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Last Updated: Friday, 10 June, 2005, 03:18 GMT 04:18 UK
High price for PFI deal concerns
Norfolk and Norwich University Hospital
Norfolk and Norwich University Hospital was financed through a PFI
Healthcare in Norfolk is paying a high price for building its key hospital through a pioneering Private Finance Initiative (PFI), a report says.

The National Audit Office suggests the PFI deal to build the Norfolk and Norwich NHS Hospital cost a premium price because it was one of the first.

Lib Dem MP for North Norfolk Norman Lamb called on the government to help clear the hospital's debt.

He said this was caused by the hospital pioneering the PFI deal.

Mr Lamb said: "The building of this hospital has had a massive impact on the local health economy, leaving it deeply in the red.

Norman Lamb MP
The report highlights the need for more work to be done to make PFI deals better value for tax payers
Norman Lamb, MP for North Norfolk

"The government should help clear the current deficit to ensure that this 35-year contract does not have a negative impact on patients.

"The report highlights the need for more work to be done to make PFI deals better value for tax payers."

Anna Dugdale, the Norfolk and Norwich NHS Hospital trust's director of resources, said paying a premium price has been worth it in terms of patient care.

She said if the hospital has not been financed through a PFI scheme "our patients and public would have missed out on the huge advantages that they have had by having a world-class facility in Norwich".

Dave Prentis, general secretary of Unison, said shares in PFI hospitals were being traded by people who "didn't care about patients or hospitals".

He said the nature of PFI financing also meant that the public was kept in the dark about "who actually owns" hospitals.

'Successful project'

The National Audit Office report said that a refinancing deal arranged at the hospital in 2003 - two years after it opened - generated large amounts of money for business consortia, Octagon.

The report said the Department of Health should carry out further analysis into how the pricing of PFI deals has changed since they first came into operation.

The Department of Health told the BBC: "We are pleased that the NAO has again found that PFI projects deliver value for money for the NHS.

"The Norfolk and Norwich University Hospital PFI scheme is a successful project and has demonstrated value for money. The hospital opened to patients ahead of schedule and on budget.

"The refinancing has delivered real gains for the NHS. The Trust is now paying 1.7m less in annual fees, amounting to a total of 34m in today's money."


SEE ALSO:
Hospital looks for 15m of cuts
30 Jul 04 |  Norfolk
Trust's chief executive departs
28 May 04 |  Norfolk
Norfolk hospital gets new chief
27 Sep 02 |  England


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