The Full Business Case (FBC) for Barking, Havering and Redbridge NHS Trust’s private finance initiative (PFI) scheme was approved by the Department and HM Treasury in 2003. To be approved, an FBC must demonstrate that the private finance option is affordable to the local health economy (i.e. national health service trusts and primary care trusts as commissioners) and value for money when compared with the public capital funded alternative.
PFI unitary payments are just one component of an NHS trust’s expenditure.
Barking, Havering and Redbridge NHS Trust is forecasting a year end deficit of £14.3 million at quarter 1 2007-08.
As a result of the Department introducing the new loans system in 2006-07, there are 17 national health service trusts, where the financial challenges are such that the Department either could not give a loan because the trusts could not afford to meet the repayments, or where a loan was agreed, but the amount is very large and could only be repaid over a very extended time scale.
Departmental officials have worked in partnership with strategic health authorities (SHAs) on a review process to identify long term solutions for the 17 NHS trusts, Barking, Havering and Redbridge NHS Trust being one of them. The results of this recently completed review process are now being discussed with the SHAs and solutions are being prepared in the context of the Operating Framework for 2008-09.