Private finance initiative for elderly care in Northamtonshire: A good example of a bad PFI contract.

A recent BBC article has shed light on yet another failed PFI contract – this time, involving elderly care in Northamtonshire.

Looking at the results of Northamptonshire’s Stabilisation Plan, the BBC report discussed how the 25-year contract has yielded poor, costly results.  At the outset, the private contract was set to deliver over 200 beds for qualifying elderly patients who were transitioning from hospital care or who were experiencing a crisis at home.  Unfortunately, this plan has failed to deliver, with staggeringly low occupancy rates of 30-50%.  Despite the availability beds indicative of this low occupancy rate, demand for the service remains high, resulting in the council spending £1-1.6million annually on alternative caring arrangements.  What’s more, the council is also paying for the services of the empty beds to the cost of £1.5-2million per year.

As reported by the BBC, the contract has been labeled as failure, quoting Northamtonshire councillor Matt Golby as calling it “one of the worst PFI contracts in the country” and prominent PFI researcher and campaigner Dexter Whitfield as saying that while he has seen many bad PFI contracts, “this one is a particularly extreme example”. 

Despite attempts to change the contract to ease qualifying requirements in order to make better use of the vacant bed spaces for vulnerable elderly persons in need, the contract remains intact.  Meanwhile, the council continues to pay a high cost for empty beds and the redirection of care.