1. Public Private Partnerships “The Third Way” (T. Blair)

2. How does PPP work?  Money from the council and from a private company is pooled to finance large scale spending projects.  The council then pays back the money to the private company (interest is added on).

3. What are the advantages of PPP? 1.Will produce many more hospitals much more quickly than NHS could (14 by 2004) 2.State of the art with rolling up-grades 3.Risk transfer – the PPP builder takes care of all repairs etc.

4. Advantages (continued) 5.Buildings revert to NHS ownership after terms of contract (e.g. 30 years) 6.Because the payments are spread over 30 years the cost of the new hospitals is not a huge drain on the budget – Government borrowing doesn’t look so bad!

5. What are the disadvantages of PPP? The total cost over the thirty years is much dearer than if the NHS built the hospitals Private contractors will ‘sweat the asset’ – make sure every room / bed is used to the maximum to keep profits up Public money is leaking out of the health system into the hands of private contractors

6. Disadvantages (continued) Private earnings –the contractors will want as many pay beds in the hospitals as possible as they will make money from the ‘catering and hotel’ services provided to private patients There have been reductions in workforces and dropping wages despite TUPE