Great Western calls in lawyers over PFI contract concerns

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COMMERCIAL: The management of a South West hospital has ‘lost confidence’ in its private finance initiative service provider after it failed to maintain standards of quality and hygiene.

A paper presented to Great Western Hospitals Foundation Trust’s board last week revealed the trust had “significant concerns” about the facilities management services provided by Carillion, and was taking legal advice on its “options”.

In April, the hospital kitchens were given a one star rating for hygiene and issued with an improvement notice by Swindon Borough Council’s environmental health team. Last October the Care Quality Commission highlighted concerns about cleanliness on the wards.

The board report said these failings had posed a “potential risk to patients, visitors and staff” which was “completely unacceptable”.

Although standards of cleanliness had improved, “intensive nursing and management input” was required by the trust “to ensure standards do not slip”, the report added.

Great Western is also unhappy with the quality of Carillion’s management of the trust estate and a lack of “focus” from its management on addressing problems or anticipating new issues, it said.

“The trust has lost confidence in Carillion’s ability to resolve these issues, and the trust continues to pursue all means necessary to ensure they remain focused on addressing them,” the paper said.

The £300m turnover trust has to make a unitary payment of about £30m on the PFI contract this year, of which £11.6m relates to the facilities management contract.

Carillion built the £250m hospital, which opened in 2002, but sold the debt to investment company Semperian PPP Investment Partners which trades as The Hospital Company.

Semperian, which has 140 staff responsible for managing 92 assets worth £1.4bn, subcontracted with Carillion to provide facilities management.

Senior meetings have taken place between the trust, Carillion and Semperian, but have not resolved the trust’s concerns to its satisfaction.

Last week’s meeting heard the trust was taking legal advice on its “extremely complex” PFI contract and had set up a project group to “explore the potential for alternative service provisions”.

Under its contract, the trust can conduct a benchmarking exercise to ensure it is getting value for money in 2018. This could pave the way for the appointment of an alternative provider.

Trust director of strategy Kevin McNamara told HSJ the project group would be preparing for this benchmarking exercise and that the board was seeking legal advice to find a more immediate solution.

He said: “We have got to make sure we are using whatever levers or mechanisms are in the contract to improve the performance and that means making sure The Hospital Company are robustly managing Carillion to deliver improvements in service.”

A spokeswoman for Carillion said the company accepted that cleaning and catering standards “dropped below the quality that is accepted” earlier this year.

“In both cases immediate action was taken and improvements have been made,” she said.

“We are confident that there is not a risk to the safety of patients.

“We continue to work with the trust to make further improvements to services for patients, visitors to the hospital and the trust staff.”

Semperian declined to comment.