The trust that runs Huddersfield Royal Infirmary has admitted it pays £22m a year to investors who funded the building of Calderdale Royal Hospital , Halifax.
Hospitals finance chief Keith Griffiths made the admission before a Kirklees Council scrutiny panel which is discussing a plan which could close Huddersfield's A&E department.
Mr Griffiths added the trust had to save £17m to end this financial year £21m in the red.
Calderdale Royal Hospital was built for £64m as part of a PFI agreement signed in 1998.
But the deal is expected to cost the trust £774m in repayments by 2058.
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And trust chief executive Owen Williams said there was ‘virtually’ no escape from the deal which accounted for approximately 6% of the trust’s annual budget last year (£343m).
Mr Williams said the trust had enlisted three of the ‘big four’ City accountancy firms and NHS watchdog Monitor to help it wriggle out of the PFI – but it was without success.
He said: “That arrangement with Catalyst has been examined by Monitor to see if there is any flexibility.
“It was also reviewed by three external consultancies – KPMG, Deloitte and PWC – as well as our own legal team.
“They all came to a similar conclusion that as a contract it was virtually impenetrable.”
Through an exit clause the trust may break away from the PFI in 2028 – but it will cost them £200m.
Critics of the Right Care Right Time Right Place proposal say the PFI, rather than patient care, has been the primary stimulus behind the plan.
After the meeting at Huddersfield Town Hall, on Friday, Terry Hallworth of local campaign group, It’s Our NHS, said the PFI had been ‘the driving force’ behind the hospital shake-up plan.
Documents show the trust pays its PFI obligations to Calderdale Hospitals SPC Ltd, formerly Catalyst Healthcare Ltd.
At the time of the agreement Catalyst Healthcare was a consortium of construction company Bovis, RCO Holdings plc, British Linen Bank and the French bank Société Générale
Currently, its registered trading address on Companies House is given as the Manchester offices of Lend Lease.
Lend Lease is an international property and infrastructure group that runs buildings across the world, including Britain’s biggest shopping centre Bluewater.
It has also worked on the redevelopment of the World Trade Centre, destroyed on 9/11.