THAT NHS hospitals cannot pay back the huge multi-million Private Finance Initiative (PFI) ‘debt’ to the banks is well known.
The coalition government and its Health Secretary Andrew Lansley have begun to weep crocodile tears at this situation and have announced that 22 PFI NHS trusts are on the brink of bankruptcy and may not be able to continue.
There are at the moment 103 PFI deals, priced at £11.4bn, for which the NHS will have to pay back £80bn over the period of the lease, over some thirty years.
The PFI was begun under the Major Tory government. The policy was seized upon by New Labour leaders Brown and Blair as a magical way of making their friends the bosses and the bankers very rich, while at the same time postponing full payment, and keeping the huge sums involved off of government spending estimates.
Under the plan, the banks lent big business the cash to build the hospitals, which they then leased to the NHS over 30 years making a gigantic profit in the process, as massive interest payments accumulate, while the value of the projects decreases.
The leasage payments are index linked to inflation, so these have been rocketing upwards, while the NHS budget to the various hospitals is not – meaning that the crushing debt load is rising rapidly at the same time as the NHS is being forced to make £20bn in cuts.
The coalition government is now saying that 22 NHS trusts are in immediate crisis, around a fifth of the total PFI NHS schemes. However, the number is expected to grow since repayments account for up to 20 per cent of the PFI NHS trust budgets.
Department of Health figures show yearly bills are forecast to rise by 75% to more than £2.5bn in the next 18 years, because of inflation and the way the deals are structured.
This means that when the last scheme signed off by Labour is paid in full – in 2049 – up to £80bn will have been handed over.
At the same time as this process is under way, the coalition is set to close scores of hospitals as health minister Paul Burstow made clear at a LibDem fringe meeting this week. At it he welcomed the decision to close Chase Farm and revealed that the coalition was poised to unleash a ‘wave of reconfiguration decisions’, ie hospital closures.
Health minister Lansley, complete with crocodile tears, has sought to blame Labour for the PFI crisis. He intends to use this crisis to assist in organising the ‘wave’ of closures of NHS facilities and hospitals, arguing that NHS resources will have to be switched to keep many of the PFI schemes going.
In order for the contracts with the bankers to be kept, NHS hospitals and facilities everywhere will have to be closed ‘in waves’.
David Stout of the NHS Confederation, which represents health managers, said yesterday: ‘We do need to look at how we remunerate hospitals for their care, and if a hospital has high costs the government I think is right, and we would support this, the government does need to look at how we ensure they get the right amount of money to run that care.
‘We don’t want the care to be closed simply because of the cost of PFI, that would be foolish.’
They just want everything else closed to pay the PFI bankers!
The News Line calls for the defence of all NHS hospitals and all NHS facilities. They must all be kept open. We call for them all to be occupied by workers, patients and the trade unions to stop them from being closed.
We demand the trade unions call a general strike to bring down the coalition, and bring in a workers government. This will rip up the PFI contracts and get the cash back from the banks through expropriating the bosses and bankers and bringing in socialism.
