Northumberland hospital changes hands as PFI pay-out deal finalised
A hospital in Northumberland has been brought back into public ownership as part of a unique arrangement which will save millions of pounds of taxpayers’ money to be reinvested in frontline patient care.
Hexham General Hospital has transferred to Northumbria Healthcare NHS Foundation Trust after the organisation terminated the private finance initiative (PFI) contract which enabled it to be built more than a decade ago.
The trust announced in June that it had been given approval from the Government and Monitor – the independent regulator of NHS Foundation Trusts – to buy out the contract with the hospital having now changed hands.
The move, which will save around £3million a year, demonstrates the trust’s strong financial position and excellent track record for financial management over many years.
The trust is financially among the best-placed trusts in the country and has the lowest and best financial risk rating available from Monitor, meaning it foresees no financial issues for the organisation.
Northumbria Healthcare is the first NHS foundation trust in the country to have been given a rating by independent global ratings agency ‘FitchRatings’. It was assigned the best possible rating figure which is another endorsement for its stable financial position.
The deal is thanks to a loan from Northumberland County Council, which is believed to be the first of its kind in the country, and is as a result of the
strong partnership working which exists between the trust and the local authority.
Jim Mackey, chief executive of Northumbria Healthcare NHS Foundation Trust, said: “As we become the rightful owner of Hexham hospital, this is an important milestone for our trust and our patients. We are immensely proud that we are the first trust in the country to buy back a hospital in this way and deliver significant savings for taxpayers which will enable us to continue to invest in patient care.
“With ever increasing financial pressures on the NHS, we must continually look at innovative ways to deliver best value for money and bring down our borrowing costs. It is down to our stable financial position which we’ve built up due to prudent financial management over many years, coupled with our excellent working relationship with the council, which has enabled us to bring this deal to fruition.”
The arrangement with the council has been made possible thanks to the borrowing powers which are available to local authorities and will not impact on any other public council resource.
Guy Opperman, MP for Hexham, said: “This innovative deal is a positive step forward. The new agreement will benefit our local trust greatly and ensure a better deal for taxpayers across Northumberland.”