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Zohaib Hashim, Manchester-based private equity lawyer and chief executive of Blackmont Legal, argues that a rush to reverse privatisation could be costly.
Andy Burnham now has the top job in British politics. What he doesn’t have yet is a clear position on private equity in the NHS.
That ambiguity matters. Because whatever he decides next will land very differently from any decision he made in his first spell as health secretary back in 2009.
Burnham’s history on this issue is not straightforward. As health secretary in 2009, he floated a significant role for private providers in a future Labour government. After the 2010 defeat, as shadow health secretary, he shifted towards opposing further privatisation. In practice, his earlier vision won out anyway: independent providers delivered more than six million NHS appointments, tests and operations in 2025 alone.
The version of this problem Burnham now inherits is a different beast. Private equity has become the default financial model for large parts of the NHS supply chain – diagnostic centres, dentists, GP surgeries, all increasingly backed by big funds. His one-time leadership rival Wes Streeting was reported to be considering banning “private equity sharks” from healthcare outright. Whether that idea survives contact with a new health secretary remains to be seen.
But banning private equity from the NHS, while a great line on a podium, could be a flawed idea if executed without serious planning.
Why you can’t just switch it off
We aren’t talking about anonymous, shadowy shell companies. PE-backed providers operate under long-term NHS contracts, often with real capital sunk into facilities, staff and infrastructure. Push them out, and government isn’t simply cancelling a subscription – it’s buying them out at market rate, at least in most cases. That’s a major new spending commitment landing on public finances that are already stretched, and every pound of it comes at the direct expense of near-term care.
There’s a second, sharper problem: policy threats have a shelf life before they even become policy. The moment a clear-out looks credible, PE firms start protecting their position – tidying balance sheets, boosting operational efficiency, polishing the numbers for the highest possible exit valuation. A ban announced without teeth doesn’t clean up the house. It fires the starting gun on a fresh wave of consolidation, with taxpayers footing a higher bill than if nothing had been said at all.
Public sentiment against healthcare privatisation is real, but scratch the surface and the actual complaint isn’t usually about ownership structure. It’s simply about the quality of what’s delivered. Safety matters. Profit extraction at the expense of care matters. Most people couldn’t tell you what private equity actually does, but many see the downstream effects on the patient experience, and they don’t like it, particularly when the wider NHS is perceived as being under enormous strain.
That distinction matters enormously for policy design. If the target is patient protection rather than ownership ideology, tighter regulatory oversight of existing PE-backed providers could deliver most of the intended benefit, without government needing to buy out a single contract.
There’s also a definitional problem nobody in Westminster has solved yet. What actually counts as “private equity” here? Fund ownership specifically? Any group structure without clinical specialism? A GP practice owned by someone who isn’t a GP? Until that’s pinned down, it’s impossible to model what any ban would actually hit, or indeed miss.
What happens next, and what to do about it
In the meantime, expect uncertainty to do its own damage. Private care prices are likely to rise. Some of the flexibility currently built into outsourced NHS services may start to disappear as providers hedge against regulatory risk rather than compete for it.
For healthcare businesses already backed by private equity, or weighing it up, the advice is simple: get proper counsel before anything moves. Exit routes in this sector are far more complicated than the headlines suggest, and the gap between a good deal and a bad one almost never comes down to the top-line number. It comes down to structure.
Andy Burnham has built a career on defending public services. Whether he can now design a policy sophisticated enough to protect patients without triggering an expensive, self-defeating exodus of capital. That is the real test of his first months in the job.
