Britain's first privately run NHS hospital is failing after it emerged today that the company responsible for managing its finances has generated a deficit twice as high than planned.
Circle had projected that Hinchingbrooke Health Care Trust in Huntingdon, Cambridgeshire, would be in a £1.9 million deficit after six months under its stewardship. But the private company, awarded a 10-year management franchise in February to help the struggling hospital, reported a deficit of £4.1m in September.
Health Emergency director John Lister told the Morning Star that the deficit revelations should scupper any potential for Circle's management of Hinchingbrooke being used as a model for other private companies to take over the running of hospitals across the country.
"Circle has been cutting staff and services in a desperate bid to make savings but the evidence shows that this approach simply does not work," he said.
The National Audit Office (NAO) said that before any more NHS hospitals are run by private providers the Department of Health must do a "lessons learned" exercise to make sure there are no weaknesses in the procurement process.
Public accounts committee chairwoman Margaret Hodge said she was "astonished" that Circle takes profit ahead of addressing the hospital's deficit.
She said: "Worse, Circle suffers no penalty if at the end of the 10 years the deficit is not paid off in full."
Circle said that despite the deficit it has improved Hinchingbrooke's A&E services.
But union Unison said that the NAO report showed that Circle's management of Hinchingbrooke is still a "dangerous experiment" and should act as a warning of the dangers of bringing the private sector into the NHS.