Comment: NHS estates cannot continue with the status quo

Jason Pereira, a surveyor at Essentia, reveals what Sir Robert Naylor's long-awaited independent review of NHS property and estates means for healthcare organisations

Jason Pereira

Blink and you may have missed it, but the much-awaited Naylor Review on Why the estate matters for patientswas published on 31 March.

Property, like technology, is an enabler of the NHS Five Year Forward View transformation of healthcare services

Sir Robert’s review is primarily focused on supporting Department of Health (DH) targets to release £2billion of assets for reinvestment and to deliver land for 26,000 new homes.

Many people have been pleasantly surprised by its far-reaching nature and the innovative, forward-thinking of some of the recommendations.

These combine to represent a step in the right direction for the future NHS estate.

The review outlines a total of 17 recommendations and spans three main areas:

  • Capability and capacity
  • Encouraging and incentivising local action
  • Funding and national planning

Given that an estimated capital investment of £10billion is required to fund estate transformation and enable STPs, it is important to get organisations on board early and gain traction with the disposal programme

Some of the headline-grabbing proposed measures include plans for a new NHS property body to provide ‘strategic estate planning’ for the service, an overhaul of the way data is collected and used across the NHS estate, and the recognition that housing frontline workers may be key to recruiting and retaining a strong workforce.

The opportunities and constraints of these key proposals, which have the potential to affect a major change for patients and staff, are examined below.

Recommendation 7 – Improved estates data

The review recommends that improvements should be made to the transparency and use of data.

Every property-owning organisation should have an accurate database of information about the assets it holds, to include size, tenure, age, costs, utilisations data etc. It appears a basic requirement, but it is nevertheless an important one.

Sir Robert is correct in flagging this issue and recommending greater accuracy and transparency of estates data. After all, property, like technology, is an enabler of the NHS Five Year Forward View transformation of healthcare services. Good data is essential to achieve these goals.

If the NHS is to have a modern, fit-for-purpose estate which is financially sustainable, there must be an appetite for significant reform

The key is not simply to gather it, but also to validate it through appropriate benchmarking and to keep it up to date.

This will be a challenge for an ever-moving organisation such as the NHS.

Without quality data, strategic management and investment decisions cannot be made, at least not correctly.

Therefore, from the standpoint of Sustainability Transformation Plans (STPs), it is crucial that the underlying information underpinning decision making is right from the outset.

Recommendation 11 - Assurance that receipts from land sales can be retained

Sir Robert recommends that HM Treasury and Department of Health provide assurances that disposal receipts from locally-held assets can be retained by the STP, if the disposal is in line with the STP goals.

This aims to incentivise STPs to identify surplus land more readily, removing fear of a central government money grab.

Given that an estimated capital investment of £10billion is required to fund estate transformation and enable STPs, most of which will be funded by land disposals, it is important to get organisations on board early and gain traction with the disposal programme.

Further recommendations are that HM Treasury approve a two-for-one offer, in which providers are given additional capital to match their disposal proceeds.

We may see this offer encouraging STPs outside London and the South East to expedite their surplus land disposals, to leverage the value of their combined estate.

Given that the offer is time sensitive, trusts now have an added incentive to explore disposal opportunities.

Recommendation 14 – Housing for NHS staff

One of the other interesting points in the document is the recommendation that surplus NHS land could be prioritised for the development of staff accommodation.

Some NHS trusts, particularly in London, are increasingly finding difficulties in recruitment and retention of key workers due to prohibitive living costs.

Housing associations who were previously a main provider of key worker housing appear to be providing alternatives to the traditional key worker housing model. This will require trusts to think about alternatives for housing frontline staff. This could be via JVs, leaseback arrangements, or Private Rented Sector (PRS) partnerships.

From a service perspective, the idea of increased staff accommodation appears inherently sound.

While there is no doubt there is a sense of ‘change and policy fatigue’ within the NHS at present, the status quo is no longer an option

How provision of staff accommodation on vacated land can marry with best value from a disposal, however, remains to be seen.

More investigation is required on this, particularly when assessed against the value of competing land uses, in particular private residential development.

If the NHS is to have a modern, fit-for-purpose estate which is financially sustainable, there must be an appetite for significant reform, such as that proposed by Sir Robert.

While there is no doubt there is a sense of ‘change and policy fatigue’ within the NHS at present, the status quo is no longer an option. If change is not actioned it may be imposed: the carrot and the stick.

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