Tue 17 Feb 2004

Failed PFI Firm asked to comment on new PFI schemes

Failed PFI company Ballast Wiltshier has been asked by the Scottish Executive to comment on new proposals to hand over primary health care centres, hospitals and joint facilities with local councils, to private companies.

Ballast collapsed in October last year leaving a trail of devastation in East Lothian schools. Falkirk Council's window replacement programme was halted and Renfrewshire was left with only one bidder for its controversial schools PFI scheme.

In East Lothian sub-contractors have gone bust with local workers thrown out of their jobs and other contractors have called for an investigation by the DTI.

Dave Watson (UNISON's Scottish Organiser - Policy) said: "It is astonishing that the Scottish Executive should be seeking the views of a company that has wreaked such chaos in Scotland's public services. They have clearly learnt nothing from the East Lothian experience. Instead our health centres, hospitals and social work provision are to be laid open to the very same risk".

The proposals are set out in Consultation on the use of Joint Ventures to deliver primary care/joint premises. Ballast are included in the list of consultees (P16). The plans involve establishing joint venture companies to run health centres and other joint care facilities with local councils. The legislation will give powers to extend the scheme to hospitals.

Apart from the involvement of Ballast, UNISON will be highlighting other flaws in the scheme including:

* It will be limited to large schemes (£20m minimum) because the private sector is not interested in small scale local facilities. This will drive the centralisation of health and social care or distort priorities by having to group disparate schemes.

* The paper claims that the partners (including NHS Boards and councils) will share profits. But, the public sector will hold only a small minority stake (typically 20%). Private contractors to the joint venture walk away with the real profits.

* This means the public will see very little return for the real risks as the Ballast experience has demonstrated. As with all PFI schemes far from providing a flexible solution, the public sector is tied into 30 year plus contracts at inflated prices. Instead of transferring risk to private companies the public sector always has to pick up the pieces.

Dave Watson said: "Instead of taking Scotland further down this failed route the Executive should follow the recommendations of their own auditors, Audit Scotland, and provide a genuine level playing field between public borrowing and PPP. No public authority willingly wastes taxpayers money on PPP when they can borrow more cheaply themselves".

ENDS

Notes for Editors: The Scottish Executive consultation paper can be accessed at: http://www.scotland.gov.uk/consultations/health/cjvpc-00.asp These plans are partly based on an English NHS scheme called Local Improvement Finance Trust (LIFT).

A UNISON guide to this scheme can be accessed from the UNISON UK website at: http://www.unison.org.uk/acrobat/13620.pdf The details re the collapse of Ballast Wiltshier can be found on the UNISONScotland PFI Illusion Briefing for January. On the website at http://www.unison-scotland.org.uk/briefings/pfijan04.html.

For Further Information Please Contact: Dave Watson (Scottish Org. - Policy and Info) 0845 355 0845 (w) 07787 558410(m) Chris Bartter (Communications Officer) 0845 355 0845(w) 0771 558 3729(m)

Index