Private capital has a role to play in supporting NHS estates, says report

The British Property Federation (BPF) has published its primary and secondary care policy document calling on the Government to work with industry to explore how private capital can be used to reduce public funding pressures, drive innovation and support sustainability to help provide the improved estate that the NHS desperately needs.

One of the challenges the NHS is facing is its aging and unfit estates, with an estimated £11.6bn maintenance backlog, 63% of the estate over 30 years old and 20% of primary care facilities described as unfit for purpose.

The Independent Reconfiguration Panel’s evidence to the Darzi review also references the poor state of the NHS estate as a key driver for service reconfiguration plans. Operational challenges mean capital budgets have frequently been re-allocated to cover shortfalls in day-to-day spending, which has prevented long-term planning and investment.

Several factors limit private capital funding says the report, including a lack of system wide thinking with different funding models for primary and secondary care, accounting barriers, viability challenges, and a lack of investment routes.

Estates are integral to the NHS

The report emphasises the critical role of healthcare estates in delivering high quality care and support from the local GP through to the specialist and acute care provided by hospitals. It explains that well maintained and modern facilities are essential for effective healthcare delivery and support staff recruitment and retention. A view shared by Dr Claire Fuller in her 2022 report entitled: Fuller Stocktake.

Government should work with industry to support investment

For the benefits of private capital to be fully realised, BPF identify seven areas in which the Government can provide support.

 At a glance:

1. Manage NHS Spending Limits and Capital Constraints: Current constraints are restrictive and prevent proper utilisation of budgets and private capital funding.
2. Establish Viable Rents: Set rent levels which are reflective of the current financial conditions to encourage further investment.
3. Revise Revenue Allocation: Reform revenue distribution to enhance estate delivery.
4. Promote Local Decision Making: Avoid excessive centralisation and support local decision making. A view shared by Dr Fuller, Sir Robert Naylor and the King’s Fund.
5. Encourage Third-Party Partnerships: Foster collaborations with third parties to develop primary and secondary care facilities.
6. Facilitate Public Sector Partnerships across organisations to maximise investments: support partnerships between the NHS and other public sector organisations for example, Universities.
7. Support Infrastructure Needs: Address additional infrastructure requirements through planning and working more closely with Government Agencies such as Homes England.

Jonathan Murphy, CEO of Assura and Chair of the BPF Healthcare Committee comments that they “stand ready to work in partnership with Government, the NHS and others to deliver an NHS estate that is fit for the future”.

Read the full report here: https://lnkd.in/gPN8QyAU

Real estate partner, Jennifer Lewis is a member of the Healthcare Committee and co-authored the report with other members of the BPF committee.