A total of £45.6 million has leaked out in profits from the NHS in Hampshire and the Isle of Wight to private companies over the past two years, enough to pay for an extra 260 doctors.
Out of the £362 million spent by the NHS on private companies in Hampshire and on the Isle of Wight over two years, £45.6 million has leaked out in profits – the seventh highest amount for all 42 Integrated Care Boards (ICBs).
Independent research raises concerns
These are the findings of the Centre for Health and the Public Interest (CHPI), an independent think tank which aims to ensure the founding principles of the NHS are at the heart of how health and social care services are delivered.
The Hampshire and Isle of Wight ICB responded that it works with a range of providers, including NHS organisations, voluntary sector partners and independent providers to increase capacity, reduce waiting times and improve access.
David Rowland, director of the CHPI, said,
“Given the massive pressures faced by the NHS in Hampshire and the Isle of Wight, the large amounts of profits which are leaking out of the NHS to private companies urgently needs to be looked at both by central government and local NHS leaders.”
Enough to fund 260 doctors
A sum of £45.6 million could go towards frontline patient care and would be enough to pay for an extra 260 doctors or 550 nurses over a two-year period, the CHPI said.
Its research finds large profits being generated despite the NHS in Hampshire and the Isle of Wight facing ‘huge financial pressures’ and recently reporting a £76 million deficit.
The figures come from a wider study published by the CHPI which finds £1.6 billion has leaked out in profits from NHS budgets across all 42 ICBs and NHS England over the last two years.
A profit cap of eight per cent on companies used by the NHS would have saved £656 million over the period, according to the think tank.
Tax havens and overseas ownership
The CHPI has also pointed to the NHS in Hampshire and the Isle of Wight being increasingly reliant on companies ultimately owned overseas – the fourth highest ICB in England for spending on companies registered in tax havens.
Out of the £362 million spent by the NHS in Hampshire and the Isle of Wight on the private sector over two years, £66.7 million was spent on companies whose ultimate owners are based outside the UK.
From this, £22.7 million went to companies whose owners are based in tax havens.
This makes it difficult to know who owns the companies on which there is increasing dependency and whether they are paying the correct amounts of tax, the CHPI said.
In addition, the think tank flagged millions of pounds of ‘scarce’ NHS resources in the region being used to pay interest on high-cost private sector debt.
Private equity debt adding to the burden
The NHS in Hampshire and the Isle of Wight is increasingly reliant on companies owned by private equity investors.
These types of companies tend to be saddled with very large amounts of high-cost debt, the CHPI said.
To pay interest on these loans they use the income they receive from the NHS.
The CHPI research shows that over the course of the past two years, £10.6 million of NHS spending in Hampshire and the Isle of Wight went towards paying interest on private sector debt.
What the think tank is calling for
Several recommendations for government are being put forward by the thinktank in light of its findings.
These include a cap on the profits of companies with an NHS contract, a limit on the amount of debt held by a private company with an NHS contract and full transparency about where money going to private companies ends up.
Finally, the CHPI is calling for a requirement for all companies providing NHS services to be tax registered in the UK.
NHS Hampshire and Isle of Wight responds
James Lowell, chief commissioning officer for NHS Hampshire and Isle of Wight, said in response,
“Our priority is to ensure patients in Hampshire and the Isle of Wight receive timely, high-quality care.
“Like NHS systems across England, we work with a range of providers, including NHS organisations, voluntary sector partners and independent providers, to increase capacity, reduce waiting times and improve access to services.
“The use of independent sector providers forms part of the national NHS approach to patient choice. Providers must meet strict accreditation requirements to be included, and patients can then choose where they receive their care.
“Where patients choose an independent provider, services are typically delivered at nationally set prices, ensuring consistency and value for money across the system.”
Mr Lowell added that all services the ICB commissions are subject to robust regulatory, financial and quality controls, and it remains focused on using resources as effectively as possible to deliver the best outcomes for patients.
This article is from the BBC’s LDRS (Local Democracy Reporter Service) scheme, which News OnTheWight is taking part in. Some alterations and additions may have been made by OnTheWight. Ed
