PFI Liabilities

Oral Answers to Questions — Health – in the House of Commons at 12:00 am on 21 March 2017.

Alert me about debates like this

Photo of Tim Loughton Tim Loughton Conservative, East Worthing and Shoreham 12:00, 21 March 2017

What the estimated cost of private finance initiative liabilities to the NHS is in (a) 2016-17 and (b) the subsequent three financial years.

Photo of Philip Dunne Philip Dunne The Minister of State, Department of Health

Labour’s legacy cost from the 103 hospital PFI schemes entered into between 1997 and 2010 was a public sector liability of £77 billion. The estimated total NHS PFI payments for the financial year ending at the end of this month is £1.97 billion, and the totals for the next three financial years are £2.04 billion, £2.11 billion and £2.16 billion.

Photo of Tim Loughton Tim Loughton Conservative, East Worthing and Shoreham

Those are alarming figures, so what are the Government doing to support the trusts affected by those expensive and inflexible PFI and other deals reached under the previous Labour Government? What assessment has the Minister made of what the funds could be buying in the NHS now if it was not saddled by this Labour debt legacy?

Photo of Philip Dunne Philip Dunne The Minister of State, Department of Health

My hon. Friend is right to point out that the Opposition constantly complain about the cost of the PFI programmes that they themselves initiated. The Government are making large efforts to support trusts in dealing with the PFI legacy. We are giving the seven trusts worst affected by PFI schemes access to a £1.5 billion support fund over a 25-year period. In 2014 alone, trusts negotiated savings worth over £250 million on their contracts.

Photo of John Pugh John Pugh Liberal Democrat Spokesperson (Education)

On the subject of financial liabilities, what assessment has the Department made of the potential effect of changes to the discount rate on the amount of compensation paid out by the NHS Litigation Authority?

Photo of Philip Dunne Philip Dunne The Minister of State, Department of Health

The Department is urgently undertaking work to understand what the impact on the NHS will be. There have been regular meetings with the NHS Litigation Authority since the announcement. The Government will adjust the NHSLA’s budget to meet the additional costs associated with the change in the discount rate.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

PFI always was idiotic. It carried on under the coalition Government and has left a huge financial hangover. Will the Minister have a word with his colleagues in the Treasury, because the Treasury figures on hospital liabilities are different from the figures that some of the hospitals themselves produce? As there is a discrepancy, we do not even know what the liabilities are.

Photo of Philip Dunne Philip Dunne The Minister of State, Department of Health

The hon. Gentleman has been assiduous, as is his wont, in trying to get to the bottom of the costs of the PFI impact on the hospital in his area. If he has a discrepancy, it would be very helpful if he pointed it out to me in writing. I will then respond to him.

Minister

Ministers make up the Government and almost all are members of the House of Lords or the House of Commons. There are three main types of Minister. Departmental Ministers are in charge of Government Departments. The Government is divided into different Departments which have responsibilities for different areas. For example the Treasury is in charge of Government spending. Departmental Ministers in the Cabinet are generally called 'Secretary of State' but some have special titles such as Chancellor of the Exchequer. Ministers of State and Junior Ministers assist the ministers in charge of the department. They normally have responsibility for a particular area within the department and are sometimes given a title that reflects this - for example Minister of Transport.

Opposition

The Opposition are the political parties in the House of Commons other than the largest or Government party. They are called the Opposition because they sit on the benches opposite the Government in the House of Commons Chamber. The largest of the Opposition parties is known as Her Majesty's Opposition. The role of the Official Opposition is to question and scrutinise the work of Government. The Opposition often votes against the Government. In a sense the Official Opposition is the "Government in waiting".