Scandal-hit Consort firm wants Sick Kids contract

Construction firm Balfour Beatty is vying for the contract to build the new Sick Kids hospital, despite the fact that its Consort Healthcare spin-out has been blamed for a series of scandals at the Royal Infirmary

Balfour Beatty set up Consort with its partners to build and run the ERI under a private finance initiative (PFI) agreement, has submitted a joint bid alongside BAM Construction for the deal to finance the building of the hospital and manage it once it is completed in 2017.

The builders and their architects are to battle it out with Laing O’Rourke Construction and Brookfield Multiplex Construction Europe.

If the Balfour Beatty proposal is successful, it is understood that it would share construction responsibilities equally with BAM, but then take over three-quarters of
facilities management.

Conservative MSP and health spokesman Jackson Carlaw said the original PFI deal, which Balfour Beatty and its partners secured, had been “one of the most catastrophic NHS arrangements in the UK”.

He added: “The taxpayer, patients and NHS Lothian all suffer as a result, while the PFI partners benefit to the tune of hundreds of millions of pounds.

“There has been no end of maintenance problems at the ERI, despite it being relatively new.

“The public will be deeply concerned if those involved in the ERI, who have also been to blame for some of the delays with the new Sick Kids, are also the driving force behind making the project happen.”

The new Sick Kids, which will sit next to the ERI at Little France and incorporates Lothian’s clinical neurosciences department and child and adolescent mental health service, will be built with between £140 million and £165m of private sector cash. NHS
Lothian will then pay an
annual fee to the successful consortium.

However, the health board believes that as the new project uses a Scottish Government-backed non-profit distributing model, rather than a PFI, the contract will be fairer.

It will see the hospital automatically transfer to the health board once the 28-year contract expires and health bosses have more of a say in the running of the building. Profits that the successful bidders can make are capped.

Talks will now begin with the three consortia, before a winner is chosen in spring 2014.

A spokesman for the consortium including Balfour Beatty, which is known as B3, said: “We are looking forward to working with NHS Lothian to develop our designs and proposals during the next phase of the project.”


CONSORT, which is paid £60 million a year in NHS cash, has overseen a series of scandals at the decade-old ERI.

They include the company cutting power to a theatre while an operation was ongoing. The incident, a year ago, came months after a baby was born by torchlight as power failed in a birthing unit. More recently, theatres were shut down twice last year after flies coming from dead pigeons were able to access internal areas.

The firm allowed hundreds of its staff, employed at the ERI in non-medical areas, to work without background checks. Under the new Sick Kids deal, staff such as security workers and cleaners will be employed directly by NHS Lothian.