A report from the recent NHS Greater Glasgow and Clyde health board meeting confirms the Scottish Government footed the bill for the handover of the vital facility which treats older patients, as well as stroke victims.
The document confirms the health board will save £1.7 million a year in recurring costs now that operation of the facility has been taken in-house, with the opportunity to create skilled jobs locally.
The unit was built by LH Project Limited (Project Co) using a private finance initiative (PFI) contract which ran for 25 years, with monthly payments made for the length of the lease and a ‘buyback’ clause at the end to transfer it to the health board.
Larkfield Unit (Image: George Munro)
Following major concerns about the burdens of the potential costs for health boards, the Scottish Government agreed to cover the costs of putting the unit and others like it into the hands of health boards.
Greenock and Inverclyde MSP Stuart McMillan welcomed the decision by the government to safeguard the facility built under the ‘costly’ PFI agreement.
He said: “Thanks to investment from this SNP Scottish Government, NHS Greater Glasgow and Clyde has taken over ownership and maintenance of the Larkfield Unit.
“This concludes a costly 25-year private finance initiative (PFI) agreement which the then Labour/Lib Dem coalition introduced.
“There will be no impact on or change to service delivery in the hospital campus, but NHSGGC say the move brings a number of benefits to the health board, including creating a range of new highly skilled jobs in the area.
“This is a welcome development and once again shows the SNP Scottish Government’s commitment to Inverclyde’s health care services and facilities.”
In a report to health board members, officers stated that the Scottish Government Health and Social Care Directorates (SGHSCD) has provided the required capital to conclude the purchase.
Under the terms of the PFI contract first agreed in 1999 under the former NHS Argyll and Clyde, Project Co were responsible for the construction of the facility and the ongoing maintenance and operation of the site for the 25 year term.
There were three options open to the health board at the end of the contract including extending the period for ten years or vacating the unit and triggering an option to purchase the site.
In 2023 the health board agreed on the third option, which was to compensate Project Co and take over ownership.
As a result of the takeover one member of staff will be transferred over to the health board and a number of new maintenance positions will be created to keep the building up to standard.
According to its last annual report LH Project Limited (Project Co) is expected cease trading now that the contract has come to an end with Greater Glasgow and Clyde Health Board.