3.3 Under this contract, Bywest will not receive any payment until April 2003 when the Trust is scheduled to begin to operate from the new hospital. Bywest is incentivised to ensure that construction and refurbishment are completed on time to provide the Trust's service requirements. No payment will be made until the assets are completed to the satisfaction of, and signed off by, an Independent Tester appointed by the Trust.
3.4 The payment mechanism is geared towards ensuring that the Trust receives the services agreed in the contract to meet its business needs. Bywest is incentivised to provide services as agreed in the contract. If the level of service falls below that required by the Trust, the Trust will make deductions from the unitary payment (Figure 10 overleaf). In early July 2002, the Department introduced a standard payment mechanism that has drawn upon innovative features of the mechanism used in the West Middlesex deal.
3.5 Maintenance at the West Middlesex Hospital site has been neglected in the past and the Trust estimates that this has led to a backlog of maintenance investment of some £28 million. Previously maintenance has been deferred as a result of funding constraints. One of the benefits of the PFI deal is that the contract ensures that the contractor is obliged to maintain the building to ensure there is no deterioration in building stock, which could impact upon service delivery.
10 |
| An example of deductions from the unitary payment | |
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| The Figure shows the impact on unitary payments of the closure of an operating theatre. | |
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| Impact on Bywest of causing an operating theatre to be unavailable for 24 hours (one weekday) | |
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| Financial impact on Bywest | Impact on the Trust and patients |
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| The payment deduction on the contractor is approximately £1,400. | More difficult to determine because of the variation in possible types of operation or theatre. A worst case scenario might result in as many as eight cancelled operations |
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| Source: The Trust | |