EmailNHS property is currently a hot topic. The government's white paper, Liberating the NHS, made no reference to the NHS estate, despite its strategic importance.
The dissolution of primary care trusts in 2013 means that the ownership of an estimated £6bn worth of property is undecided.
The results of a Hempsons survey seeking the views of NHS estates managers and other property professionals, healthcare developers and surveyors shows a high level of concern.
The survey reveals that 90% of respondents are very concerned about a lack of funding and investment in the NHS estate over the next five years, and significantly 70% fear that NHS property will deteriorate over that period.
The survey shows an appetite for new partnership to drive investment and strategy, with 80% of respondents favouring collaboration between the private and public sector, and a further 70% calling for greater flexibility to be creative with investment strategy.
Many are frustrated with cumbersome procurement rules which can create serious obstacles.
Big issues
There are big issues to address. Almost a quarter of the NHS estate, according to recent reports, is unfit for purpose and backlog maintenance has increased in the last decade to an estimated £3.5bn.
Significantly, the NHS pays to maintain an estimated 18% of the estate which is currently surplus or unused. The unoccupied or unused land is valued at £6.4bn. Further rationalisation and more effective utilisation of space is clearly required to release funds to re-invest in the estate and frontline services.
New and innovative solutions will be required of the new owners.
Theories abound as to who will own the NHS estate, but one possible contender is the new NHS Commissioning Board. Many view this as a temporary solution. The board may not be best placed to identify local needs and priorities.
To work as a long-term solution, local offices would need to be established with a strategic focus, but given budget constraints, many argue that this solution does not seem to provide any scope for investment in the estate in the short to medium term. Private or public/private assistance would almost certainly be needed.
Transfer to local authorities is another option. While this promotes integration with other local services, given budget cuts, this offers little scope for investment and better utilisation of NHS assets.
Another possibility is transfer to local foundation trusts. This has the benefit of keeping the estate in the NHS at a local level but will not help the market competition the government is keen to encourage.
Some doubt whether many foundations trusts would want to take the whole primary healthcare estate in any case and if they did, they would almost certainly have to look to new ways to make the most out of what they had inherited.
Hempsons' survey reveals that the most favoured long term ownership model to deliver improvements in the NHS estate is for new joint ventures between the NHS and developers to be established outside traditional Private Finance Initiative methods.
The industry would seem to be keen to see streamlined procurement which would give flexibility to create local "asset based" vehicles in which both public and private entities would have a stake to innovate and create their own local solutions.
One thing is clear - the government needs to address these concerns to secure an estate that is entirely fit for the 21st century.
Nathan East is a partner and Graham Lea is head of property at health and social care law firm Hempsons
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