Privately funded Scots hospital to cost taxpayers tens of millions of pounds as it transfers to NHS next year

The Royal Infirmary of Edinburgh, built and maintained under a controversial 25-year Private Finance Initiative (PFI) deal, is due to transfer from private operator Consort Healthcare to NHS Lothian next year, but taxpayers will have to cover tens of millions of pounds in outstanding maintenance costs. Consort has received around £1 billion over the life of the contract, yet the hospital has suffered persistent maintenance problems, including fire safety shortfalls identified by NHS Lothian in 2022. The case highlights long-standing criticism of PFI schemes, under which private firms fund and maintain public buildings in exchange for decades of payments, often leaving costly liabilities for the public sector once contracts expire.

Under a Handback Supplemental Agreement, Consort will set aside up to £86.36 million for upgrades—covering issues such as security cameras, fire safety and ventilation canopies in six operating theatres—while continuing to receive monthly PFI payments until the contract's expiry in December 2027, though it can no longer pay shareholder dividends or take on further debt. A report to NHS Lothian's finance committee, obtained under Freedom of Information laws, warned this sum would fall "well short" of what is needed, predicting a £9.7 million deficit even before accounting for further fire prevention works. NHS Lothian's finance director, Craig Marriott, said the agreement followed detailed investigations and expert advice and was judged the best-value option to avoid disruption to patient care, while academic Anne Stafford said the documents suggest a substantial share of restoration costs will ultimately fall on the public purse.