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P3 projects slow to a trickle

Six months after repeated disasters forced the British government to review its policy to develop infrastructure via public private partnerships (P3s), the number of new P3 projects has fallen dramatically.  The Financial Times reports that 85% fewer P3 projects were agreed to in the first four months of 2012 compared with one year earlier. The construction industry is not pleased: The  head of the UK Contractors Group (comprised of 30 big contracting firms) said the government needed to make “clear decisions soon... I don’t know if the government is going to tweak the model or do something more radical. But it would be good to have a clear signal from government as to where they are going with it.” The head of infrastructure at KPMG,  told the Financial Times “The industry is being crushed between the loss  of commercial activity and the government turning off the tap on its own spending. It needs projects now." P3 corporations made very big profits ...

Selling bonds -- a cheaper alternative to P3s

As noted earlier , the British government is reviewing its use of public private partnerships (P3s, or, as the British call them, PFIs) for the development of public infrastructure like new hospital buildings.  The government now says  it's the   ‘end of PFI as we know it’.      Unfortunately,  they seem to be more interested in simply pulling pension plans and foreign money into the PFI vortex. The PFI advisor to the British House of Commons Treasury Select Committee,  Mark Hellowell waded in to this mess earlier this week . Instead of wrapping pension plans into PFIs, he points to a cheaper way to involve pension plans in infrastructure. "The Treasury is currently pulling its hair out trying to find ways of bringing pension funds into infrastructure investment. But the cheapest way to do this is, of course, to sell bonds to them.  They will currently buy them at a real interest rate of something like minus 3% – not bad for projects t...

If 83% bed occupancy is too high what about 98%?

A leading Welsh doctor has warned of hospital bed cuts. Dr Richard Lewis, Welsh secretary of the British Medical Association, said the bed cuts could put patients at greater risk of catching a serious hospital infection. Dr Lewis told the Daily Post , “we know patients are still waiting on trolleys to find beds; elective surgery is being cancelled because of pressure on beds." Calling the cuts "unacceptable," Dr Lewis added, “There’s a clear link between hospital-acquired infections, the overcrowding of beds and high bed occupancy rates.” According to the most recent government figures , Welsh hospital bed occupancy is 82.5%. The government reports 13,116 hospital beds in Wales,  or one bed for every 229 people in the nation of just over 3 million. That however is far , FAR better than in Ontario, which is running at an astronomical 97.9% bed occupancy (after the elimination of about 18,500 beds, one-third of the total, since 1991). With 30,810 beds and 13,210,600 ...

Britain moves to privatize health care services

Public health care is under serious attack in Britain, with the Conservative-Liberal Democrat government's " The Health and Social Care Bill". Health unions vociferously oppose the Bill. UNISON, a major public sector union in Britain, says the Bill will: Lead to a far larger role for private (for-profit) providers, Allow 'private' patients to jump the queue Make the Health Secretary (like our Minister of Health) and the National Health Service (NHS) less accountable to the public Create significant threats to staff jobs (20,000 redundancies are expected) and staff wages, and Create a health care system based on wholesale competition (in contrast with the original NHS which was based much more on cooperation, collaboration, and integration). If implemented, such changes in Britain will create more pressure for more private, for-profit care in Canada. Already, British health care businesses are playing a leading role in privatizing Canadian health c...

Elders still don't know who will operate their (for-profit) nursing homes (if anyone)

The London Evening Standard reports that the 75,000 residents and staff of the for-profit nursing home chain Southern Cross still remain in the dark about their future, over a month after the business announced it was going kaput.  Britain's biggest nursing home business missed a deadline to announce the future operator of each home. The plan was to "sell" each home's operation back to the landlords by 1 August.   Now , Southern Cross claims it will make an announcement within two weeks, according to the Press Association . Nationwide the firm has 752 care homes and some 80 different landlords. The Standard reports that analysts expected that between 25 and 35 different operators would take over the homes. "The ongoing delay is highly frustrating for residents and staff," said Justin Bowden, national officer of the GMB union. "Southern Cross is at the mercy of its landlords." Public sector spending cuts, declining bed occupancy, and t...

Biggest nursing home operator closes - yet another P3 privatization disaster

Southern Cross, the giant British nursing home operator, is shutting down after months of financial troubles.  Until now, this giant for-profit corporation ran 752 nursing homes with 31,000 elderly and vulnerable residents.  A spokesman for British Prime Minister David Cameron said no one would be left homeless, adding that local authorities have a duty to make sure people received the appropriate care.  According to the Southern Cross  plan , 250 homes will be transferred to landlords. The landlords of the remaining 500 homes are still "finalising their plans" however. Southern Cross had profited by buying a  huge number of nursing homes and then realizing a cash bonanza by selling them to property companies and renting them back. But when government squeezed funding, Southern Cross continued to face steep rents and failed.    Southern Cross workers  interviewed   by the business newspaper the  Financial Times spoke of a deterio...

The plot thickens: British government opens negotiations with P3 corporations to cut costs

The British government, which claims to be clamping down on public spending, has opened negotiations with the corporations involved in government funded "public private partnerships" (P3s, or PFIs as the British call them).   The Independent reports :  ' One hospital was reported to have been charged £333 by a PFI firm to change a light bulb, while a school was charged £300 for an electricity socket.. . The industry could become the next target for public anger after the banks. Uncertainty around the future of the contracts could also impact on the companies' share price. Ministers think this is behind the willingness to do a deal…. (A) Treasury source said: "PFI is not immune from other savings in the public sector during the current economic downturn and we are looking to make savings.”' But it's hard to believe the British "Con-Dem" government will achieve anything much here (other than a media release announcing savings).  And indeed,...