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HOUSE SALES FUND HOSPITAL

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Wychavon scheme paves way for building revolution...
Wychavon scheme paves way for building revolution

By Nick Golding

A district council's plans to build a hospital to compensate for NHS cuts could soon be adopted across the country, LGC has learnt.

Wychavon DC in Worcestershire is using the proceeds from its sale of housing to construct a new 26-bed hospital. The building will be leased to the South Worcestershire Primary Care Trust in an arrangement that has already drawn interest from other authorities.

In what is believed to be the first instance of a modern-day council funding a new hospital, the£6m building is set to be opened in September to make up for the PCT's closure of a 110-year-old cottage hospital.

The council sees the project, which also includes a GP surgery, as a means of ensuring it gains rental income from the NHS, helping to restrict the district element of council tax increases to 2.5%.

Council leader Martin Jennings (Con) said: 'It should be a success for all sides - the PCT, the council and our residents and the GP practice.'

He said the council was also considering building a replacement community hospital in Evesham where a second community hospital is threatened.

Several other councils have visited Wychavon to see if they could set up a similar scheme.

Bob Austin, chief executive of Cotswold DC and an executive member of the Society of District Treasurers, said: 'There have been quite a few cases in the past where councils have been underwriting or in other ways supporting community or voluntary services - but this particular arrangement is not something we've seen an awful lot of.'

Many in the NHS are concerned the private finance initiative companies which fund most new hospitals are locking PCTs into inflexible 30-year contracts. Financial partnership with councils would focus on services rather than profits.

Dr David Janner-Klausner, the co-ordinator of the Democratic Health Network, said: 'This is a good example of local authorities taking the initiative. Many PCTs would prefer a partner that provides them with flexibility - this is very different to PFI.'

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