Pollock AM, Shaoul J, Vickers N.

Private finance and “value for money” in NHS hospitals: a policy in search of a rationale?

British Medical Journal, 2002; 324: 1205-1209

Summary points:

The private finance initiative (PFI) brings no new capital investment into public services and is a debt which has to be serviced by future generations.

The government’s case for using PFI rests on a value for money assessment skewed in favour of private finance

The higher costs of PFI are due to financing costs which would not be incurred under public financing

Many hospital PFI schemes show value for money only after risk transfer, but the large risks said to be transferred are not justified

PFI more than doubles the cost of capital as a percentage of trusts’ annual operating income