Since the announcement of proposals that could see Huddersfield lost it's A&E department, Calderdale Royal Hospital's PFI funding has come under scrutiny.

The PFI debt is part of the reason health chiefs have chosen Calderdale to keep emergency care, not Huddersfield — a factor unpopular with Huddersfield residents.

To help you understand PFI and its implications as the public consultation about Right Care, Right Time, Right Place begins, we've answered some frequently asked questions:

What is PFI?

PFI stands for Private Finance Initiative. PFI was invented as a means to generate private cash to build public buildings. Hundreds of schools, hospitals, prisons and other public buildings have been constructed using PFI since the late 1990s. It means the money does not show up on the Government’s books.

But what does it actually mean?

PFI arrangements are incredibly complicated and usually involve a multitude of investors providing money to a company that oversees the construction and ongoing management of the premises. The Examiner is yet to see the details of Calderdale and Huddersfield NHS Foundation Trust’s PFI arrangement with Calderdale Hospitals SPC Ltd, formerly Catalyst Healthcare Ltd.

Calderdale Royal Hospital, Halifax
Calderdale Royal Hospital, Halifax

How much is it costing the hospital trust?

Hospital bosses say they are paying £22m a year towards the PFI debt. It has been reported that overall debt incurred on building Calderdale Royal Hospital will cost £773m over the 60 year period. It would cost £200m to buy out the deal half way through the term. It is thought global property firm Lend Lease operates the services side of the PFI deal and retains the right to charge the hospital fees for a host of tasks such as changing lightbulbs and cleaning.

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Is the PFI expense the cause of the shake-up plan?

Health bosses have admitted the huge debt on the Halifax premises are a factor in their decision to focus their services there. But they have also claimed staff shortages and other efficiencies influenced the move to have just one major hospital. Government Health Minister Ben Gummer has admitted the PFI costs are about £90m to £100m higher than what it would have cost to build CRH using public money. The Examiner has learned that a hospital lawyers have tried to find ways to get the trust released from the deal but have been unable to do so. Following their failure, hospital chiefs’ did a u-turn on their original preference to focus emergency care at HRI.

MP Alan Milburn
MP Alan Milburn

Who signed us up to this crazy deal?

The deal itself was signed in 1998 by Labour Health Minister Alan Milburn on behalf of the Department of Health, who at the time boasted of the government’s programme to “modernise the National Health Service” by providing new facilities. A Freedom of Information request to provide the original papers is being considered by the Department of Health.

Is anyone still trying to get us out of the PFI deal?

Hospital bosses say they have tried everything and Mr Gummer admitted the Calderdale deal was one of the worst ever agreed but Huddersfield MPs Barry Sheerman and Jason McCartney have called on the Health Secretary to find a way. The Government has previously provided money to buy out hospital’s PFI deals.