Make the Bankers Pay – Claw Back the Profits From PFIs

Why is Reclaim the NHS launching a renewed campaign against PFIs – the Private Finance Initiative?

The NHS is entering a critical period and it is vital that we expose the profiteering allowed by PFIs.

First, there is intensified pressure on Trusts’ finances while PFI payments to the bankers and financiers are ‘ring-fenced’ and continue at very high levels of profit and interest.

Secondly, the round of PFIs mainly signed under the Blair/Brown governments are coming to an end and as the buildings are handed back there are many warning signs that they will be handed back in an unsatisfactory condition. The PFI for Queen Elizabeth Hospital, Woolwich expires in 2030. We need to  be vigilant that the costs of making good maintenance failure falls on the PFI companies and not on the public purse.

Thirdly, the government is planning a new round of PFIs in NHS England (NHSE). This is madness given the known problems and we will campaign against it.

The financial situation in the NHS

Last year collectively NHSE Trusts ran a total deficit of £780m. Wes Streeting’s 10 year plan intends that deficit support financing will be phased out in 2026-27 – that is, deficits run up by hospitals will not be covered by the government. Moreover, the Plan states that “By 2029 to 2030, most providers will be expected to generate a surplus, transforming the NHS into a driver of growth rather than a burden on public finances.”

The National Audit Office has shown that Trusts run up deficits because annual increases in government funding, which have been below the historical trend, has not kept pace with increases in NHS costs. These include rises in demand from a growing and ageing population, inflation, recovery from Covid, and a deteriorating NHS estate which raises day to day costs.

Hence the deficits are NOT due to inefficiencies but due to rising costs and demand which governments have consistently failed to fund. To then remove the buffer of deficit support financing means inevitable cuts to already stretched and struggling staff and services. Further outsourcing is also a likely response to constrained budgets, but such a course simply leeches still more profits out of the NHS while undermining and destabilising the ability of the NHS to provide a comprehensive and safe service.

In 2024-25 LGT recorded a surplus of £9m but this may only have been achieved by £40m of so-called “productivity improvement” (Annual report p.33) which can be a code word for working staff harder. The annual report for that year stated that in 2025-26 the Trusts needed to make “considerable financial adjustments by finding over £56m worth of savings”. (Annual report p.4) It is yet to be seen whether this was achieved in 2025-26, but that will not be the last we hear of “savings”.

PFI – how money is squeezed out

On this page we explain how the companies which hold the PFI contracts reap profits and interest from Trust. (hyperlink)

The company which holds the PFI contract for rebuilding QEH is Meridian Hospital Company PLC. Meridian is itself owned by two investment companies including Innisfree which is a major investor in UK hospital PFI. These two investment companies are the shareholders. They are entitled to receive dividends from any profit and they also receive interest payments on the loan they provide towards financing the initial building project.

The company which holds the PFI contract for the Riverside building at Lewisham is Ravensbourne Health Services Ltd. It has just one shareholder – HICL Infrastructure Company, another major investor in PFIs. As the shareholder it is also entitled to receive dividends and interest payments.

In 2024-25 the Trust paid these two PFI companies £42.1m to cover debt repayment, interest and maintenance and other services (Annual Report, p.92). From this process the two PFI companies extracted £12.3m. (Meridian and Ravensbourne accounts 2024-25)

This means that nearly one third (29%) of the money paid to the companies disappeared into profits.

Of those profits £2.6m went directly to the shareholders as dividends.

	Meridian Hospital Company PLC	Ravensbourne Health Services Ltd	Totals for two hospitals
Pre-tax profits since start of the contract	£111.2m (since 1999)	£62.7m (since 2005)	£173.9m
Pre-tax profits 2024-2025	£9.4m	£2.9m	£12.3m
Dividends shareholders have received since the start of the project	£51.5m	£5m	£56.5m
Dividends the shareholders received in 2024-25	£1.1m	£1.5m	£2.6m
Interest on loans that shareholders have received the start of the project	£29m (on a loan charged at 15% interest)	£16.3m (on a loan charged at 10% interest)	£45.3m
Interest received 2024-25	£591,000	£452,607	£1m

Reclaim the NHS aims to highlight this profiteering and to encourage the Trust to claw back at least some of the money that is lost in profits, and to use the situation to query the payment of exorbitant rates of interest to these investment companies. The amounts which could be clawed back may not cover all the current deficit, but neither is it insignificant. It is by raising public awareness of these abuses that we can strengthen the resolve of our hospital Trust to deal firmly with the profiteering.

PFI – Future dangers, repairs and a new round of PFIs?

Lewisham and Greenwich NHS Trust appears to be locked in disputes about the quality of maintenance and other services at both its hospitals – Queen Elizabeth Hospital, Woolwich (QEH) and the Riverside building at Lewisham Hospital.

If the PFI companies have had a penny-pinching approach to paying sub-contractors for maintenance work, there is the real danger that buildings will be handed back in such an unsatisfactory condition that the Trust will have still further expenses making good all the repairs and defects.

The NHS is being royally exploited by firms whose only interest is safe, guaranteed returns. The companies involved enter contracts intending to maximise their profits but when difficulties arise can simply fold up their tents and move on.