This story was first published in digitalhealth.net
Trust saves £67 million by breaking PFI deal
The trust borrowed £114 from the local council to pay off the Catalyst consortium responsible for Hexham General hospital, yielding savings of roughly £3.5 million every year for 19 years.
The repurchase of Hexham hospital has led to concerns that the private-finance initiative (PFI) programme under which many similar contracts were made represents poor value for councils, and that more trusts will borrow money from councils to extricate themselves from such deals.
The hospital cost £54 million to build in three stages, with Tony Blair opening the first in 2004. Catalyst consortium, which includes the Bank of Scotland, was contracted to run the hospital for 32 years and is reported to have made significant profits on breaking the deal early.
Jim Mackey, Northumbria Healthcare NHS Foundation Trust's chief executive, said: “Without PFI we would never have been able to build the fantastic facility we have today at Hexham General Hospital.”
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