Companies making money out of National Health Services (NHS) hospitals are using tax havens to avoid paying tax, according to an article in The Sunday Times.

Quoting a report from the European Services Strategy Unit, a think tank, the newspaper reports that as many as 270 private finance initiative (PFI) projects are based in tax havens, and that these include more than 70 NHS projects.

Margaret Hodge, chairwoman of the Commons public accounts committee said: "It is shocking. Those who write PFI contracts should now insist the companies stay onshore. If they don't like it, they can walk away."

In the PFI model, hospitals are built by the private sector and leased back to trusts. During the last 20 years there have been about 700 PFI projects in the UK, and the estimate is that the taxpayers are committed to 200 billion pounds in contracts.

Last year the UK government identified 22 trusts struggling to pay crippling PFI charges. The UK government is now reviewing the PFI model, says The Sunday Times.