Question to the Department of Health and Social Care:

To ask His Majesty's Government how many NHS trusts have private finance initiative (PFI) debts; what is the scale of those debts; how many of the 25–30-year PFI contracts have been concluded; and how many PFI contracts are ending in legal dispute over the state of the annuity.

The Private Finance Initiative (PFI) programme was first established in 1992, with the final project signed in 2008. There were 126 projects signed by the National Health Service, including through NHS trusts, foundation trusts and primary care trusts, which are now held by NHS Property Services Limited (NHSPS). Some NHS organisations have multiple projects in their estates.

The private sector, through a Special Purpose Vehicle (SPV), entered into a contract with the NHS to design, build, finance and maintain the facilities. There is no debt between the NHS and those SPVs. The annual payment (unitary charge) for these projects includes the cost of facilities management, services such as catering and cleaning in some projects, and the cost of building maintenance and lifecycle replacement in all projects.

The following table shows information from the National Infrastructure and Service Transformation Authority (NISTA)’s 2024 published data on PFIs in the health portfolio and includes PFI projects where NHS trusts or NHSPS are the contracting authority:

Source: NISTA

Notes:

1. Some NHS trusts contract with NHSPS, not directly with SPVs
2. The number of NHS trusts in the table reflects how many NHS trusts have active PFI projects. Some NHS organisations have multiple projects in their estates.
3. The forecast value is updated annually based on inflation.

Projects end for a range of reasons, but there are no instances of legal dispute over the level of the unitary charge. The PFI Centre of Best Practice Team at the Department supports NHS trusts with operation projects where needed to ensuring value for money is maintained.

The Government announced in the 10 Year Infrastructure Strategy and in the 10 Year Health Plan that we will explore the feasibility of using new public-private partnership (PPP) models for taxpayer-funded projects in very limited circumstances where they could represent value for money. This includes exploring the potential to use PPPs to deliver certain types of primary and community health infrastructure.

A decision whether to use PPPs in these very limited circumstances will be taken by Autumn Budget 2025, based on co-development of a model and business case between NISTA and the Department. The business case will test value for money. Any new model will be subject to market-testing, will build on lessons learned from past government experience and models currently in use elsewhere in the United Kingdom, and the March 2025 National Audit Office report, ‘Lessons Learned: private finance for infrastructure’, a copy of which is attached.