Schemes in Plymouth and at Hillingdon Hospital in Uxbridge, West London, are the latest to be halted as the Department of Health reviews the affordability of £12 billion of PFI building projects, Contract Journal reports today.

The department denies that there is a moratorium on such projects but admits it is worried. John Hall, head of health at the Treasury, says that the NHS will do very well to get an annual increase of 4 per cent, compared with the 7 per cent a year it has had since 1999.

His remarks, leaked to the Financial Times, suggest that NHS staff have been among the greatest beneficiaries of the fat years, becoming the highest-paid doctors and nurses anywhere outside America. What is needed now, Mr Hall suggests, is a dramatic improvement in NHS productivity so that it can continue to develop through efficiency savings rather than through large amounts of new money.

Patricia Hewitt, the Health Secretary, told the Today programme on BBC Radio 4 yesterday: “We have always known that after 2008, when we will effectively have eliminated waiting lists and got to the European average on healthcare funding, we won’t need the same level of unprecedented funding.

“That also means we have got to make sure that we continue to improve the NHS and get even better value for taxpayers from these unprecedented funds that are going in.”

GPs and hospital consultants have benefited from new contracts, and the Agenda for Change programme offers new pay scales to almost all other NHS employees. The Treasury figures suggest that GPs earn £80,000 a year, consultants about the same and nurses £25,000, on average.

The department has been trying to row back on the GP contract, embarrassed at its generosity. Yesterday the British Medical Association protested to the independent pay review body at what it called government interference and criticised the claims. It did acknowledge that many GPs and consultants earn more than their European counterparts.

But the implication that the NHS was not getting value for money from its staff was absurd, it said. Britain has far fewer doctors per head of population than most industrialised countries, and GPs have greater responsibility and a more diverse workload than those in other European countries.

Ms Hewitt has written to Michael Blair, QC, the chairman of the review body, urging a pay rise for doctors of no more than 1 per cent. James Johnson, the BMA chairman, said doctors were being blamed for the NHS deficits: “These recommendations are a kick in the teeth for doctors who have worked tirelessly to improve the quality of patient care.”

Economies are being sought everywhere in the NHS, and questions asked about the viability of PFI projects. The Plymouth Hospitals Vanguard PFI project, which was due to be relaunched this month in the form of two contracts worth a combined £600 million, is one victim of the new stringency.

At issue, Contract Journal says, are the trust’s plans to build a £200 million care centre as part of the package. Officials are said to be questioning whether the centre can cope with competition from enhanced GP surgeries and independent sector treatment centres.

At Hillingdon Hospital, the department is reviewing the £300 million scheme, checking assumptions about how many operations the hospital will do and whether that makes the PFI scheme affordable.

Yesterday Frank Dobson, the former Health Secretary, reiterated his support for the £1.15 billion Barts and the Royal London PFI scheme, whose hold-up triggered anger among doctors. He told The Times that there was “a sound intellectual case” for the scheme.

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