors. The quality of the build of the new hospitals are poor, I don't know who accepted the buildings in the current state. Switches and sockets not straight, Mirrors sighted in the wrong place in some washing and toilet areas. If they can get away with such poor workmanship it makes you wonder what the unseen construction is like. I am afraid Tony and Jack made a colossal mistake with this deal.These companies have had more than their money back, It just shows how the greedy always want more. mavrick
  • Score: 25

11:55am Tue 6 May 14

Champagne plus charlie says...

Did they borrow the money for these buildings from Wonga?

Great negotiation skills there, whoever signed these agreements needs to be fired, immediately.
Did they borrow the money for these buildings from Wonga? Great negotiation skills there, whoever signed these agreements needs to be fired, immediately. Champagne plus charlie
  • Score: 22

12:24pm Tue 6 May 14

brossen99 says...

Time to end Gordon 'Brown's Corporate-Nazi PFI welfare state for the stock market parasites even if it was John Major's idea in the first place ?
Time to end Gordon 'Brown's Corporate-Nazi PFI welfare state for the stock market parasites even if it was John Major's idea in the first place ? brossen99
  • Score: 14

1:12pm Tue 6 May 14

Kevin, Colne says...

We are living through one of those all too frequent periods when the political establishment is failing the nation.

As I understand PFI the idea was intended for small-scale projects but once the political class realised that they could have new things almost immediately while simultaneously securing votes and placing the financial burden on our children they adopted the model wholesale. I believe that PFI liabilities are considered nationally to be off-balance sheet.

I well remember receiving election leaflets from representative of the Labour Party extolling the wonders of the new hospitals and schools with nary a word about the PFI funding arrangements. This was the point at which I came to realise that the Labour Party had come completely adrift from its bearings and was interested in power rather than people, and that they were determined to deliver my family, including my children, into debt slavery. I came to realise too that the Party candidates in so evidently supporting, or ignoring, this funding method were in reality revealing that they simply were not up to the job. Naturally I refused to vote for these candidates but to my utter amazement and astonishment a large number of my fellow citizens supported them with gusto.

Unfortunately the Conservative and Liberal-Democrat Parties that form the current Coalition Government are following the same path, albeit using different areas of public policy but with a similar degree of sophistry and deceit.

One must remain hopeful, but the political situation is absolutely dire.

Nationally the political parties are led by people that appear to come from the same cookie-cutter and in comparison with leaders of yore the current crop seem to be exceedingly timid and give the impression of lacking gumption. Meanwhile party membership is collapsing. One has only to listen to BBC Radio 4 Any Questions? To become acutely aware of the total lack of imagination among elected party representatives who willingly support party policy no matter how foolish or misguided, and who spout the party-line faithfully in a manner that makes you wonder whether they are capable of independent and original thought.

Sorry for the rant, but there are times when one feels rather exasperated at what’s happened, what is happening and where we’re headed.
We are living through one of those all too frequent periods when the political establishment is failing the nation. As I understand PFI the idea was intended for small-scale projects but once the political class realised that they could have new things almost immediately while simultaneously securing votes and placing the financial burden on our children they adopted the model wholesale. I believe that PFI liabilities are considered nationally to be off-balance sheet. I well remember receiving election leaflets from representative of the Labour Party extolling the wonders of the new hospitals and schools with nary a word about the PFI funding arrangements. This was the point at which I came to realise that the Labour Party had come completely adrift from its bearings and was interested in power rather than people, and that they were determined to deliver my family, including my children, into debt slavery. I came to realise too that the Party candidates in so evidently supporting, or ignoring, this funding method were in reality revealing that they simply were not up to the job. Naturally I refused to vote for these candidates but to my utter amazement and astonishment a large number of my fellow citizens supported them with gusto. Unfortunately the Conservative and Liberal-Democrat Parties that form the current Coalition Government are following the same path, albeit using different areas of public policy but with a similar degree of sophistry and deceit. One must remain hopeful, but the political situation is absolutely dire. Nationally the political parties are led by people that appear to come from the same cookie-cutter and in comparison with leaders of yore the current crop seem to be exceedingly timid and give the impression of lacking gumption. Meanwhile party membership is collapsing. One has only to listen to BBC Radio 4 Any Questions? To become acutely aware of the total lack of imagination among elected party representatives who willingly support party policy no matter how foolish or misguided, and who spout the party-line faithfully in a manner that makes you wonder whether they are capable of independent and original thought. Sorry for the rant, but there are times when one feels rather exasperated at what’s happened, what is happening and where we’re headed. Kevin, Colne
  • Score: 18

2:13pm Tue 6 May 14

shirtbox says...

Another Blair Straw mess up.Vote Labour again at your peril.
Another Blair Straw mess up.Vote Labour again at your peril. shirtbox
  • Score: 16

3:11pm Tue 6 May 14

vicn1956 says...

I despair at them all but it scares me that Milliband/Balls will get in and repeat and even "better" what they did last time. Because their hands were firmly on the tiller of the last government. Then again can you consider Cameron's lot? and Clegg???????????????
???
I despair at them all but it scares me that Milliband/Balls will get in and repeat and even "better" what they did last time. Because their hands were firmly on the tiller of the last government. Then again can you consider Cameron's lot? and Clegg??????????????? ??? vicn1956
  • Score: 15

3:53pm Tue 6 May 14

kateash says...

Imagine how many nurses could have been employed for that amount of money.. New buildings do not improve the standard of care !!! Too many cutbacks have been made for years at East Lancs except for admin staff!! Staff are told to "work lean" ... No wonder the hospital is in such a mess!!!
Imagine how many nurses could have been employed for that amount of money.. New buildings do not improve the standard of care !!! Too many cutbacks have been made for years at East Lancs except for admin staff!! Staff are told to "work lean" ... No wonder the hospital is in such a mess!!! kateash
  • Score: 15

5:42pm Tue 6 May 14

Michael@ClitheroeSince58 says...

Kevin, Colne wrote:
We are living through one of those all too frequent periods when the political establishment is failing the nation.

As I understand PFI the idea was intended for small-scale projects but once the political class realised that they could have new things almost immediately while simultaneously securing votes and placing the financial burden on our children they adopted the model wholesale. I believe that PFI liabilities are considered nationally to be off-balance sheet.

I well remember receiving election leaflets from representative of the Labour Party extolling the wonders of the new hospitals and schools with nary a word about the PFI funding arrangements. This was the point at which I came to realise that the Labour Party had come completely adrift from its bearings and was interested in power rather than people, and that they were determined to deliver my family, including my children, into debt slavery. I came to realise too that the Party candidates in so evidently supporting, or ignoring, this funding method were in reality revealing that they simply were not up to the job. Naturally I refused to vote for these candidates but to my utter amazement and astonishment a large number of my fellow citizens supported them with gusto.

Unfortunately the Conservative and Liberal-Democrat Parties that form the current Coalition Government are following the same path, albeit using different areas of public policy but with a similar degree of sophistry and deceit.

One must remain hopeful, but the political situation is absolutely dire.

Nationally the political parties are led by people that appear to come from the same cookie-cutter and in comparison with leaders of yore the current crop seem to be exceedingly timid and give the impression of lacking gumption. Meanwhile party membership is collapsing. One has only to listen to BBC Radio 4 Any Questions? To become acutely aware of the total lack of imagination among elected party representatives who willingly support party policy no matter how foolish or misguided, and who spout the party-line faithfully in a manner that makes you wonder whether they are capable of independent and original thought.

Sorry for the rant, but there are times when one feels rather exasperated at what’s happened, what is happening and where we’re headed.
Nice post Kevin, I hope people read it and realise that our political system is dead in the water it's time for a change. We need a strong Party on the Left that looks after hard working people one with some eggheads that have vision not like the present bunch of jokers.
[quote][p][bold]Kevin, Colne[/bold] wrote: We are living through one of those all too frequent periods when the political establishment is failing the nation. As I understand PFI the idea was intended for small-scale projects but once the political class realised that they could have new things almost immediately while simultaneously securing votes and placing the financial burden on our children they adopted the model wholesale. I believe that PFI liabilities are considered nationally to be off-balance sheet. I well remember receiving election leaflets from representative of the Labour Party extolling the wonders of the new hospitals and schools with nary a word about the PFI funding arrangements. This was the point at which I came to realise that the Labour Party had come completely adrift from its bearings and was interested in power rather than people, and that they were determined to deliver my family, including my children, into debt slavery. I came to realise too that the Party candidates in so evidently supporting, or ignoring, this funding method were in reality revealing that they simply were not up to the job. Naturally I refused to vote for these candidates but to my utter amazement and astonishment a large number of my fellow citizens supported them with gusto. Unfortunately the Conservative and Liberal-Democrat Parties that form the current Coalition Government are following the same path, albeit using different areas of public policy but with a similar degree of sophistry and deceit. One must remain hopeful, but the political situation is absolutely dire. Nationally the political parties are led by people that appear to come from the same cookie-cutter and in comparison with leaders of yore the current crop seem to be exceedingly timid and give the impression of lacking gumption. Meanwhile party membership is collapsing. One has only to listen to BBC Radio 4 Any Questions? To become acutely aware of the total lack of imagination among elected party representatives who willingly support party policy no matter how foolish or misguided, and who spout the party-line faithfully in a manner that makes you wonder whether they are capable of independent and original thought. Sorry for the rant, but there are times when one feels rather exasperated at what’s happened, what is happening and where we’re headed.[/p][/quote]Nice post Kevin, I hope people read it and realise that our political system is dead in the water it's time for a change. We need a strong Party on the Left that looks after hard working people one with some eggheads that have vision not like the present bunch of jokers. Michael@ClitheroeSince58
  • Score: 14

6:00pm Tue 6 May 14

Pegasus216 says...

Voters of Blackburn, remember who got you here...it was the LABOUR Party, and you are thinking of voting these numpties in again Milliband, Balls et al.
Rich boys who have not got a clue, do so at our national peril
G
Voters of Blackburn, remember who got you here...it was the LABOUR Party, and you are thinking of voting these numpties in again Milliband, Balls et al. Rich boys who have not got a clue, do so at our national peril G Pegasus216
  • Score: 15

8:59pm Tue 6 May 14

jenkinsroy says...

This is what this government wanted TO PRIVATE TISE THE N.H.S.
and now it is time to pay the man and all this government can say is its LABOURS FAULT NOT THEIRS so vote for us in MAY and we will
still close your hospital but faster O.K. I think NOT TIME TO GET YOU OUT
We can start in may by voting any one of the over party in our towns where
we are voting for our local councillors we can start by voting the lib dems
out the conservatives and vote any party in this will help by under minding their hold on the amount of seats they hold at the general elections in 2015 so start now we can take back our lives if we stand up to this government now they have gone to far now this county is going under with them in charge so lets get them out starting in may
This is what this government wanted TO PRIVATE TISE THE N.H.S. and now it is time to pay the man and all this government can say is its LABOURS FAULT NOT THEIRS so vote for us in MAY and we will still close your hospital but faster O.K. I think NOT TIME TO GET YOU OUT We can start in may by voting any one of the over party in our towns where we are voting for our local councillors we can start by voting the lib dems out the conservatives and vote any party in this will help by under minding their hold on the amount of seats they hold at the general elections in 2015 so start now we can take back our lives if we stand up to this government now they have gone to far now this county is going under with them in charge so lets get them out starting in may jenkinsroy
  • Score: 9

10:49pm Tue 6 May 14

Sue Lee says...

Is my Maths right? 19% interest? Nice work, if
Is my Maths right? 19% interest? Nice work, if Sue Lee
  • Score: 8

11:07am Wed 7 May 14

ConcernedOssy says...

Champagne plus charlie wrote:
Did they borrow the money for these buildings from Wonga?

Great negotiation skills there, whoever signed these agreements needs to be fired, immediately.
Problem with doing that is, it would mean Sack ALL the Clowncillors the majority of the Clown hall staff, and the future Mp for Blackburn (wonder who that might be ?) Seeing as how the original perpetrator has "retired to a life of luxury, may he should be sued for his crass stupidity he could afford a sizeable payment from his overflowing pension pot !!! At the time of decision a spokesman said it would have been cheaper on Barclaycard
[quote][p][bold]Champagne plus charlie[/bold] wrote: Did they borrow the money for these buildings from Wonga? Great negotiation skills there, whoever signed these agreements needs to be fired, immediately.[/p][/quote]Problem with doing that is, it would mean Sack ALL the Clowncillors the majority of the Clown hall staff, and the future Mp for Blackburn (wonder who that might be ?) Seeing as how the original perpetrator has "retired to a life of luxury, may he should be sued for his crass stupidity he could afford a sizeable payment from his overflowing pension pot !!! At the time of decision a spokesman said it would have been cheaper on Barclaycard ConcernedOssy
  • Score: 11

12:31pm Wed 7 May 14

ConcernedOssy says...

mavrick wrote:
Jack Straw said it was the only option for a new hospital, I doubt we needed.
The whole PFI seemed set to line pockets of private investors. The quality of the build of the new hospitals are poor, I don't know who accepted the buildings in the current state. Switches and sockets not straight, Mirrors sighted in the wrong place in some washing and toilet areas. If they can get away with such poor workmanship it makes you wonder what the unseen construction is like. I am afraid Tony and Jack made a colossal mistake with this deal.These companies have had more than their money back, It just shows how the greedy always want more.
Jacks Logic has always been illogical he must have been a graduate at Plant Zonk as with many other members of the past & PRESENT CLOWNCIL
[quote][p][bold]mavrick[/bold] wrote: Jack Straw said it was the only option for a new hospital, I doubt we needed. The whole PFI seemed set to line pockets of private investors. The quality of the build of the new hospitals are poor, I don't know who accepted the buildings in the current state. Switches and sockets not straight, Mirrors sighted in the wrong place in some washing and toilet areas. If they can get away with such poor workmanship it makes you wonder what the unseen construction is like. I am afraid Tony and Jack made a colossal mistake with this deal.These companies have had more than their money back, It just shows how the greedy always want more.[/p][/quote]Jacks Logic has always been illogical he must have been a graduate at Plant Zonk as with many other members of the past & PRESENT CLOWNCIL ConcernedOssy
  • Score: 9

Comments are closed on this article.

Send us your news, pictures and videos

Most read stories

Local Info

Enter your postcode, town or place name

About cookies

We want you to enjoy your visit to our website. That's why we use cookies to enhance your experience. By staying on our website you agree to our use of cookies. Find out more about the cookies we use.

I agree