New ERI deal will inject £32m into patient care

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A DEAL has been struck to save the NHS nearly £32 million as part of the controversial agreement with the private operators of Edinburgh's flagship hospital.

Health chiefs have persuaded private firm Consort to renegotiate the PFI contract for the Royal Infirmary - effectively a "re-mortgage", which slashes the cost of the company's original bank loan by reducing the amount of interest.

Annual NHS payments to Consort, thought to be around 45m, will fall by 1.1m a year as a result, and will drop further in line with inflation. NHS Lothian, which has been locked in months of talks with the firm's bosses, today vowed to plough the cash into patient care.

Additionally, Consort has largely backed down from its demands for more cash from NHS Lothian for its services - which the health board had threatened to fight in court - and will now hand back a lump sum of 5.2m.

Unions said the extra cash for patient care was welcome, but pointed out that under the PFI system, the NHS only receives 30 per cent of the "benefit" from refinancing.

That means the private consortium is also better off, to the tune of around 42m over the life of the contract.

NHS Lothian pays Consort for services such as catering, cleaning, maintenance and security at the ERI. The PFI deal, drawn up in 1998 to build the new hospital at Little France, was a "first generation" arrangement, and is now regarded as being unfairly tipped in favour of the private sector.

NHS Lothian today admitted the contract "did not offer the best deal", and efforts to force a fresh negotiation were first started three-and-a-half years ago.

Chief executive James Barbour said: "Refinancing of the PFI will deliver multi-million pound gains for NHS Lothian in the years to come. Following detailed negotiations, and within the confines of a nine-year-old PFI contract, we have now secured a better deal for our patients."

Stephen Gordon, Consort general manager, added: "We are delighted the negotiations have been concluded and that the refinancing of the PFI contract has delivered significant financial benefit to NHS Lothian."

The original make-up of Consort mainly included contractors Balfour Beatty and the Royal Bank of Scotland, but the latter sold its share to the construction giant in December 2005.

Today's announcement means the threat of court action by NHS Lothian against the group has been lifted.

Also under the new deal, 18 jobs in the materials management department, which handles stores and distribution, will transfer back from Consort to NHS Lothian.

Tom Waterson, chairman of Unison's Scottish health group, said: "While it is always better to have money channelled into patient care rather than into shareholders' pockets, any boost would look paltry beside the bonus likely to be going to Consort.

"If they are abiding by the Government's voluntary code on refinancing deals, the split will be 70 per cent to Consort and 30 per cent to the public sector.

"It is likely that they are getting over twice what the health board - ie the public - are receiving from this deal.

"The reduction of just over 1m per year in payments still leaves the public paying around 45m per year - when the original contract was for 30m. This type of financial sleight of hand confirms that PFI is still poor value for money for the public purse."

A Scottish Executive spokeswoman said: "We note the conclusion of the refinancing and that it has been undertaken in accordance with the voluntary code of conduct.

"It is important that NHS Lothian and Consort work together to ensure the provision of high quality services to patients."

NHS pledges help for depressed new mothers

HEALTH chiefs from the Lothians today vowed to promote wider awareness of postnatal depression.

NHS Lothian is set to support the UK awareness campaign Bluebell Day by jointly hosting a mental health conference in the Capital today. The conference will provide a platform for health specialists to work with the postnatal depression project, Crossreach, and explore the current provision of services.

Linda Irvine, programme manager for mental health and wellbeing, said: "NHS Lothian is committed to seeing wider awareness for postnatal depression (PND) in Scotland.

"This conference is a great opportunity for those attending to learn more about the services on offer."

Viv Dickinson, Crossreach manager, said: "It is so important that the stigma of PND is reduced and that those affected know where and how to seek the support available."