Press release on behalf of Keep Our NHS Public - statement by Co-Chair, retired paediatrician Dr Tony O'Sullivan and Secretary/health policy academic Dr John Lister
Government's hospital buildings programme is smoke and mirrors - Analysis
34 out of the ‘40 new hospitals’ announced by Boris Johnson in time for the Conservative Party conference yesterday, are in fact existing hospitals which are being given only £100 million between them for repairs; in fact there is a £6 billion deficit in new building, repairs and equipment. Johnson claimed to be 'announcing' 40 hospitals, but almost at once it became clear only six of the projects are to start now. The remainder may never happen at all: 21 more schemes (one of which is for up to 12 small community hospitals – hence the inflated numbers) will not be funded or begin until at least 2025.[See also BBC News]
The misleading promise of a ‘capital injection’ has to be set against the current £6bn deficit. Even then, the money is over 5-10 years. Coming in two waves (ripples compared to what is needed) £2.7bn is said to rebuild six hospitals by 2025, so these are not new as has been claimed.
The 21 schemes that are being deferred are to share a mere £100m 'seed money' to begin thinking about the new hospitals in six years time: but the use of this term raises questions over how these additional projects are to be funded. Seed funding is normally followed by seeking the remainder of the cash from various banks and other sources but at the end of last year Philip Hammond announced the government would sign off no more projects funded through the Private Finance Initiative. We now have a new chancellor, but no declaration so far of a new policy: without it, we are likely to have no money and no new hospitals.
Successive governments have starved the NHS of funding for nearly 10 years - by over 25% - an over £30 billion shortfall in annual funding. With no new revenue funding, hospitals will not have the funds to provide services. In addition, all capital funds to the NHS, incur 3.5% interest charges under the ‘public funding payback’ scheme, annually in perpetuity for capital builds. Trusts are already in debt to the Treasury to the tune of £14bn to stave off bankruptcy and have to pay interest charges on this too.
NHS Providers, which represents NHS and foundation trusts, has been running a campaign for a big increase in capital spending. Its chief executive Chris Hopson argues that the allocation of £2.7bn, averaging of £400-500m per hospital, for 6 hospitals that “need rebuilding and already have full business cases” seems to be “full new schemes." But the government has not so far said how much capital is to be allocated to the NHS after 2021, so while ministers claim the £2.7 billion will be “extra” there is less certainty.
Unless we see confirmation, the £2.7 billion could simply be taken from baseline funding. The government is already facing stiff questions from the Office for Statistics Regulation over what turned out to be misleading claims by ministers that £1.8 billion of capital funding announced by ministers back in August was genuinely new money, when most of it was simply the release of money already in trusts’ accounts.
Even if the £13 billion turns out to be real money for real hospital schemes, the other obvious question being widely asked is, what are the plans to deal with the other NHS capital needs (e.g. mental health, community, ambulance, digital, and the £6 billion backlog maintenance)?
The Health Foundation has argued that the NHS needs £3bn each year for the next 5 years to upgrade crumbling buildings and replace outdated equipment, but there is no significant money for backlog maintenance - and only £200m compared with the £1.5bn the Health Foundation argues is needed to bring scanner numbers up to EU average.
While £13 billion is allegedly coming for shiny new hospitals, mental health services are promised a measly £70m for 12 mental health pilot areas, with the NHS seeking help from charities and local councils. After thousands of mental health nursing posts have been lost, Johnson now promises to recruit “about 1,000 extra specialist staff” to the pilot sites.
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For media enquiries please contact Samantha Wathen on 07776047472 or email us at [email protected]
Spokespeople are available for broadcast interview.
Government's hospital buildings programme is smoke and mirrors - Analysis
34 out of the ‘40 new hospitals’ announced by Boris Johnson in time for the Conservative Party conference yesterday, are in fact existing hospitals which are being given only £100 million between them for repairs; in fact there is a £6 billion deficit in new building, repairs and equipment. Johnson claimed to be 'announcing' 40 hospitals, but almost at once it became clear only six of the projects are to start now. The remainder may never happen at all: 21 more schemes (one of which is for up to 12 small community hospitals – hence the inflated numbers) will not be funded or begin until at least 2025.[See also BBC News]
The misleading promise of a ‘capital injection’ has to be set against the current £6bn deficit. Even then, the money is over 5-10 years. Coming in two waves (ripples compared to what is needed) £2.7bn is said to rebuild six hospitals by 2025, so these are not new as has been claimed.
The 21 schemes that are being deferred are to share a mere £100m 'seed money' to begin thinking about the new hospitals in six years time: but the use of this term raises questions over how these additional projects are to be funded. Seed funding is normally followed by seeking the remainder of the cash from various banks and other sources but at the end of last year Philip Hammond announced the government would sign off no more projects funded through the Private Finance Initiative. We now have a new chancellor, but no declaration so far of a new policy: without it, we are likely to have no money and no new hospitals.
Successive governments have starved the NHS of funding for nearly 10 years - by over 25% - an over £30 billion shortfall in annual funding. With no new revenue funding, hospitals will not have the funds to provide services. In addition, all capital funds to the NHS, incur 3.5% interest charges under the ‘public funding payback’ scheme, annually in perpetuity for capital builds. Trusts are already in debt to the Treasury to the tune of £14bn to stave off bankruptcy and have to pay interest charges on this too.
NHS Providers, which represents NHS and foundation trusts, has been running a campaign for a big increase in capital spending. Its chief executive Chris Hopson argues that the allocation of £2.7bn, averaging of £400-500m per hospital, for 6 hospitals that “need rebuilding and already have full business cases” seems to be “full new schemes." But the government has not so far said how much capital is to be allocated to the NHS after 2021, so while ministers claim the £2.7 billion will be “extra” there is less certainty.
Unless we see confirmation, the £2.7 billion could simply be taken from baseline funding. The government is already facing stiff questions from the Office for Statistics Regulation over what turned out to be misleading claims by ministers that £1.8 billion of capital funding announced by ministers back in August was genuinely new money, when most of it was simply the release of money already in trusts’ accounts.
Even if the £13 billion turns out to be real money for real hospital schemes, the other obvious question being widely asked is, what are the plans to deal with the other NHS capital needs (e.g. mental health, community, ambulance, digital, and the £6 billion backlog maintenance)?
The Health Foundation has argued that the NHS needs £3bn each year for the next 5 years to upgrade crumbling buildings and replace outdated equipment, but there is no significant money for backlog maintenance - and only £200m compared with the £1.5bn the Health Foundation argues is needed to bring scanner numbers up to EU average.
While £13 billion is allegedly coming for shiny new hospitals, mental health services are promised a measly £70m for 12 mental health pilot areas, with the NHS seeking help from charities and local councils. After thousands of mental health nursing posts have been lost, Johnson now promises to recruit “about 1,000 extra specialist staff” to the pilot sites.
[ends]
For media enquiries please contact Samantha Wathen on 07776047472 or email us at [email protected]
Spokespeople are available for broadcast interview.