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Private Finance Initiatives (North-East)

Volume 542: debated on Tuesday 27 March 2012

8. What his policy is on the rationalisation of PFI deals in the north-east for the purposes of making savings on long-standing PFI hospitals; and if he will make a statement. [R] (101879)

Any plan to rationalise a PFI contract, such as that being considered by Northumbria Healthcare NHS Foundation Trust, would be a local decision. Any trust will need to satisfy itself of the value for money of any proposal. Northumbria Healthcare is a foundation trust, so Monitor is also considering its plans.

Many hospitals around the country are struggling under PFI debt. What plans does the Secretary of State have to ensure that other types of organisations, aside from Northumbria NHS Foundation Trust, will benefit from the new deal, just as my constituents in Hexham are?

I am grateful to my hon. Friend. We have recently made it clear that where there is unsustainable PFI debt—as is the case for seven PFI contracts—we stand ready to support those trusts in meeting some of those costs, which we inherited from the last Government. Beyond that, working with the Treasury, we have undertaken a pilot project that has demonstrated how 5%, on average, can be taken out of the cost of PFI contracts through the better management of them. I hope that will be applied across the country. I welcome, as I know my hon. Friend does, the way in which Northumbria Healthcare, with its local authorities, is looking at resolving its PFI debts, and if that represents value for money, I am sure that others across the country will benefit from the experience.