NHS - new 'surplus' but problems continue

On the 3 November Save the NHS march, photo Paul Mattsson

THE NHS's chief executive David Nicholson has admitted that overall, the service will have underspent by £1.8 billion by the end of this financial year. Health unions and campaigners are furious.

Keith Carter

According to research by Health Emergency, 3,000 hospital beds and 25,000 staff were cut in the past 18 months of redundancies, hospital and ward closures and cutbacks. On top of that, NHS staff were offered a derisory pay award for keeping the service going over this crisis period.

But the 'surplus' certainly does not mean that the cash crisis is over. Many hospital trusts, for example, are still in serious financial difficulties and the latest projections of government health spending are of a severe slowdown in the rate of increase in NHS funding.

On the 3 November Save the NHS march, photo Paul Mattsson

The problems can be seen very sharply in the government's flagship private finance initiative (PFI) hospitals. Up to ten ambulances have been forced to queue outside the first PFI hospital, Norfolk and Norwich University, as its wards filled to bursting point. Paramedics were forced to treat patients in the back of the vehicles.

This acute lack of capacity is linked to PFI. The rebuilt hospital opened in 2001 with 987 beds compared to 1,120 before PFI.

The Norfolk and Norwich Hospital PFI scheme was refinanced at a lower borrowing rate, making the private sector consortium involved, Octagon, £115 million profit and increasing their rate of return from 16% to 60%! The NHS Trust only received back £34 million.

In 2006, the House of Commons public accounts committee released a report accusing the private Octagon consortium of "lining investors' pockets" and putting the trust at increased risk of further losses. Even MPs dubbed the scheme the "unacceptable face of capitalism".

By 2013/14 when all the NHS PFI schemes in Britain are in force, then the NHS will be paying back £2.3 billion each year into the PFI bosses' 'unacceptable' bank accounts.

For these sharks, profits count far higher than patients' welfare. Not a penny more of public money should go to big business profiteering out of the NHS.