23 March 2022
Senator Lyndon Farnham delivered the following speech to Chamber of Commerce members:
Good afternoon and thank you to Chamber for inviting me to speak this lunchtime.
I am certain that most islanders will have a view on this topic. It has been discussed in homes, at dining tables, in pubs, in offices and in the States Assembly. It has led to many newspaper stories, letters, social media posts, petitions and reports.
So, I’m going to start by stating what I know. What we all know.
We have an urgent need for a new hospital.
We have a States decision on the agreed location.
We have a States decision on the access to that location.
We have a States decision on the budget and the funding.
And we have the absolute imperative and the moral obligation to fulfil our responsibility and build a new hospital.
We also have the most amazing, dedicated healthcare staff working in untenable conditions.
Our existing hospital has cramped wards. Corridors doubling up as bed and linen stores, buckets catching rainwater, creaking drainage and sewage systems, different departments bolted on to the ends of buildings and an overall confusing and, at times, undignified, patient experience.
We have a maternity unit described as having the level of facilities found in some developing countries, completely lacking peaceful and private surroundings for mothers and their new babies to bond.
There is also a distinct lack of any meaningful or useable outside space to help patients recover or visitors to reflect.
Despite the remarkable job our Health colleagues are undertaking 24 hours a day, 365 days a year, we can only continue to patch up and mend this hospital until 2026, before the costs of doing so accelerate at an exponential rate.
How did we get to such a position?
History
The General Hospital was built on the site stretching from the Parade to the sea and bounded by Gloucester Street in the mid-18th century. Even then, it took more than 20 years for work to start after the States Committee with responsibility was first formed in 1745, and then another 27 years before the first Islanders were admitted in 1772.
That was 250 years ago this year.
And of course, the hospital has evolved significantly since then. But so has our population, our demographics, and our response to contagious and terminal illnesses. Our primary healthcare facility is situated in buildings and geography bounded by the decisions made under George III.
250 years from its founding it is clear: we need a completely new, fit-for-purpose hospital.
We cannot let history continue repeating and ask Islanders to endure continued delays that impact their care and wellbeing.
New hospital
The current hospital journey started in 2012. And for more than eight years the States grappled with this challenging issue, expending considerable sums of taxpayers’ money but still failing at all attempts to deliver a comprehensive solution and a new hospital.
To get us back on track, the Our Hospital Political Oversight Group was established in 2019 with a brief to deliver and build a fully operational hospital by 2026. It is an ambitious but achievable target for success.
The timeline is vitally important because it is determined by our ageing and decaying health estate and the unsustainable cost of maintaining it. Work started, and has continued, at pace and with real determination.
Determination not only to deliver a new hospital, but also to ensure that Islanders would be involved at every stage and, from its outset, that the project would be clinically driven and designed unlike previous iterations.
Almost immediately, while we were still assembling the Project Team, we began what is arguably the most controversial aspect of the entire scheme – to select the location.
We know the controversy which surrounds this subject and that almost every Islander has a different opinion.
However, among the many unknowns, there were two certainties when it came to selecting the right site:
Hospital site
Firstly, a perfect site does not exist in Jersey, and secondly, the public must be involved in the site selection process.
To begin that search, we took all the previously suggested sites and invited Islanders to nominate any further locations they felt would be suitable for the new hospital.
That final sweep resulted in more than 300 site suggestions identifying 82 potential locations.
A representative panel of 17 public volunteers – from 154 applicants – were assembled as the Our Hospital Citizens’ Panel and worked to form their list of priorities.
These were merged with the criteria provided by senior clinicians and applied against each site to result in a final shortlist of two – People’s Park and Overdale.
A States debate followed at which the Assembly approved Overdale and instructed the Political Oversight Group to proceed. It was an extensive search and technical assessment like no other in our Island’s history, and endorsed by Scrutiny’s own appointed technical advisors, who agreed that Overdale is the best location for our new hospital.
Guided by clinical priorities, patient priorities, citizens’ priorities, the draft planning guidance and, of course, the overarching public interest, Overdale is both the more suitable and more achievable site.
Design
From a practical perspective, Overdale provides a better integrated hospital design and will deliver within the timescale of becoming fully operational by the end of 2026.
Unlike the UK and other larger countries, we cannot travel to different specialist hospitals in neighbouring towns and cities if we have acute or urgent needs. We have one hospital. And it must fulfil all of those needs in one place.
It will bring together a disparate health estate, and for the first time be a general hospital; an acute hospital; a day-patient hospital; a maternity, women and children’s hospital; a mental health facility; a knowledge and training centre; and a modern energy centre - providing power in the most environmentally sustainable way.
There will be more operating theatres, far greater patient capacity, more single ensuite rooms available to ALL patients, and 75% of inpatient beds located in single ensuite rooms.
There will be proper staff wellbeing areas and the training facilities to attract, and keep, the very best healthcare professionals well into the future.
And all of this will be set in carefully landscaped gardens and open spaces to provide an elevated, peaceful, and healing environment with far reaching views across the Island to aid recovery, work and reflection.
Road access to any hospital must provide safe and reliable 24/7 access for all users, including emergency vehicles, and where appropriate improve access by alternative modes of transportation, such as by bus, and for pedestrians and cyclists.
So, the site will also include new and dedicated access solutions with ample parking, convenient pedestrian and public transport connections, alongside the creation of new woodland walks, green landscaped spaces and parkland, and the planting of at least 860 new trees around the site and roads.
And yes, this will include the necessary enhancements to Westmount Road, to reduce risks of accidents and avoid blockages and delays to journey times.
Budget
But we have to be realistic – a health facility of this nature which not only meets today’s needs but remains flexible and future-proofed for decades to come requires significant investment.
The States has capped the budget at £804.5 million.
This figure includes the decommissioning, demolition, decant and migration of the current Overdale services to Les Quennevais and back to the new hospital at Overdale.
It includes all of the main work: the main hospital, the enhanced mental health facilities, the energy centre, the knowledge centre, and modern training facilities, car parking, and all external works.
It includes significant improvements to the public realm and the creation of new parklands, gardens, courtyards, additional green space and all landscaping.
It includes all access and road improvements with sustainable transport options and facilities.
It includes all of the equipment required and the technology for the entire health campus.
It includes all land and property acquisitions, and all professional fees, it includes all contingencies, optimism bias and provision for inflation.
The costs have been carefully scrutinised by the project team, the Political Oversight Group, Government officers and by independent advisers appointed to ensure Jersey is getting the right hospital and receiving the best value for money.
I would like to put the proposed hospital budget into some financial context.
The current cost of running the Health Service is approximately £230 million per annum.
That means that over the next 40 years we will spend somewhere between £15 to £20 billion in delivering our health services.
It is therefore essential that we make the right capital investment, informed by our financial experts and our clinicians, to create a purpose built facility that can safely deliver £20 billion worth of health services and the care for future generations of Islanders.
The Our Hospital project also consolidates huge swathes of our health estate into one location, freeing up a lot of land that can be used for other essential purposes. That land has significant value.
We cannot value that as part of our calculations and offset it against the cost of the new hospital at this stage because we simply are not sure what it is going to be used for.
But if, for example, we use the majority of that land for housing then that land is worth many tens of millions, or perhaps even more.
Funding solution
To pay for this investment the States Assembly have agreed what we believe to be the most optimum borrowing-funded solution, given our current strong financial position.
The amount borrowed will be paid back using interest from our reserves. Our modelling of our reserves clearly demonstrates that a debt-funded solution retains a far higher value than a reserve-funded solution.
This will enable the Strategic Reserve fund to receive the borrowing raised for the hospital and will not only provide the funding required to develop the project but also to ensure that the States are able to meet their obligations in relation to the issuance and the repayment of the bond.
There is a strong rationale behind this proposal.
Interest rates are at a historic low. Borrowing at a fixed rate provides certainty by inflation-proofing the bond repayments. If interest rates rise further – which is likely, the bond repayments will not rise.
Investment returns will cover annual financing costs and the growth in the reserves will repay the capital.
Standard and Poor’s cite Jersey’s liquid fiscal assets as a key credit rating strength. It is therefore far more prudent to keep our reserves intact, retaining full flexibility for future events. Depletion or delay now may require borrowing in the future when interest rates are likely to be significantly higher.
Put simply, the Jersey taxpayer will have substantially more reserves if we borrow at a low rate than if we use up the Strategic Reserve now.
You will all understand the financial and logistical benefits of running a single site operation over a multi-site operation. And then there is of course the value of this huge asset if future generations decide to relocate the hospital again at some stage.
I have every confidence that we have delivered a meticulously constructed and carefully-considered clinical, financial and logistical plan for a new hospital and health estate.
The final part of the planning process hands over to the Independent Planning Inspector in early April. He is due to deliver his report to the Planning & Environment Minister within 4 to 6 weeks. The Minister will then make the final decision which is likely to be in late May or early June.
I started this speech with what I know. I will finish with what I believe.
I believe our new hospital will be a shining example of good healthcare, providing the facilities and level of service that patients and their families both expect and deserve.
It will be a place that instils confidence and delivers excellence through all aspects of treatment and recuperation.
I believe it will attract and retain the very best medical professionals who, for the first time, can train and develop their skills without leaving the Island.
And it will mean those exceptional clinicians who come to teach the next generation of doctors and nurses can be on hand to provide healthcare to our Islanders at the same time.
I believe we are so close to delivering something exceptional for Jersey. The vast majority of islanders want us to get on with it. We have a responsibility, a duty and a moral obligation to build this hospital without costly further delay which, subject to planning permission, we will succeed in doing.
Planning
The planners' report also provided some positive views, to quote:
“There is no doubt that the proposed Our Hospital planning application performs well on a number of fronts. It is an undeniable and significant boost to the provision of clinical and mental health provision, providing fit for purpose health facilities for islanders, in concert with the Jersey Care Model.
"The enhancements to clinical care and treatments, and the removal of the risks which are inherent within existing facilities, cannot be overstated and weigh heavily in favour of the application."
The report adds: "In planning terms, the proposal is located in an area which complies with the island’s Spatial Strategy. It performs well on several technical measures. The transport and waste solutions and energy reduction targets are all agreed. Furthermore, the landscaping and ecological proposals are accepted and welcomed."
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