Once they begin a procurement process, trusts have a strong incentive to continue with a scheme, even when it has become, by any reasonable standard, unaffordable.
Costs increase during the procurement process, because the amount of money and managerial effort put into the scheme is very significant and, in the absence of a fundable public sector option, the temptation is to push on with schemes long after the financial case has deteriorated. The result, as we have seen all over the country, is that PFI projects are associated with major reductions in the number of beds and staff-ostensibly driven by clinical need, but actually driven by financial considerations that are not clearly linked to evidence of clinical need, and which frequently lead to occupancy rates that exceed NHS norms. PFI is nonetheless associated with financial problems during the operational stage of contracts-and this often leads to a further round of service cuts (Hellowell and Pollock 2006).