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Audit on the performance of the PPP Contract of the Cascais Hospital

Audit Id 1445452818174
Title Audit on the performance of the PPP Contract of the Cascais Hospital
Title in original language

Auditoria à execução do Contrato de Gestão do Hospital de Cascais

Portuguese

Year 2014
Subject

Health and Social Care (incl. Welfare Benefits)

Private Finance (PFI and PPP)

Type

Performance

Type of performance

Performed by single SAI

Comments Following a competitive procurement process, the PPP Contract was celebrated between the Portuguese State and 2 private companies, one responsible for managing the infrastructure during a 30 year period, and the other responsible for operating the Hospital during a 10 year period (renewable up to 30 years). The audit: • compared the ex-ante and ex-post PPP Value for Money, considering the changes in value that resulted from the performance of the contract; • benchmarked the performance of the Cascais Hospital with comparable public units of the National Health Service; • evaluated the contribution of the management function to the value of the private partner responsible for the Hospital services and, thus to the sale value of its state-owned parent company (PPH – Portugal Private Hospitals, FIHC - Financial Investment Holding Company, Plc); • accessed the performance of the public partner in managing the PPP contract. Among other procedures, the financial model that supported the negotiation of the PPP and the 10/30 years economic and financial projections was audited. The report concluded that the profitability of the private partner responsible for the Hospital services was strongly negative and thus well below the estimates of the initial financial model. The value of the project to the partner responsible for the Hospital services was lowered by €27.5 million, a result of internal (controllable by management) factors, especially the increase in costs with staff, supplies and external services. The resulting accumulated debt on PPH Health – Cascais Partnerships, Plc, lowered the sale value of its state-owned parent company, PPH – Portugal Private Hospitals, FIHC, Plc.
Country

Portugal

Materials

Audit report

Portuguese

Download report
Contact
Tribunal de Contas of Portugal Audit Department VI
DAVI@tcontas.pt
http://www.tcontas.pt/
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