Susannah Cleary explores NHS estates and looks at the politics and policy implications of the NHS getting its house in order.
For too long, NHS estates has been neglected – both literally and figuratively – and scant attention has been given to how this huge resource can be used to support better services for patients and generate an income for the NHS.
The recent announcement that Sir Robert Naylor is to be appointed the national NHS property tsar might suggest that the penny has finally dropped. However, until the NHS gets its house in order, it stands little chance of delivering on its efficiency targets or ambitions to reform the way services are delivered.
The fact that Sir Robert (known in some quarters as ‘Bob the Builder’ – a moniker he garnered during his time at UCLH) has experience in negotiating big property deals using hospital estates bodes well. Indeed strong leadership is required if a theoretical opportunity is to be turned into practical benefits, improving efficiency, moving care out of hospitals and exploiting new technologies.
So why now? First there is the small matter of money; NHS estates are expensive to run and they’re worth a lot, making them the kind of asset NHS finance directors might turn their attention to in times of need. On the former, the direct costs of running and maintaining NHS hospitals is estimated at £7.3 billion, making it the third biggest cost to the NHS behind staff and drugs. On the latter, the NHS estate is also worth a lot, with Monitor putting its value (including land and buildings) at £31.2 billion.
By some estimates, the amount of land under NHS ownership is 6.4 million hectares (this figure doesn’t include primary care) and a significant proportion of the estate is either not in use or not being used to deliver clinical services. This has led the Carter Review to recommend that trusts should operate with a maximum of 2.5% of unoccupied or underused space.
While it’s true that buildings should not sit empty, and non-clinical staff could be located in alternative (cheaper) locations, neither should the government necessarily sell off the family silver. For one thing, you can only sell it once. More importantly, stripping the NHS estate back to the bare minimum (plus 2.5% wiggle room) runs the risk of creating a land base that is unable to meet future needs.
Ideally, underutilised stock should be used in a way that meets the needs of the community now and in the future, and generates revenue. One approach could be for the NHS to develop leaseback arrangements and work with housing associations to develop social housing. This option has the advantage of offering revenue generating alternatives and possible solution to the country's social housing woes.
However this approach, although potentially more electorally appealing, is unlikely to pack the same financial punch as a sell off to the highest bidder. Just as the Labour Party still faces criticisms of its PFI decisions, the current administration could be subject to adverse scrutiny if it sells off NHS estates to pay off NHS deficits, under the auspices of meeting its housing ambitions and achieves neither.
Policy makers need to be clear about why they are selling off estates – is it to deliver a social good, or as a way to make some quick and much-needed cash? Sir Robert would be well advised to resist pressure for quick wins as these are unlikely to serve anyone’s interests in the long-term.
Although the Carter Review focused on hospitals, NHS estates problems are just as endemic in primary care. While the vagaries of GP premises ownership, regulation, and a chronic lack of investment in primary care infrastructure are a source of considerable frustration for GPs, there is a bigger problem at hand: they also act as a significant barrier to delivering more care in the community since new models of care are difficult to deliver without suitable premises.
Many of the nearly 8,000 practices in England simply don’t have the space to provide additional services or bring on new staff. A 2014 survey from the BMA’s GP Committee showed that many practices are unable to offer more services to patients, because they simply lack the space and are unable to expand. Many GPs don’t believe their premises are fit to deliver care today, let alone in the future.
To kickstart the process of upgrading GP premises by bringing together GPs, nurses, specialists and other public services, the Chancellor announced a £1 billion fund for GP premises in late 2014. To date, this money has largely been invested in small scale projects and has failed to support the transformation it intended. Moreover, the implementation of the scheme has been mired by delays and administrative challenges with some practices having their funding revoked by NHS England.
With little incentive for professionals, who are increasingly gloomy about their long term career prospects, to invest in new facilities and better equipment, the NHS will need to think creatively about how to kick start renewal of the primary care estate. With little capital available to spend, this will require some tough decisions.
Capital budgets may have been raided, but the need for investment in infrastructure is arguably greater than ever. New models of care often need new premises, and this, coupled with a generation of expensive kit (including scanners and radiotherapy machines) that is reaching the end of its working life and advances in technology, demand investment to realise the benefits for patients. Land sales may be the only option, but that will make them no less difficult or controversial. Land in the NHS may be plentiful, but it is not all parceled up in easy to develop packages in desirable locations.
Land developers and lenders, manufacturers of health equipment, housing associations, health campaigners, GPs and hospitals themselves may all have an interest in either unlocking resources or exploiting the potential of the NHS estate, but they will need to tread carefully, creating a clear story about how they are not sacrificing tomorrow to paper over the cracks of today.