Trust decides £4bn price tag ‘too expensive’ for new hospital

Nottingham University Hospitals Trust said the ”building [of] a completely new, single site hospital… was ruled out as being too expensive”. Instead, its preferred plan would now involve a combination new build and refurbishment of its existing sites, which would cost around a quarter of the price — £1.2bn.

The provider was one of 21 acute trusts to receive a share of £100m seed funding from the Treasury in its second wave of the “40 new hospitals” building scheme in June.

The trusts were given up to £5m of the seed funding to progress their plans, which would be funded between 2025 and 2030.

NUH said it has worked up a preferred plan for the reconfiguration programme, called “Tomorrow’s NUH”, which will cost £1.2bn. It has yet to be approved by the Department of Health and Social Care.

A report for its board meeing in March said “considerations were being made as to how best to use this funding”.

The risks associated with NUH’s ageing estate are well reported. In 2019, it had the second largest estates backlog in the NHS.

The trust told HSJ in a statement this month: ”[The trust] now has a preferred plan for its Tomorrow’s NUH reconfiguration programme (part of the government’s HIP scheme). To reach this option, we went through an options appraisal process involving an assessment against a number of desirable criteria, both financial and non-financial, with initial financial modelling of each option. The preferred option is likely to cost c.£1.2bn.

“Our plan will deliver a new hospital configuration, with a combination of some new buildings and the refurbishment of parts of the existing hospital estate. The option of building a completely new, single site hospital to replace the current Queens Medical Centre and City Hospital sites was ruled out as being too expensive (estimates came to c.£4bn), as it would not provide value for money and we would not be able to deliver it within the programme’s timescale.

“Our preferred option will inform the Programme Business Case which will be submitted to the Department of Health and Social Care later in the year in line with due process. At this stage, no funding has been allocated to our programme aside from the £5m to pull together the business case.”

It is unclear how many of the trusts have published their predicted costs for the rebuilding projects. However, at the end of last year both University Hospitals of Leicester Trust and West Hertfordshire Hospitals Trust predicted costs of between £450 and £590, and £590m, respectively, for their rebuilds.

Another large teaching trust, Cambridge University Hospitals Foundation Trust, also predicted last year rebuilding its Addenbrooke’s site would cost in the region of £1bn.

HSJreported last month that two trusts originally in the second wave of the programme had been promoted to a group of trusts prioritised for investment.

The Hillingdon Hospitals FT, which is in Boris Johnson’s Uxbridge and South Ruislip constituency, and Manchester University Hospitals FT, were added to the first wave of six trusts that were set to receive capital funding by 2025.

The pair of providers were initially in a second group of 21 trusts to be given up to £5m in seed funding to progress their plans, and which would be funded between 2025 and 2030.