The Assembly Health Secretary Jane Hutt has given the go-ahead for a new general hospital for Neath and Port Talbot to be funded under the private finance initiative.

Plans for the 270-bed hospital at Baglan were unveiled almost a year ago and the business case has now been approved after discussions with the Assembly.

The new hospital, which will replace Neath General, will include an accident centre and day unit.

The Assembly will provide almost £3m a year plus inflation from 2002 towards running costs.

The private sector company Baglan Moor Healthcare will build the £54m hospital and lease the building back over more than 27 years.

Questions

It is the largest health project so far under PFI in Wales and is being seen as a pilot scheme by the Treasury for the future.

However the public sector union Unison say many questions remained unanswered, particularly over the financing of the project.

The union's health officer in Wales, Dave Galligan, said the full figures were being hidden behind cloak of commercial confidentiality.

He added that half the staff, the non-clinical workforce, would be moving to the private sector, where different ethics would apply.