• NHS Improvement to meet trusts with “early PFI deals”, to discuss plans for the remaining years of the contracts.
  • The regulator has established a working group to explore the possibility of buying out some PFI schemes.
  • Jim Mackey has previously described the profit margins within some contracts as “absolutely ridiculous”.

NHS regulators have set out next steps in their efforts to help trusts buy out private finance initiative contracts which have “absolutely ridiculous” profit margins.

In a letter sent to providers yesterday, NHS Improvement said it was planning an event for providers with “early PFI deals”, to discuss plans for the remaining years of the contracts.

In the NHSI letter, chief executive Jim Mackey said: “I am… grateful for the suggestion of Susan Acott, chief executive of Dartford and Gravesham NHS Trust, that we should bring together those trusts with early PFI deals, to discuss how best to plan for the final years of these contracts and to deal with the specific issues that may arise at this point.

“We will be arranging an event soon to discuss these issues, and will communicate further details in due course.”

The letter referenced comments he made at an HSJ event last November, when he said a working group had been established to explore the possibility of buying out some PFI schemes.

He said at the event that the profit margins within some PFI schemes are “absolutely ridiculous” and the NHS would be missing an opportunity not to take advantage of the “lowest borrowing levels since the Napoleonic war”.

Mr Mackey was involved in a major PFI buy out when he was chief executive of Northumbria Healthcare Foundation Trust.

The letter, published on the NHSI website, also echoes comments made at the same event around managing PFI contracts more robustly, in cases where they cannot be bought out.

It says: “The ongoing cost of PFI schemes is a significant part of the cost base for many of your organisations and for the provider sector as a whole.

“As many of you know, reducing this cost and ensuring that the NHS gets the best possible value from these deals is something which I personally feel very strongly about….

“Notwithstanding other available options, I believe that we can make significant in-roads though improving the way we manage PFI contracts and we are actively considering a number of ways we can support you in this area.

“As a key first step, later this week we will be issuing a survey asking all trusts to tell us more about how those contracts are managed currently and the issues you are discussing in this general domain and, in particular, with your PFI suppliers.”

This article has been amended. It previously stated that Northumbria Healthcare Foundation Trust has completed the only PFI buy out by an NHS trust. The Northumbria deal is the only time an NHS trust has bought out its contract with a local authority loan. There have been other PFI buy outs including at Tees, Esk and Wear Valleys Mental Health FT.