Circle Health, the privateer which was handed control of Hinchingbrooke District General Hospital in Cambridgeshire last week, has admitted that patient care could suffer as a result of its policies.
In its ‘share prospectus’, which was published in June, the privateer admitted that its ambition to further expand into the NHS ‘could affect its ability to provide a consistent level of service to its patients’.
Labour and trade union leaders yesterday warned of the threat of a Southern Cross-style NHS collapse resulting from privatisation.
Circle Health, run by a former Goldman Sachs banker, was awarded management of Hinchingbrooke Hospital by the Tory-LibDem coalition government last week.
In its document, Circle Health says: ‘As well as the establishment of further independent hospitals, Circle intends to significantly expand its NHS business.
‘Circle’s growth has placed, and its anticipated growth will continue to place, a strain on its managerial, administrative, operational, financial, information technology and other resources and could affect its ability to provide a consistent level of service to its patients.’
Circle Health will manage the Hinchingbrooke Hospital from February, after the government approved a decade-long contract worth £1 billion and will make a profit if the hospital, which is £40 million in debt, achieves an ‘annual surplus’, which the company says it hopes to achieve through a ‘new management style’ and ‘cost-cutting’.
Circle Health’s latest accounts show an operating loss of £4.97 million.
Circle Health is backed by City hedge funds run by Crispin Odey and Paul Ruddock, who have donated £790,000 to the Conservative Party.
Shadow Health Secretary, Andy Burnham, said: ‘The more we learn about this deal, the more we hear worrying echoes of Southern Cross.
‘It will not fill people with confidence to hear that, by its own admission, this company has doubts about whether it can meet the continuity of service and consistency of care that is essential in the NHS.
‘In their desperation to open up the NHS to the private sector, it seems ministers are taking an unacceptable gamble with essential services.’
A Unison spokesman told News Line: ‘It has been known some time that Circle has financial difficulties and the people who will suffer in the long term because of this will be patients.
‘We have campaigned long and hard to keep private companies out of the NHS because they are motivated by profit not by a need to care.
‘We have to beware that we don’t come into a similar situation as happened at Southern Cross, where the company made its profits and left the elderly residents there high and dry.’
BMA Council Member Anna Athow told News Line: ‘The main outlay of any hospital is staff wages and the only way Circle can make profits is by drastically cutting staff and the quality of those staff, or no longer providing services which do not make profit on tariff.
‘Circle will go to war on the unions and cut all the established norms of safe staffing, relying on the backing of the coalition government.
‘The unions have to fight this now and organise a general strike to get Circle thrown out, the Health Bill stopped and this government removed.’
