University Hospitals of North Midlands NHS Trust: Finance

(asked on 5th March 2020) - View Source

Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, what the PFI interest rate is that is charged to the University Hospitals of North Midlands Trust on the construction of the Royal Stoke University Hospital, what the comparable rate is for HM Treasury-funded projects; and what additional funding is provided to that NHS Trust for mitigating any difference.


Answered by
Edward Argar Portrait
Edward Argar
Minister of State (Ministry of Justice)
This question was answered on 11th March 2020

As each Private Finance Initiative (PFI) company raises its finance in different ways and from different sources, the most relevant and easily comparable way of describing the cost of PFI finance is the pre-tax nominal project internal rate of return. This rate for the Royal Stoke University Hospital PFI project was 5.70% in June 2007 based on the Government’s standard inflation rate assumption.

At the time the Royal Stoke University Hospital PFI was signed in June 2007, the interest rate for loans for capital investment, which was based on the relevant National Loan Fund rates, was 5.65%.

Where public dividend capital is made available for capital investment, under current rules Trusts are required to pay a 3.5% dividend on its net assets.

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