Lewisham Hospital and the PFI parasites – Feb 2013

Lewisham Hospital is being sacrificed to parasites. The government’s plans to remove its Accident and Emergency service, maternity wards, paediatric and other services in order to provide private companies with extraordinary profits, which furnish the pleasures of multi-millionaires.

The South London Health Care Trust (SLHT) has run up a deficit of £15 million over the past 3 years. In 2012 the cost of servicing its debt is estimated to have been £61m – nearly 15% of its income. The SLHT total debt burden exceeds £2bn.

In 1995 a PFI (Private finance initiative) contract was put out to tender for the Princess Royal Hospital in Bromley and awarded to the consortium United Healthcare (Farnborough Hospital Ltd) by the Labour government in 1998. United Healthcare consists of Barclays Private Equity, Taylor Woodrow and a City fund management company called Innisfree. In return for their initial outlay of £118m for providing services ranging from power to medical supplies the consortium will receive £1.2bn over 5 years; an over 10-fold return. According to the National Audit Office the rate of return for the contractors is 70.6% - that is per year. If we put any savings we might have in a bank we would be lucky to get % interest, Tesco might make 6% on sales turnover. With the prospect of an over 10-fold return over 5 years capitalists turn into ravenous wolves (a 10-fold return is 1,000%) – and the NHS and schools etc are in grave danger.

To try and deal with the Princess Royal’s deficit it was merged with 2 other south-east London hospitals, including the PFI-funded Queen Elizabeth Hospital in Woolwich, in 2009. The Queen Elizabeth is also PFI-funded and is part of the Innisfree portfolio of investments. The companies – Barclays, Taylor Woodrow and Innisfree – have invested about £210m in the SLHT and anticipate getting £2.5bn back; another over 10-fold return on the initial outlay. The 3 companies operate multi-nationally – Taylor Woodrow in construction.

Last summer the government appointed Matthew Kershaw as NHS Special Administrator to deal with the bankrupt SLHT. He proposed the merger of Queen Elizabeth and Lewisham hospitals. Lewisham Hospital is a solvent independent trust, but its rundown and closure are intended to allow continuing payments on the Queen Elizabeth Hospital’s PFI contracts, and this is the government’s priority for the use of our taxes.

Innisfree (presumably named after a WB Yeats’ poem) was founded in 1995 – the same year as the Princess Royal contract was put out to tender. Its website states that it employs 26 people. Innisfree channels funds from pension funds, insurance companies, local authority pension funds, endowments and private individuals into projects in Britain, Europe, the USA and Canada, from which it derives its profits. Innisfree’s website states that the total worth of its projects is £16.4bn in capital value. These include at least 27 hospitals, 269 schools, the Whitehall HQ of the Ministry of Defence, a Scottish motorway and a Welsh jail. The website lists them. More than 700 hospitals, schools and other public sector schemes in Britain have been put under PFI schemes.

The head of Innisfree is David Metter, whose estimated wealth in 2011 was £60m and whose income in 2010 was £8.6m. David Metter is chair of the Public Private Partnership Forum, which lobbies for the PFI business; the personification of parasitism. Asked whether he pays taxes in the UK, Mr Metter did not reply. He owns a £5m villa in Little Venice in London. Innisfree owns a school in Birmingham where parents tried to start an after-hours club to keep their children off the street but could not because Innisfree charges £70 an hour for a caretaker! At this time of year David Metter and his PFI associates like to go skiing in Chamonix in the French Alps, below Mont Blanc. Cost of a hotel room? About £420 a night! Along with his Little Venice villa, Mr Metter also owns a family home in France. These are the rewards for being a parasite in Britain today.

Trevor Rayne

Sources: The Daily Telegraph, The Independent, The Guardian and the Innisfree web site.