Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The UK government should consider the use of private capital to fix the NHS’s crumbling buildings and infrastructure, the head of England’s health service has said.
NHS England chief executive Amanda Pritchard called for a more “radical” approach in a significant intervention as the service grapples with the highest maintenance backlog on record.
“We need to think much more radically, particularly about capital,” Pritchard told the BBC on Thursday. “I think we now must consider private capital investment in the NHS.”
She added that the service would struggle to deliver long-term improvements unless it fixed its buildings and outdated technology.
The comments add to calls for the government to reverse a ban on using private finance to fix what health leaders have described as a “broken” capital investment system that has left the service with dilapidated estates.
Private finance initiative schemes were dropped for central government in 2018 after hospitals, schools and local authorities struggled to cope with large debt repayments and a National Audit Office report warned they were poor value for money for taxpayers.
However, several local authorities have continued to launch PFI schemes, while a handful of public-private partnerships in Wales are being delivered under the Mutual Investment Model.
A government-commissioned review last year found England had spent £37bn less than peer countries on health assets and infrastructure between 2010 and 2020.
This shortfall forced the health service to raid capital budgets in order to manage day-to-day spending, leaving it with crumbling buildings and an accumulated maintenance backlog of £13.8bn.
In a report on Tuesday, the NHS Confederation called on the UK government to emulate a Welsh government initiative to expand private sector involvement in the development of health infrastructure.
Private investment in the health service’s estate could include PFIs, third-party development and buyback, as well as mutual investment models, infrastructure and investment partnerships.
Matthew Taylor, chief executive of the NHS Confederation and a former Labour party strategist, said: “It is welcome to see NHS England is heeding the call we have already made on behalf of NHS leaders to consider filling the health service’s capital investment hole by looking at whether private investment could once again have a role to play in helping to regenerate some of its vast estate and infrastructure.”
He added that the NHS “urgently” needs more options for the renovation of its dilapidated buildings and outdated technology. “To be clear this is not about bringing back the old PFI model, we need to develop something new, fit for the future and something which truly offers value for money.”
The Department of Health and Social Care did not immediately respond to a request for comment.
