THE report by the National Audit Office (NAO) into the running of Hinchingbrooke Hospital in Cambridgeshire gives official and damming evidence of the plundering of the NHS by the private health companies.
Hinchingbrooke was the first hospital in the country to be put out for tender last February, with private health providers and speculators invited to bid for a ten-year contract to run the hospital and extract as much profit from it as possible.
At the time, Hinchingbrooke had a deficit of £39 million and the ten-year contract to run the hospital was won by Circle Health which pledged to make over £300 million savings over the ten years, savings to be made by ‘efficiencies’ mainly in staffing.
To win the contract, Circle promised to pay off all the debt, thus earning itself a £31 million fee and, it lavishly promised, leaving a couple of million over for the NHS.
This, according to the NAO, would equate to year-on-year savings in excess of 5% – something that no hospital anywhere in the world has even come close to achieving.
On top of the £31 million Circle hopes to make out of the ten-year deal, the contract allows for them to keep the first £2 million of any surplus it makes plus a further percentage of any other profits.
Six months into the contract and it is clear that not all is going to plan for Circle.
Instead of the loss they predicted at the end of the first six months of £1.9 million, they actually lost £4.1 million.
This will come as a shock to those who rely on the bourgeois media for the truth – in August the press was awash with stories claiming that Circle had ‘turned around’ a failing NHS hospital and that it represented the acceptable face of privatisation after the disasters of G4S.
Now, however, the truth is emerging. Despite huge cuts in staffing (according to Unison, between 270 and 300 jobs have gone and several wards are lying empty) Circle are racking up debts and being forced to go back to its private equity backers who funded the entire privatisation grab, and borrow a further £4 million because of ‘cash-flow problems’ – that is, to stop them going bust and collapsing in much the same way as Southern Cross, the private home care company, did recently
As for turning the hospital around clinically, it turns out that while Hinchingbrooke was previously rated as ‘excellent’ under the NHS, it is now only mediocre on the scale of patient satisfaction.
What the NAO report also uncovered was that under the terms of the deal it is not actually necessary for Circle to pay off the debt before it can strip profit out of the hospital – as soon as it just balances the books for a year it can start taking money out of the NHS; the debt only has to be repaid if it makes a profit of £2 million a year.
This target is impossible to meet except by completely transforming Hinchingbrooke, closing down expensive units like A&E, maternity and paediatrics and concentrating entirely on the more profitable services – in short, turning it into a fully private hospital dealing with non-urgent but profitable treatment.
Both Unison and the Labour Party have denounced Hinchingbrooke as a ‘failed’ experiment in privatisation.
This misses the point – far from being a failure it is a lesson to the government and its privateer friends that to make a profit out of hospitals it is necessary to completely privatise them, slash staff to the bone and do away with any service that costs money, no matter how vital it is.
The only way to stop this destruction of the NHS is to kick out the government and put an end to the privateers once and for all by bringing in a workers government and socialism.
