The government’s flagship hospital building programme faces a 'capital desert' with new projects worth billions of pounds facing possible cancellation because of the credit crunch, it emerged last night.

A leaked minute of a Whitehall meeting involving Alan Johnson, the health secretary, and senior NHS managers reveals growing concern about the future of the private finance initiative, Labour’s preferred method of funding large capital programmes.

Johnson has asked David Nicholson, the NHS chief executive to 'go away and think very hard about what happens next', according to memo.

Sunday Times