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GWH meets more financial turbulence - PFI payments take their toll

For whatever political reason, the impact of PFI contract payments on NHS hospitals is being 'highlighted nationally'.  Private Finance Initiatives - or PFIs - have provided private funding to build projects for the public sector - often with steep interest charges as well as inflation clauses.

PFIs have been popular with governments as they do not count as public spending. They are certainly one of the reasons the GWH board was told last week that a 'recovery programme' was needed and staff would be told about the problems.


At present the hospital Trust's deficit is standing at about £2million.   It may shrink if extra payments from central funds are not reduced when targets - notably the emergency department 4-hour wait target - are breached.

Director of Finance, Karen Johnson:  "I feel we can manage.  I am fairly confident about short-term fixes, but I am concerned about next year."  The short-term fixes may, later in the year, include a cash loan from central NHS funds.

GWH's Chief Executive, Nerissa Vaughan pointed straight at the PFI payments:  "We've reached the point when the PFI is now a significant issue."

And Mrs Johnson indicated that a recent investigation of the PFI contracts had found their charges were £8-12million higher than normal financing charges:  "Unless the PFI charges are reduced, this [Hospital] Trust will never be out of a deficit position."

At present PFI payments eat up about ten per cent of GWH's annual income.

Apart from the PFI issue, where have costs increased to blow the GWH budget off course?  In August, all areas of pay - staff, agency, the hospital's own reserve or 'bank' of nurses, and locums - were above budget.  And over the year to the end of August these costs were above budget by £2,925,000.

There is one glimmer of light that may ease these costs.  It is expected that the Nursing and Midwifery Council will very soon announce that a new and more appropriate language test for nurses recruited from the EU and beyond will be brought in.  

As marlborough.news has reported, the tests are very difficult and some of these recruits are working below their skill level because they have not passed the test - and agency nurses have to be rostered in their place.

The money for social services the Chancellor of the Exchequer announced in his spring budget - £2billion over three years - seems to have run into the sand.   Wiltshire's share was added to the Better Care Fund.  It has not yet improved the flow of patients through GWH.

The numbers of patients remaining in beds when they should be leaving hospital (delayed transfers of care or DTOCS) continue to rise - adding costs to hospitals and, at the front door, delaying the admittance of patients from A&E.

In August Wiltshire DTOC patients cost GWH 404 bed-days - that was 14 per cent up on July, but 149 per cent up on August 2016: "Waits for community hospital beds have been challenging in August, together with waits for Homefirst - the service delivered by health services in Wiltshire in people's own homes."  They expect better figures for September.

In August Swindon patients ready to leave GWH accounted for 575 lost bed-days - down seven per cent on July, but up 76 per cent on August 2016.  (See below for further information on DTOCs.)
 
FOOTNOTE:  At the moment GWH has three PFI contracts to pay for:

The main contract for the hospital itself (and its adjoining staff accommodation) runs until 2029 and is in two parts - the major part of the contract is for occupation of the building itself.  Under the same contract are the charges levied for maintenance of the building and services such as cleaning, catering, switchboards etc.

GWH also have a PFI contract with System C for the hospital's 'Integrated Clinical Information System'.  This was due to expire in 2013, but has been extended to 2020 and now includes updated systems.

Thirdly, GWH have been responsible for the Savernake Hospital PFI contract since the whole building was transferred to them when the Primary Care Trust was dissolved (1 April 2013.)  

However, Savernake Hospital is being taken over by the central NHS Property Service company.  Soon GWH's payment for use of Savernake Hospital will become rent for the space they occupy - while the PFI contract runs on until 2034.

 

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  • Marlborough-2013-04-18 St Peters
  • IMG 9097
  • IMG 8472
  • Silbury-Sunset---10-06-08-----07
  • Town-Hall-2011-05-03 08-