A HOSPITAL trust in the North-East has become the first in the country to buy its way out of a controversial private finance deal.

Officials from the Tees, Esk and Wear Valleys NHS Foundation Trust, have revealed they now own West Park mental health hospital, in Darlington, after paying £18m to get out of a contract 23 years early.

The hospital, which cost £20m to build, was said to be one of the most modern mental health units in the country when it opened in December 2004.

The deal struck with the private developer – Aviva – means the mental health trust, which provides services for patients from the fringes of Tyneside down to Whitby, is expected to save about £14m.

It is understood the North-East trust is the first in the country to buy itself out of a long-term private finance agreement.

If the Tees, Esk and Wear Valleys trust had not bought itself out, it would have been committed to paying back £2m a year for another 23 years, at a cost of about £32m.

West Park Hospital was opened by the then MP for Darlington, Alan Milburn, who told The Northern Echo: “The standard of accommodation and the quality of services provided here is excellent.”

All of the 116 bedrooms are on the ground floor and each ward has its own therapy garden.

Built as part of the Labour government’s Private Finance Initiative (PFI), it replaced the outdated Pierremont Unit, in Darlington, the Beaumont Ward, in Darlington Memorial Hospital, and the Gables Unit, in Sedgefield.

PFI has been strongly criticised in some quarters for greatly increasing the long-term cost of new hospitals.

At the time, the Government argued that PFI was the best way to get badly needed modern hospitals built quickly.

The trust decided to take the buyout route late last year after a review of its finances. Under PFI, private contractors build the hospital and own it for up to 35 years while the local NHS pays an annual fee which includes an element of repayment, maintenance and interest.

It is not expected that this will trigger a stampede to pay off other PFI deals as the sums involved are often much larger than at West Park.