THE jury is still out on the Government's controversial idea to use private cash to build NHS hospitals, a new report claims.

Despite claims that the private finance initiative will boost the number of NHS beds, a Commons report has concluded that the scheme has yet to be proved.

The private finance initiative (PFI) has helped build two new hospitals in the North-East - in Durham city and Bishop Auckland. But both have been dogged by criticism and earlier this year officials announced they would be merged to help address a shortage of beds in Durham.

The report by the House of Common Health Committee said PFI was being blamed for "numerous ills" which might not be directly related to it, and there needs to be "more transparency, openness and accountability".

The report said: ''It remains to be demonstrated that greater use of the capacity of the independent sector poses no direct threat to resources in the public sector."

North Durham MP Kevan Jones said: ''I have always said PFI is too blunt an instrument. We shouldn't use it in every situation. We should look at where it is appropriate to use it and where it isn't.