NHS leader calls for private sector partnerships to build new hospitals | Hospitals

The NHS must be given the green light to work with private healthcare firms and developers to build new hospitals and reduce the backlog of care, a health chief has said.

The last Labour government was widely criticised for its controversial private finance (PFI) deals to build many new NHS sites, which resulted in huge profits for large corporations.

But in a major intervention, the head of NHS Providers, Julian Hartley, has called on the next administration to relax Treasury rules that restrict health trusts in England from entering into such collaborations, and insisted the NHS has “nothing to fear” from them.

He said: “We need to think outside the box when it comes to tackling this twin challenge of under-stretched public finances and an NHS in urgent need of renewal.

“Working with public and private partners such as ethical pension funds, property developers, universities, private healthcare providers and local councils can open up opportunities for NHS trusts looking to build new hospitals or redevelop existing facilities that have been constrained by rigid Treasury rules.”

But Dr John Puntis, of Keep Our NHS Public, said most people would find his suggestion “appalling” and that it was a “shocking attack on the founding principles of the NHS”, which will celebrate its 76th anniversary on Friday.

Hartley cited recent partnerships between NHS trusts in Birmingham and Surrey and private healthcare providers to run newly built facilities that treat NHS and fee-paying patients as “successful examples of the NHS and the private sector working together. We can take positive lessons that this can be done, that the NHS and the private sector can work together and that it supports the interests of NHS services.”

“It doesn’t have to be PFI Two. This is not about privatising the NHS; it is about strengthening and supporting the NHS through investment that creates better facilities for patients,” Hartley added.

University Hospitals Birmingham (UHB) trust has been given operational control of 72 of the 122 beds at the private Harborne Hospital on its site, which opened in January under a partnership between it and HCA, a major US healthcare company that runs a chain of private hospitals in the UK. UHB did not contribute to the £100m cost of building the hospital, which provides cancer, cardiology and orthopaedic care, but has leased two of the eight floors for its own patients.

The extra beds will allow people in Birmingham and Solihull to receive faster treatment “in world-class facilities, delivered by leading NHS specialists” by reducing waiting lists, the statement said.

In a similar move, Royal Surrey NHS Trust and Genesis Cancer Care have reached an agreement to run a new dedicated cancer centre, which opened in Guildford, Surrey, in March. The £30m facility will provide oncology and radiotherapy to NHS and private patients.

Hartley has urged the chancellor and health secretary to “keep an open mind” about linkages with the NHS involving large injections of capital from pharmaceutical companies, pension funds and universities after the UK general election. The new government should see the new wave of hospitals that will come as a boost to the economy and a way for the public sector to tap into private sources of finance at a time when government spending is likely to remain constrained, he said.

It wants the Treasury to review the Department of Health and Social Care’s Departmental Capital Expenditure Limit (CDEL), which limits how much health and NHS trusts can spend on capital projects, even if some of the money comes from outside sources. The backlog of repairs needed in the NHS in England has risen to £11.6bn in recent years.

Keir Starmer and shadow health secretary Wes Streeting have said that under a Labour government the NHS will draw on the private sector as much as possible to reduce the backlog, which has risen to 7.6 million procedures. Acting on Hartley’s idea would risk angering those who fear the privatisation of the NHS.

Hartley highlighted that many NHS trusts were unable to rebuild or replace sometimes dangerously dilapidated sites when, of 100 that applied to join the New Hospitals Programme, a plan to implement then-Prime Minister Boris Johnson’s pledge to build “40 new hospitals by 2030”, only 40 were given the go-ahead because admissions were limited.

David Hare, chief executive of the Independent Healthcare Providers Network, which represents private healthcare providers, said: “There is a huge demand from the independent sector to work with the NHS and provide much-needed new capital, capacity and capabilities to support improved patient access to NHS services free at the point of use.”

But David Rowland, director of the Centre for Health and the Public Interest, a think tank, warned that NHS/private partnerships would “accelerate a two-tiered healthcare system”. He accused Hartley of being “astonishingly naive” in his approach to the “for-profit sector, particularly those with private equity”. Such companies are only interested in the NHS “to exploit highly skilled NHS staff to treat those patients who can afford to pay privately and skip the queues.

“The last Labour government believed that getting into bed with the private sector to fund, build and run NHS hospitals under a PFI scheme would bring investment and expertise. In reality, it has led to huge amounts of money leaking out of the NHS in the form of profits and has burdened NHS Trusts with huge, crippling debt repayments.

“The mistakes that resulted from this disaster should not be repeated.”