Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Government plan for hospitals - a tall order


Two weeks ago, health secretary Alan Milburn unveiled plans to build 42 new hospitals for the NHS between now and 2008, as part of a plan to inject increases in spending on the health service by 7.4% a year over the next five years. By 2008, he also expects to have 13 more hospitals under construction.

The plans are ambitious and, as with most major government spending commitments, will be a challenge to deliver within the timescale. Much of the new investment is likely to come in the form of public private partnerships (PPPs). Private finance will fund the upfront capital costs so the hospitals are built within the government's timetable, and the NHS Trusts - backed by taxpayers' money - will spread payment over 25 to 30 year concessions.

The theory has been attractive since the days of Tory chancellor Norman Lamont. Private contractors are financially locked into delivering on time and to budget by a compulsion from their bankers, plus the threat of punitive liquidated damages for lateness.

But right now, delivering these new hospitals by this means is looking to be a tall order given the skills shortage currently faced by the construction industry. Large numbers of professional engineers, especially from construction, are needed to put PPP projects together.

Teams putting together bids for PPP hospitals all use engineers to develop designs and advise on technical issues.

Other engineers advise the NHS trusts which commission new hospitals and still more advise the armies of bankers and lawyers who need technical input into the financing deals and contracts.

Of necessity, projects of this scale have to go out to tender, so the number of professionals required for each project multiplies still further. Even before the Budget, the NHS was involved in the biggest hospital building programmes undertaken for decades - most funded by private finance under PPPs.

Construction professionals working in the health sector will also tell you that engineering resources are already at full stretch, tackling the flow of existing PPP deals. An expanded hospitals programme could create an embarrassing logjam for the government, making Milburn's promise of so many new hospitals by 2008 look undeliverable.

With engineers an increasingly scarce resource, and delivery likely to be an election issue, perhaps it is time for the government to be more flexible about which projects need private finance and which need public money.

Over recent years, the government has invested huge amounts of effort into making public procurement more efficient, notably through the establishment of the Office of Government Commerce. Partnering and formalised supply chain management is being introduced across the public sector.

Bringing this into the NHS could ensure projects are built on time and to budget using procurement techniques based on traditional construction and which do not need the armies of professionals demanded by PPPs.

Perhaps then we can genuinely aspire to the quality of healthcare we are all led to expect.

Andrew Bolton is NCE's news editor.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Please note comments made online may also be published in the print edition of New Civil Engineer. Links may be included in your comments but HTML is not permitted.