Under a new financial deal, Bermuda Hospitals Board stands to save nearly $16 million over its 30-year payment for the new Acute Care Wing.

The savings achieved by the refinancing deal negotiated by Paget Health Services (PHS) was clarified yesterday by James Campbell, the director of hospital redevelopment for BHB.

Mr Campbell likened the PHS deal to the remortgaging of a house, although he stressed that the savings reflected only its nominal value.

“$15 million over a 30-year period is not the same as $15 million today,” he told The Royal Gazette.

With market conditions improved since PHS negotiated its financing for the project in 2010, Mr Campbell said the consortium had been able to go back to the banks for a better deal.

Thus, BHB’s annual service payments have dropped by $527,250 each year for the rest of the 29-year contract. The new hospital wing was financed under a public-private partnership, or PPP — an arrangement that has improved since years gone by.

In earlier years, such arrangements had been less favourable to the public entity, Mr Campbell said: in the mid-1990s in Britain, as interest rates dropped, the private partners had taken windfall gains that had not been passed on.

Under BHB’s deal with PHS, however, both sides are entitled to 50-50 shares on savings through refinancing — and savings will be split on any such deal going forward, he said.

The cost of the facility was set quoted as $247 million in 2011, with BHB paying $26.7 million to PHS in the first year.