PFI deal costs Woolwich hospital millions

4.00.00pm UTC (GMT +0000) Sun 18th Dec 2005

The Private Finance Initiative (PFI) scheme which funded the construction of the Queen Elizabeth Hospital (QEH) in Woolwich was so badly structured that the hospital is technically bankrupt, according to recent reports.

An audit report from PricewaterhouseCoopers estimates that the hospital's deficit will reach almost £20m this year and will go on rising.

"The Labour government have been obsessed with getting private finance into the NHS," says Lib Dem health spokesperson Cllr Brian Woodcraft (Middle Park & Sutcliffe). "Often this has been at the expense of getting a good deal.

"The QEH is locked into a PFI deal which means it pays £9m a year more than if the project has been funded by the government."

Cllr Woodcraft concluded "The government must take action quickly to find a long-term solution. If these debts continue to rise, it will soon impact on the hospital's services to the general public which would be damaging to the local community in the borough."