Large health projects ‘could be stalled for a year’

There are also fears over the future of frameworks, such as Procure 21 and LIFT, as well as concerns that new foundation health trusts could use their freedom to ditch PFI schemes.

The white paper proposes replacing primary care trusts (PCTs) with consortiums of GPs, who would be responsible for procuring services. This was described by one health director as “the biggest change in the NHS since the seventies”.

Many industry figures believe that reorganisation will disrupt capital expenditure.

Mike Magrath, a director for health at Gleeds, said: “The NHS is already challenged and if you add to that the restructuring over the next three years, it’s difficult to see how capital expenditure can happen at the same time. I certainly can’t see large capital projects moving for a year.”

The Procure 21 framework could be under threat as the paper outlined plans to “reduce NHS management costs by more than 45% over the next four years.”

A source at a contractor said: “They’ve stirred the pot and it’ll be two years before it settles down and they start with capital projects again. It’s got to cause some concern over Procure 21 too.”

The white paper also outlined plans for all hospital and mental health units to become foundation trusts within three years. Ian Greggor, a health project director at Cyril Sweett, said this could give trusts greater power to ignore the PFI route.

“Trusts will want to move away from the bureaucracy of PFI, and can streamline the process,” he said.

He also warned that LIFT schemes might not fare as well under GP consortiums. “The difficulty for LIFTs is that the new GP consortiums don’t fit with PCT boundaries,” he said.

The Department of Health said: “Procurement of health projects will be decided in due course. As far as we’re aware, Procure 21 is continuing.”