50 signatures reached
To: MPs, Government Ministers
Stop PFI Bankrupting the NHS
Ban and withdraw all PFI deals that can be legally withdrawn without excessive early closure fees. This is especially important to the NHS.
Why is this important?
This is especially important to the NHS.
The NHS gets a LOT of funding, plenty of funding to provide an excellent 24h 365 day service to millions.
BUT: A HUGE amount of this funding is syphoned off to "Private Finance Initiative" deals whereby a hospital that costs 1.34Bn to build is actually costing 10.32Bn via PFI repayments. This is the reason the NHS is so stretched,- the amount given by the treasury to the NHS is plenty for the service, but it its being massively wasted by epically badly planned government devised PFI deals whereby middle men and hedge funds make an absolutely (offshore) fortune from the fact they can charge anything (and do) and the government can't (legally or morally) give in and let hospitals go to waste.
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Why has this occurred?
The PFI deals came around from Gordon Brown as Treasury Cabinet Minister to allow the government to make massive expenses and to not declare them because they're actually "Private business" expenses, so the government says "Over the course of 10/25 years we will pay you an amount you want if you build this [hospital/airbase/whatever] for us right now.
The Businesses said "oooh yes!" and built what was asked and had a legal contract in place that the government would pay them back a net sum approximately (as illustrated above) of approximately ten times the build cost. Failure to pay back the costs (for example if voters forced government to renegotiate or void the contract) would also be covered by legally binding charges for ~8Bn, in the example above and rather than paid for over years that would be IMMEDIATELY REQUIRED.
So the government and the NHS is saddled with massive charges that are extortionate, just for build now, pay later hospital buildings.
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What we Can do:
We can not (as detailed above) void the current contracts, but we can push and force the government to remove PFI as an option for any future contracts for any public service, and also make government only take contracts where the costs are reasonable, and provable - as often PFI contracts where awarded by only being a few hundred pounds under the nearest competition offer - and then once awarded the contract costs "escalated".
Certain politicians (David Cameron, I believe) did promise to end PFI before taking office, but has now changed his tune - force him to keep his word. Force his successor to keep his word.
PFI is now widespread across the NHS and is the principle cause of shortage of funding, it is also getting a larger and larger hold in the UK Armed forces as well as other departments of government. We Must Stop It.
=====
Background reading:
This issue is well outlined in Private Eye 1383 page 10.
this issue is also very well explained in the Private Finance Initiative Special Report by Paul Foot in 2004.
The NHS gets a LOT of funding, plenty of funding to provide an excellent 24h 365 day service to millions.
BUT: A HUGE amount of this funding is syphoned off to "Private Finance Initiative" deals whereby a hospital that costs 1.34Bn to build is actually costing 10.32Bn via PFI repayments. This is the reason the NHS is so stretched,- the amount given by the treasury to the NHS is plenty for the service, but it its being massively wasted by epically badly planned government devised PFI deals whereby middle men and hedge funds make an absolutely (offshore) fortune from the fact they can charge anything (and do) and the government can't (legally or morally) give in and let hospitals go to waste.
=====
Why has this occurred?
The PFI deals came around from Gordon Brown as Treasury Cabinet Minister to allow the government to make massive expenses and to not declare them because they're actually "Private business" expenses, so the government says "Over the course of 10/25 years we will pay you an amount you want if you build this [hospital/airbase/whatever] for us right now.
The Businesses said "oooh yes!" and built what was asked and had a legal contract in place that the government would pay them back a net sum approximately (as illustrated above) of approximately ten times the build cost. Failure to pay back the costs (for example if voters forced government to renegotiate or void the contract) would also be covered by legally binding charges for ~8Bn, in the example above and rather than paid for over years that would be IMMEDIATELY REQUIRED.
So the government and the NHS is saddled with massive charges that are extortionate, just for build now, pay later hospital buildings.
=====
What we Can do:
We can not (as detailed above) void the current contracts, but we can push and force the government to remove PFI as an option for any future contracts for any public service, and also make government only take contracts where the costs are reasonable, and provable - as often PFI contracts where awarded by only being a few hundred pounds under the nearest competition offer - and then once awarded the contract costs "escalated".
Certain politicians (David Cameron, I believe) did promise to end PFI before taking office, but has now changed his tune - force him to keep his word. Force his successor to keep his word.
PFI is now widespread across the NHS and is the principle cause of shortage of funding, it is also getting a larger and larger hold in the UK Armed forces as well as other departments of government. We Must Stop It.
=====
Background reading:
This issue is well outlined in Private Eye 1383 page 10.
this issue is also very well explained in the Private Finance Initiative Special Report by Paul Foot in 2004.
