The Government should consider ‘abolishing’ NHS Property Services (NHSPS) and writing off GP debt, a report by an influential membership body has argued.
NHS Confederation’s new report declared that the current capital regime is ‘broken’, and made 16 recommendations to the Government ahead of the upcoming 10-year health plan.
It called for integrated care systems to have ‘greater control over the assets’ in their area by moving the ‘ownership and management functions’ of NHS Property Services buildings to ICBs.
The Government should also provide a ‘one-off national settlement on historical debt’ across all NHSPS sites, the report said, while noting that the removal of NHSPS would ‘detoxify the current premises challenge’ for GP practices.
In response to the report, NHSPS agreed changes are necessary to the current structure. Although it pushed back on suggestions for its total ‘abolition’, it suggested that its own experts should form a ‘new body’ which supports ICSs at a local level.
The body, which is owned entirely by the health secretary, also agreed that ‘GP debt and leases need to be addressed’, but called for any write-off to go hand in hand with a ‘change in funding’ to ensure future premises affordability for practices.
According to NHS Confederation, NHSPS together with Community Health Partnerships own 15% of the NHS estate in England, and their portfolios are mainly primary care premises.
Many GP practices have been in dispute with NHS Property Services over service charges in the last decade, supported by the BMA.
The disputes began from 2016 when NHSPS implemented its ‘consolidated charging policy’ with the aim of charging GP practices for rent, maintenance and service charges in order to recover costs.
But the BMA has said it received ‘hundreds of reports’ from partners who believed they were being charged ‘unjustly’, with some practices becoming ‘unviable’.
In 2023, legal action led by the BMA resulted in large reductions in service charges for five GP practices, ranging from £25,000 to more than £400,000.
NHS Confederation noted these issues, saying that NHSPS is ‘amid legal action to recover historical debt’.
The report recommended: ‘The legal process could be paused and the Department of Health and Social Care (DHSC) could provide a one-off national settlement on historical debt across all sites, in return for agreeing appropriate rents going forward with tenants who will pay the going rate to ICBs from day one.’
On GP practices specifically, it said: ‘Removing the NHS Property Services brand as landlord would allow GPs to re-enter NHS-owned buildings with confidence and de-toxify the current premises challenge.
‘Estate transferred to ICBs could move across with a transparent settlement regarding rent arrears, with new lease agreements signed between the ICB and providers.’
Responding to these recommendations, NHSPS highlighted that although it has taken legal action on behalf of DHSC in the past, there has been none since 2021.
As part of its recommendation to devolve more power to ICBs, the NHS Confederation said: ‘The Government should consider abolition of NHS Property Services and moving its assets to ICBs, splitting its functions and budgets between ICBs and NHS England.
‘This would enable use of existing assets, scrapping void space costs and enhancing local ICS asset-management capacity.’
The report also suggested that transferring ownership to ICBs may help to deliver care closer to home, which is one of the Government’s key strategic shifts, and also to ‘re-invest capital’ in order to form new neighbourhood health centres.
It pointed to the Darzi report which last year identified a £37bn capital shortfall across the NHS estate, and argued that the lack of capital investment in recent years has ‘left much of the NHS estate crumbling, notably in primary care’.
Other NHS Confederation recommendations included:
- Streamlining the capital approval process by reducing the number of steps
- Delivering longer-term (five-year) capital budgets for ICBs from the next Spring Review
- Enabling systems to raise private investment, which is not allowed at present.
NHS Property Services acknowledged the report and agreed that there is an ‘urgent need’ to make changes to ‘improve capital investment’, which the ‘current model cannot deliver’.
A spokesperson said: ‘We don’t believe that the report’s recommendation to “abolish” NHSPS will achieve the other 15 recommendations or make significant improvements to the capital regime.
‘If this expertise is diluted or fragmented it could lose the benefits to the NHS that has been building after 12 years of growing knowledge, capacity and capabilities.’
NHSPS did however suggest that a new organisation should be formed: ‘Looking forward, we believe the experts within NHSPS, alongside other NHS property organisations and teams, should form the nucleus of a new body that acts as an enabling organisation to support empowered Integrated Care Systems (ICSs) at a local level.’
On GP debt specifically, a spokesperson said: ‘We agree with the report that GP debt and leases need to be addressed. We have made similar recommendations to the report on how to tackle this problem, which stems from the removal of a subsidy in 2016 which was not instigated by NHSPS.
‘In our experience, if as recommended by NHS Confederation the Government should write off the debt, the key will be ensuring that sufficient revenue funding is available to meet current and future estate running costs.
‘The critical point not drawn out in NHS Confederation report is one of affordability at individual Practice level. Debt write-off without a change in funding will simply rebuild debt.’
They also noted that they were ‘not engaged’ by NHS Confederation on this report.
NHS Confederation chief executive Matthew Taylor said that NHS staff are having to treat patients ‘in crumbling buildings’ but that capital investment is ‘too often held back by red tape’.
He added: ‘Cutting the bureaucratic burden on NHS organisations getting approval to begin new projects is essential to avoid costly delays.
‘Part of this is simplifying the process, but it also requires more autonomy to let local leaders get on and make the decisions that are best for their populations.’
Last year, as part of the Autumn Budget, the chancellor announced a £3.1bn increase to capital investment in health over two years, including a £100m pot ‘earmarked’ for 200 GP estates upgrades.
A version of this article was first published by our sister title Pulse
