Health Service Focus

The crown estate of health and care

Along with optimising land usage and promoting co-location, a radical new report makes the case for rationalising all local NHS estate into one body. NHE’s Luana Salles reports.

As with the rest of the public sector, estate management has been a key focus across the NHS in recent months. Whether that’s in the form of NHS England CEO Simon Stevens developing a plan to build affordable housing for staff on NHS land, or the Department of Health considering accepting land disposal receipts in exchange for lowering trust debt levels, it’s clear that much needs to be done to optimise the health service’s £31bn estate – which, at £7bn yearly management costs, is the third largest NHS expenditure after staffing and drugs.

Perhaps in part due to this unresolved issue, a recent Localis report pitching a series of practical ideas to reform NHS finance was welcomed by several cross-party heavyweights, including London mayor Sadiq Khan, Lib Dem health spokesperson Norman Lamb MP, and NHS Confederation chair Stephen Dorrell. 

Barriers to transformation 

The report emphasised how the NHS estate is “vast but used inefficiently”, even despite government programmes such as One Public Estate (OPE). For example, it said a major East Dulwich Hospital site was granted outline planning permission in 2003, but has been left unused since the hospital closed down 10 years ago. 

This, the report argued, is both expensive and an obstacle to local transformation and new models of care – despite these being the health service’s hallmark ambitions for this Parliament. Better managed land would also create revenue-raising opportunities, either through one-off receipts or long-term income streams in redeveloped areas.

Nationwide rationalisation 

As well as sticking to higher estate management standards, as previously advocated by Lord Carter’s major review of NHS efficiency earlier this year, Localis said local areas should consider rationalising all local NHS estate into one body. 

“As in Sweden – and similarly to Crown Estate – this could be transferred to a holding company structure that is arm’s length of the state, which then works alongside local authorities and one or more private sector partners,” the report argued. “Alternatively it could be led by a network of providers and local authorities working across a sub-regional geography, as is the case in north London.” 

Microcosmic examples of this are already cropping up around the country, most notably in London and Greater Manchester, the only two areas to sign up for a health devolution deal so far. Five north London boroughs have already agreed to collaborate in their estate strategy to share buildings. In Greater Manchester, the ongoing £6bn health devo implementation is sponsoring a city-wide reform of estates strategy, with an NHS Estates GM Delivery Team working alongside public sector partners to deliver an ‘OPE approach’ to property management. 

One Public Estate and STPs 

Bruce Mann, the executive director of Government Property Unit, which oversees the nationwide OPE programme, argued that the scheme is one of two possible routes to tackle the NHS estate problem, despite the Localis report arguing it is not delivering change “quickly enough”. 

He said: “The NHS has not historically done as much as central government in terms of rationalisation and utilisation of land and property – although you’ll see from Simon Stevens that he’s got some very significant developments going forward to do more and better. 

“There are two ways of tackling the NHS estate. The first is through the OPE programme, which is about saying to health bodies – and it is starting to happen now really quite well – in a locality: bring your assets to the table and let’s have a conversation. This is especially in the context of integrated health and social care and how we can best serve the citizen between local authority services and health services.”

But Mann argued this must also accompany a top-down approach by the Department of Health and NHS England through their flagship sustainability and transformation plans (STPs), which bring together health and social care bodies to transform the entire care journey locally. “There’s been a lot of work over the last year within the health family looking at what estate they have got, and how it might be used in the future to meet projected clinical need,” he added, “and that will be brought together inside the STPs.”

FOR MORE INFORMATION

To access the Localis report, visit:

W: tinyurl.com/NHE-Localis

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