Oral Answers to Questions

Nick Smith Excerpts

Tuesday 21st February 2012 Commons Chamber

[Mr Lansley]

My hon. Friend will be aware of the difficulties involved in the contracts that we inherited; that is true for PFI, as well as for the NHS IT contracts and many others. We have to try to use PFI contracts more cost-effectively; on average, the Treasury exercise demonstrated a 5% saving on their costs. Beyond that, we have to ensure that from now on the NHS delivers a much more value-for-money approach to using private sector expertise, including proper transfer of risk.

[Nick Smith (Blaenau Gwent) (Lab)]

PFI enabled the building of many new hospitals and brought benefits to millions of patients. However, the Public Accounts Committee has found that lengthy procurement timetables led to increased costs. What will the Department do to sharpen its capital funding procurement model to get a good deal for the taxpayer?

[Mr Lansley]

That is a sensible question, and precisely why we are pursuing, as we said in November last year, a new approach to public-private partnership that does not entail the extreme costs, delays and burdens that past PFI projects have left. We are working with projects—for example, one at Alder Hey in Liverpool—to ensure that they demonstrate enhanced value for money compared with past PFI projects.