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Hospital Services Saved – plus Q&A on Labour’s PFI project 4 January 2014

Posted by George Crozier in Uncategorized.
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This is a slightly extended version of a story which appears in the latest Forest Hill Focus

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Forest Hill Councillor Alex Feakes (holding banner) and Lewisham Group Leader Chris Maines (left) were among the local Lib Dems who joined other local residents to march in support of the campaign to save hospital services

Local people are celebrating victory in the fight to save vital services at Lewisham Hospital. The final victory came on October 29th when the Court of Appeal upheld the High Court’s judgment in July that Conservative Health Secretary Jeremy Hunt did not have the power to downgrade Lewisham’s A&E and Maternity units.

Lewisham councillors from all parties had joined together to back the move to take the Health Secretary’s decision to judicial review. Forest Hill’s Lib Dem councillors Alex Feakes and Philip Peake were among thousands of local residents who marched in support of the campaign to save hospital services.

Commenting on the Court of Appeal decision Alex Feakes said: “This is a victory for common sense. The strength of the local campaign has been tremendous. It shows how much we value our local services and what we can achieve when we come together as a community.”

Q&A: Labour’s PFI bankrupted NHS Trust

It was part of a bid to save the bankrupt South London Healthcare NHS Trust (SLHT) which runs hospitals in Woolwich and Orpington. Closing Lewisham’s A&E and Maternity departments and sending patients to Woolwich instead was meant to help SLHT financially.

Why was South London Healthcare bankrupt?

SLHT was losing £1 million a week mainly because of payments under a Private Finance Initiative (PFI) contract signed under the last Labour Government for the rebuilding of two of its hospitals. The contract tied the Trust in to ruinous annual charges every year until 2032. The Department of Health has already spent more than £1 billion bailing out Trusts struggling with PFI charges.

Why were the contracts signed?

Labour’s eagerness to keep vast amounts of debt ‘off the government books’ led to PFI being the ‘only game in town’. They failed to rigorously negotiate contracts and get value for money. As a result finance companies – some of them based in tax havens – have pocketed huge profits whilst hospital trusts have been locked into unaffordable contracts putting them on the brink of bankruptcy.

What can be done?

The Coalition Government has announced reforms to PFI to make it fairer and deliver better value for money. Among other things these would give the public sector a share of profits from future projects. But more needs to be done about existing contracts. Lewisham Lib Dems proposed a motion (see http://ow.ly/r8Akg) at September’s national Lib Dem conference calling for the Government to assist Trusts in robust renegotiations of PFI contracts. This is now the national party policy.

Is renegotiation realistic?

Yes. Commercial contracts are often renegotiated in the private sector. A cross party group of more than 70 MPs are campaigning for a rebate from PFI providers.

What has happened to South London Healthcare?

The Trust was dissolved in September. Queen Elizabeth Hospital in Greenwich is now part of a new Lewisham and Greenwich NHS Trust with Lewisham Hospital. However the Trust is not inheriting any historic debts from South London Healthcare and additional financial support is being provided by government to help with Queen Elizabeth Hospital’s PFI debts.