WILTSHIRE Health Authority is today set to approve the outline business case for a private finance initiative for the redevelopment of Marlborough's Savernake Hospital.

The proposal, the third of four options looked at and the one thought most economically viable, is to provide new buildings around the existing day hospital, outpatients' department and original hospital buildings, and to sell off the northern end of the site for housing development.

The estimated cost of the work is £8.9 million. After the sale of the land this would drop to £5.2 million.

Bill Spray, chairman of the hospital community group SHIFT, said: "In the circumstances this is the best deal we can manage and is a lot better than it could have been. The only question is whether enough money can be raised to minimise the amount of land that needs to be sold off."

Another activist, Bill Burroughs of Great Bedwyn, is holding a meeting in Marlborough Town Hall on December 11 to see if there is enough local support to raise the money by public subscription.

He said: "Some people are sceptical about the scheme but if enough people get on board it works out at not that much per person.

"I am very much opposed to a Private Finance Initiative. To sell off ownership of the land is a retrograde step. It means profit margins will rule and a monopoly service in operation."

He is particularly concerned the staff accommodation will be done away with.

He also points out that the Marquis of Ailesbury or his family might have something to say about the sale.

He said: "They gave the land to build a hospital. If it is being sold off, they might want it back. Has that been thought about? It strikes me they have a very strong claim."

If approved by the Health Authority today, the scheme will be submitted to the regional office of the NHS for approval, and could be put out to tender for a PFI early next year. Contract negotiations would follow with a submission of a full business case for final approval by early 2003.

Barbara Smith, chief officer of the Ridgeway Downs Primary Care Group, the author of the report said the development of new buildings attached to the listed buildings, designed by renowned Victorian architect Sir George Gilbert Scott, and the sale of part of the site for residential development is the most economically viable option and Kennet District Council, the local planning authority, has indicated its support for the approach.