£3m spent on doomed hospital plan

TAXPAYERS stumped up £3million for a major redevelopment of a North Essex hospital which was scrapped, it has been revealed. The doomed £167m private finance initiative project (PFI) at Colchester General Hospital would have modernised healthcare and centralised services and led to the closure of Essex County Hospital.

TAXPAYERS stumped up £3million for a major redevelopment of a North Essex hospital which was scrapped, it has been revealed.

The doomed £167m private finance initiative project (PFI) at Colchester General Hospital would have modernised healthcare and centralised services and led to the closure of Essex County Hospital.

But the scheme collapsed this week after more than five years of development with Essex Rivers Healthcare NHS Trust saying it needed to ensure its future plan was the “right one” for the long term.

However it emerged yesterday £3m had been spent during the past five years on staffing costs, including a dedicated team working on the PFI, professional advice and consultancy fees.


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A spokesman for the trust said £2.4m was provided by the Department of Health specifically for the project, with £600,000 spent by Essex Rivers.

Yesterday the PFI partner in the scheme, Senate Health, refused to rule out the possibility of seeking compensation from the trust, saying the late cancellation was “concerning”.

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But Richard Bourne, chairman of Essex Rivers, said he did not believe compensation would have to be paid.

“I can only comment from a trust point of view - we never got to the point in the procurement process where we signed off,” he said.

Mr Bourne said he hoped it would be only be a matter of weeks before new plans would be made public about an alternative proposal to centralise health services.

The new-look hospital would have included a £30m cancer centre, 170 more beds, 800 parking spaces and centralised all trust activities to one site at Turner Road, Colchester.

An Essex Rivers Healthcare NHS Trust spokesman said: “There is an agreement between the trust and Senate Health which covers a number of issues which, as you would expect, is subject to commercial confidentiality.”

He said there would be no further comment on the issue of compensation but explained the costs incurred with the PFI project.

“Trust expenditure last year was £168m, so the £600,000 is not a lot of money by comparison.

“Obviously it was hugely disappointing not going forward, but a lot of staff were involved in ideas about the PFI development which will be very useful as we pursue alternative, more affordable, strategies,” he said.

A spokesman for Senate Health said it was “extremely disappointed” that the trust decided not to proceed any further with the scheme.

He said: “Senate has worked very closely with the trust project team over the past two years in developing a first class clinical solution that would have benefited patients and staff alike.

“Senate understands the decision has been primarily driven by local capacity/demand issues.

“The fact that the project has been cancelled so far into the preferred bidder period is concerning and we will be discussing this matter with both the trust and NHS centrally in the coming days.”

Ray Coles, of the Essex Rivers Patient and Public Involvement Forum, claimed patient levels would suffer as a result of the setback.

He said: “Any debt reflects on to the trust which is already committed to paying back £14.5 million already. That can only mean that patient care will be compromised.

“When is centralisation going to take place now? It is really is a mess here, and until such times as somebody comes up with a new plan, we really are in limbo.”

Earlier this week the trust, which has a deficit of £15 million, said the reasons given for the policy change included a new emphasis on patients receiving more care at home or within their communities rather than in hospitals and new rules that mean hospitals will be paid by the number of patients treated.

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