How a PFI legacy is costing a Sussex NHS Trust millions

The Howard Kidd Unit, Chichester.'''Picture by Louise Adams C131538-1 Chi Howard Kidd ENGSUS00120131127093335
The Howard Kidd Unit, Chichester.'''Picture by Louise Adams C131538-1 Chi Howard Kidd ENGSUS00120131127093335

A Sussex mental health unit that could be closed because it is too expensive to refurbish is set to cost taxpayers £8.5million – even if it remains empty.

The Harold Kidd unit in Chichester was one of six PFI projects set up in 2000-2001 to provide mental health care facilites in place of Chichester’s Graylingwell Hospital, in a 31-year contract.

Now the estimated cost of redeveloping the building to modern government standards has been put at more than £10million – and the NHS still has to pay off the remaining ten years of the PFI deal.

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The Sussex Partnership NHS Foundation Trust took over the PFI contracts from the former Sussex Weald and Downs NHS Trust in 2006.

In a public consultation that finished earlier this month, the Trust asked for feedback on options for meeting government standards that state mental health care should be in single sex wards.

Option 4, to refurbish the Harold Kidd Unit and move a different ward, was described as ‘prohibitively expensive’ at £13.1million, almost as costly as building a new Chichester site at an estimated £14.6million.

Instead, the Trust is proposing to close the Harold Kidd Unit and move patients to beds in Crawley or Worthing, with plans for a new dedicated and integrated care facility.

But it would still have to pay off the remaining costs of all PFI schemes, including the Harold Kidd building – a total of £8.5million over the next ten years. Those costs would apply even if the building remained empty.

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A spokesperson for the trust emphasised that the outcome of the consultation was still pending and the trust would explore other options for the site if it closed, including ending the PFI contract.

He said: “If the proposal to move inpatient services from Harold Kidd Unit is approved, following the consultation, we can then explore early termination of the agreement with the PFI owner.

“This will save us the cost of the yearly unitary payment and enable us to consider the possible sale of the site. Details of any discussions would be commercially sensitive at that stage and, therefore, confidential.

“If we are unable to terminate the PFI agreement early, we will look at re-using the building for non-inpatient purposes or investigate leasing the premises to other organisations for their own use.”

The six schemes originally agreed under the PFI in 2001 had a total capital value of £18million – plus running and maintenance costs.

Data from the Treasury and trust accounts shows that the majority of the £3-4million yearly PFI payments is an interest charge, with the whole life cost of all six schemes is currently estimated at £107million.