Tax break for private clinics

Major tax breaks for private hospitals offered yesterday will not spur developers, the Voluntary Health Insurance and hospital consultants indicated last night.

Developers currently can write off 100 per cent of the costs of building or refurbishing private hospitals and equipment costs over seven years, but demand has been poor.

The Minister for Finance, Mr McCreevy, yesterday got rid of a major hurdle by dropping one of the original conditions that such hospitals had to be run by a body with charitable tax status.

Hospitals will have to have just 70 in-patient beds, and not 100, to qualify for the tax breaks, which were granted at the last minute in the Finance Act this year.

Besides 70 beds, the hospitals will also have to have all-year surgical and medical services, an accident and emergency unit, and "at least" five specialist services.

So far, the scheme has done little to encourage new building because the VHI refuses to grant recognition: "We have not approved any new facilities," said a VHI spokesperson.

Ireland has enough private beds, she said: "The reality is that we don't have a waiting list in the private sector. Our job is to balance supply and demand."

The Irish Hospital Consultants' Association's general secretary, Mr Finbarr Fitzpatrick, said: "The VHI has the same control over private hospitals as the Department of Health has over public hospitals."