A group of 40 Labour MPs have written to Chancellor Rachel Reeves, urging her to scrap proposals to fund NHS infrastructure through private finance initiatives (PFIs).
PFIs are a type of public-private partnership where private companies fund, build, and maintain public infrastructure, such as hospitals or schools, while the government repays them over many years.
As an example, PFI enabled the Queen Elizabeth Hospital in Birmingham to be built quickly by leveraging private funding and transferring construction and maintenance risks to the private sector.
Originally intended to deliver projects without increasing national debt, PFIs have been criticised in the letter for higher long-term costs, inflexible contracts and burdening NHS trusts with decades of repayments.
The MPs, including Cat Eccles, Clive Lewis, and Rebecca Long-Bailey, have called for a commitment to fully publicly funded investment in hospitals and other NHS facilities.
“While PFI projects were presented as a way to avoid borrowing, they have proven far more expensive than publicly funded alternatives,” the MPs’ letter reads. “Returning to private financing would risk repeating the mistakes of the past and undermine confidence in the government’s commitment to the NHS.”
According to the MPs, 80 NHS trusts are still repaying a combined £44bn from previous PFI deals.
These repayments have constrained resources and contributed to ongoing service pressures across the health service.
Labour MPs argue that using private capital for NHS buildings would send a worrying signal about the government’s priorities at a time when waiting lists, workforce shortages and underfunding dominate headlines.
NHS trusts affected by historical PFI deals have cited years of reduced operational budgets, fewer resources for patient care and delayed upgrades to aging facilities.