Norfolk's PFI Hospital Scandal

12.16.25pm BST (GMT +0100) Tue 28th Mar 2006

How will healthcare in Norfolk be affected?

Up to 700 jobs could be lost at the PFI Norfolk & Norwich University Hospital due to the cost of repayments.

Norfolk is paying well over the odds for the £229 million N&N, with repayments to the private financiers totalling nearly £38 million a year. The eventual cost of the hospital will be over £1 billion.

Now we learn that the Hospital has a £22 million shortfall this year, hence the threat to jobs. Savings will have to be made somehow, but at what cost to the quality of public health care in Norfolk?

The Norfolk & Norwich was one of the first to be built using PFI, and Norfolk has been paying the price for being one of the early experiments in this form of funding. It now transpires that so called 'smoothing payments' from the government that were supposed to address the extra costs of using private finance over the 30 year contract of the N&N are now coming to an end in one year's time.

There also seems to be some confusion in government thinking: on the one hand we hear of massive hospital building projects; and on the other we hear that more healthcare currently provided by hospitals should now be provided in communities. If the N&N is not operating at full capacity, then that will be another major impact on its finances.

Norfolk MPs Norman Lamb and Ian Gibson have set up an all-Norfolk Parliamentary Committee to help the hospital tackle this crisis. The government must listen to what it will have to say.