SHOCK COST OF HOSPITAL

CALDERDALE S new hospital has so far cost a staggering £103 million - three times the original estimate.

CALDERDALE S new hospital has so far cost a staggering 103 million - three times the original estimate.The shock figure comes from Mr Graham Johnson, manager of the Catalyst consortium which built and now services and maintains the hospital, leasing it back to Calderdale and Huddersfield NHS Trust.

An escalation in building costs plus extras such as debt servicing fees means the price of the Private Finance Initiative project has now soared beyond 100 million.

In another similarly funded project at the Cumberland Infirmary in Carlisle, which cost 67 million to build, an extra 17 million was added on top by the finance costs of PFI.

This was the cost of debt servicing during construction- 13.8 million - and of the 3 million paid to City financiers to underwrite the project and guarantee the bonds issued to pay for the project.

Like Carlisle, the bill for the Calderdale Royal Hospital has been greatly increased by the finance costs of PFI.

An Evening Courier investigation has revealed that the original 1994 estimate, by the previous hospital trust, was that a new, single site hospital with 614 beds would cost 34.85 million to build.

At that time Calderdale s three hospitals had a total of 929 beds plus 30 daycare beds. More than 300 beds, in acute, elderly and healthcare, would have to be lost in the move to a single site.

Over the next three years, as the trust tendered the project, costs climbed steadily from the original estimate. By 1997 trust managers were estimating total funding costs at 83.2 million.

The fees to be paid to Catalyst were also climbing. Originally the trust had said it could not afford to pay Catalyst more than 13.5 million a year. But this eventually grew to 14.45 million.

And in June 1998 health authority boss Tony Keighley issued a stern warning about the inflation of costs.

He said: Under no circumstances will the 14.45 million figure be reconsidered in the event of Catalyst failing to honour the commitments it previously entered into.

The trust board, he said, had expressed concerns as to the possibility of post-contract variations increasing the overall cost.

He warned the trust it would need to make even greater efficiency savings.

At the Cumberland Infirmary those savings - to meet the extra annual costs of PFI - meant cuts in clinical staffing budgets - a total of 2.6 million a year.

Dr Bob Heys, chairman of the Cash (Calderdale Against a Smaller Hospital) pressure group said: This seems to be typical of what is happening with PFI projects throughout the country.

The trust will have to pay these increased costs over the 30 years of its contract with Catalyst. It has already been agreed that the trust will ask the Government for extra funding.

The trust will need extra revenue. The chief executive has admitted serious financial problems and I have been told they are already overspent for the first year.

The Catalyst Healthcare consortium is jointly owned by Bovis Lend Lease, ISS Mediclean, Bank of Scotland and the French bank Societe Generale.