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Further thoughts and figures

Rounding things up:

The hospital reports that it makes £840k from parking, but has expenditure of £1.2m

Those costs include ‘capital charges’ of around £500k and a council lease which increased from £3k to £250k, plus rates of £120k.

The visitor car parking is operated by APCOA, staff parking by the hospital. I’m not sure if this is right, but if I add up all the expenditure that doesn’t go to the council or government, the hospital is essentially paying a maximum of £300k to APCOA to maintain its parking? (It is unlikely to be £300k as the hospital maintains staff parking – one question might be how that expenditure splits between staff and visitor parking) The remaining £900k goes to the council and government.

So do APCOA give the hospital £700k of their £840k revenue (£140k is staff parking revenue) and take something themselves?


Another FOI response – the mystery of capital charges and council leases

Previously on this blog the investigation into car parking charges at Good Hope Hospital went off on a tangent when I discovered the hospital was apparently spending £100,000 per month on car park maintenance.

I’ve now received a response to my Freedom of Information request asking what they spend that on, and it raises more questions.

Firstly, their spreadsheet of costs shows that the lease paid to the council jumps from £3,000 in 06/07 to £250,000 the next two years, which is almost entirely responsible for the big jump in costs I talked about earlier in this investigation.

There’s also a half a million chunk on ‘capital charges’. I didn’t know what that was, but managed to find this piece from the British Medical Journal in 1998 explaining that it is a form of tax on NHS hospitals, “requiring NHS trusts to pay interest and dividends on their assets, and to recoup those costs through the prices charged to purchasers”. However, the article mentions that “on average NHS trusts are paying out 9% of their annual revenue income on capital charges.” The particular charges on Good Hope’s car parking figures represent closer to 50%, but I’m not sure whether that is unusual, or merely one way of contributing to the overall hospital’s charges (or how much capital charges have increased since 1998).

Capital charges are clearly a contentious issue in the running of the NHS, however, as the author explains:

“Previously the capital charge “returns” the Treasury received from NHS trusts (around £2.5bn a year) were passed to the Department of Health, which included them in health authorities’ revenue allocations for hospital and community health services.8 They then entered into payments to NHS trusts, which made returns to the Treasury, thus closing the circle. When NHS services are provided by the private sector, which does not pay capital charges to the Treasury, the funding leaves the system, reducing the annual circulating fund out of which other trusts must make their returns. Unless there is a concomitant increase inNHS revenue to offset this leakage—and so far there has not been—this will lead to the bizarre phenomenon of privately financed hospitals being funded through what is in effect a tax on hospitals in public ownership.”

It turns out the author is now known as an expert on PFI and has written what looks like a hugely useful book for anyone interested in the workings of the modern NHS. I’ll be buying that in the hope of some illumination.

Meanwhile, I’ve approached her directly for any insight she can provide, and have also received an offer of help from someone via Twitter.

If you’ve any other ideas, or want to join the investigation, let me know.

Hospital parking charges at Good Hope Hospital – 2008/09 figures raise questions

I’ve had a response to my Freedom of Information request to Good Hope Hospital (PDF) for their income from parking charges – and their expenditure.

This is how they say it breaks down:

Year Income Expenditure
2006/07 762213 929989
2007/08 907976 1191302
2008/09 1064886 1206069

What makes me curious about these figures is that the hospital appears to be making a consistent loss on parking – of between £140,000 (08/09) and £280,000 (07/08). Often hospitals claim they outsource parking because it is supposed to be done more efficiently. I’m not sure how a car park which costs £1.2m per year to run can be seen to be efficient.

Meanwhile, while the Lib Dem figures showed parking charges rose by 20% from 06/07 to 07/08; these figures show that that rate has continued.

Curiously, the figures above differ from those obtained by the Liberal Democrats by around £60,000 – I’m not sure why.

But more importantly, I’m not clear how you can spend £1.2m on a car park – and that’s my next question to the Heart of England NHS Trust.

If you want to help me find out more, post a comment and I can invite you to the investigation.

Lib Dems dig up data on hospital parking charges

A few weeks ago the Liberal Democrats used Freedom of Information powers to find out figures for all hospitals. Our ongoing investigation managed to get hold of the raw data in spreadsheet format. According to that, Good Hope Hospital took £840,000 from parking charges in 07/08 – £700k from patients and £140k from staff. The previous year’s neat figure of £700,000 was made up of £576k from patients and £124k from staff.

The difference represents an increase of 20%. Looked at separately, a 13% rise in staff parking charges and 21.5% in patient parking charges.

If you want to help me find out more, post a comment and I can invite you to the investigation.

How much does Good Hope make from parking? The story so far

First a bit of background: I’ve been creating a new website that people can use to propose and pursue investigations – Help Me One of my own questions was ‘How much does Good Hope Hospital make from parking charges?’

That investigation now has 11 people working on it and has proceeded so quickly that I thought I should a) write a blog to record what’s going on and hopefully find others interested in the same issues; and b) take stock on what we’ve found out so far.

Here goes then:

Nick Booth found a Mirror article from 2008 based on Freedom of Information (FOI) requests which said Good Hope had made £700,000 from parking.

Question answered? Only half. Matt Buck suggested:

“Personal best guess is that it is the value of the existing contract to the Trust. The profit side of the operation in the car park would, or should, come out through [parking contractor] APCOA UKs accounts.”

Curiously, data for Good Hope was missing from the response to a Freedom of Information request submitted in March 2008. Paul Henderson, who found that, noted that

“Other hospitals in the Heart of England Trust [provided data], so it suggests it’s not a Trust-wide policy, but down to the individual hospitals”

Meanwhile, something else bothered me. Stacey Spencer had found a Birmingham Mail article which quoted Paul Quinsey, Facilities Manager at Good Hope Hospital, as saying:

“Income from car parking does not make a profit for the Trust. It contributes towards costs of staffing, lighting, barrier maintenance, pay-on-foot machines, grounds maintenance, energy and water charges, capital charges and VAT.”

A similar quote comes from the hospital which made the most money from parking in The Mirror story: 

An Addenbrooke’s spokesman said: “This isn’t £2m profit – it’s £2m income that funds a high-quality parking service on site for people who really need it. If we didn’t charge, that £2m would come out of our clinical care budget.”

But this raised the question: what does £2m buy you in parking – and why is it £700,000 for Good Hope and less for other hospitals? What costs does it go toward – just those incurred by parking, or other hospital services? How do they know how much to charge the contractors? When the annual report talks of “a commercial strategy based on maximising some of our current non NHS income” does that include parking?

And most importantly: how much are contractors making out of this? An article on parking contractors found by Paul Henderson pointed out how lucrative the field was: 

“Demand from institutions and private equity for alternatives to a rapidly weakening conventional property market is moving parking onto the same stage as infrastructure such as road tolls and airports.  Mission Capital, one of the brightest new stars in property, run by the equally bright Emma Sinclair, saw the opportunity a couple of years ago, by taking over KML.  Created in 1992 to advise on maximising income from parking sites, the small Kent-based group has regularly featured among the top 50 firms in the sector.  Sinclair has said she sees KML as a core part of Mission’s strategy, marrying expertise in maximising parking income flows with the capability to see property development opportunities.”

I’ve already learned a great deal through the experience, and become more passionate about the issue. The investigation continues. 

If you want to help investigate this, let me know in the comments below.