The Labour Government couldn't afford to do everything they wanted to do, so they came up with a complex financial scheme to pay for things. They were known as Private Financial Initiatives or PFI schemes. They aren't working.
Under the PFI deals, a private contractor builds a hospital or school. It owns the building for up to 35 years, and during this period the public sector must pay interest and repay the cost of construction, as well as paying the contractor to maintain the building.The result? Non-emergency surgeries are being "delayed." If you aren't bleeding to death, you are gonna wait. Those bad knees? That hip? The gall bladder that is giving you grief? None of those constitute an emergency. Then there is the "goal" - that Dear Leader shares - of having all health care on one computer system. There doesn't appear to be much evidence it actually works.
However, the total cost of the deals is often far more than the value of the assets. As a result, Mr Lansley says, the 22 trusts "cannot afford" to pay for their schemes, which in total are worth more than £5.4billion, because the required payments have risen sharply in the wake of the recession.
It also emerged last night that the Coalition was expected to announce it is abandoning Labour's calamitous £12billion NHS computer scheme. Ministers will dismantle the National Programme for IT, a "one size fits all" project started in 2002 which has never worked, and replace it with regional schemes.12 billion pounds (about 27.6 billion dollars at today's exchange rate) would pay for a lot of surgeries, hospitals, doctors, whatever. But spending to get everyone to march in Lock-step is the statist way. Bureaucrats love it when everyone does just exactly what they are told.
Earlier this year, John Healey, the shadow health secretary, admitted in an interview that Labour ministers had failed when negotiating the multi–million pound schemes for hospitals. "There is definitely a case for saying we were poor at PFI, poor at negotiating PFI contracts at the outset," he said.But what do you expect when they are not spending their money, but the unending tax dollars. As an example, some of the deals gave the private interest 71% return on investment. Pretty awful stewardship of the public funds. (And of course none of the contracts went to anyone's brother-in-law, or financial supporter or anything, I'm sure. That kind of thing only happens with Chicago politicians.) I can't wait until we have socialized medicine.