A new £521 million, 1,200-bed super hospital and mental health unit in Birmingham as part of the reconfiguration of hospital services and the improvement of clinical facilities in the city. Consort Healthcare were appointed preferred bidder for the project with a 35-year concession. Work on site is expected to start in the summer of 2005.
Consort Healthcare (Birmingham), is a joint venture between Balfour Beatty, the Royal Bank of Scotland, HSBC and AWG. The construction work will be carried out by a joint venture between Balfour Beatty Construction Ltd, Haden Young, the building services arm of the Balfour Beatty Group, and AWG Construction Services Ltd. Facilities management for the hard services will be provided by Haden Building Management Ltd, another Balfour Beatty subsidiary, under an arrangement that could yield over £300 million of long-term service revenue.
The trade unions had a strong relationship with the hospital board (trust) and were involved in the development of the PPP from the start. The trust decided to keep all the "soft" facilities management services in-house and is the first, large PFI hospital to do so. The trust and the unions visited other hospitals run by the preferred bidder and were not impressed. One hospital in particular, had serious problems of standards of service delivery.
There were also concerns about the complexity of having a multiplicity of providers, the loss of flexibility to meet future changes in requirements and the additional costs of paying for company profits and for risk transfer. The trust undertook detailed reviews of each service to ascertain whether an in-house service could meet the required standards and costs. They concluded that it would be better value for money to provide the services directly using the in-house teams.