Historic GP premises service charges unlikely to be written off, says NHSPS chief
NHS Property Services are ‘tasked with’ operating on a ‘full cost recovery basis’ when it comes to GP service charges and historic charges are unlikely to be written off, its chief executive has told MPs.
During a session on neighbourhood health estates today, the House of Commons Health and Social Care Committee questioned NHSPS CEO Martin Steele on whether historic service charges could be feasibly written off and whether the Government would consider it.
It comes after calls for urgent Government reform of the charges, which have been described as ‘unaffordable’ and ‘excessive’, with the BMA warning that they have pushed GPs to hand back their contracts.
Mr Steele acknowledged that the charges represent a ‘challenge’ for GP practices, but said that NHSPS understands estate charges ‘intimately at a property level’ and it works with practices to ‘agree a go forward position based on what’s going to cost going forward’.
He said that while NHSPS has previously written off historic service charges in some cases, ‘just writing off historic debt’ doesn’t make service charges affordable going forward.
Pulse has reported on many GP practices being in dispute with NHSPS over service charges since 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.
The BMA has demanded urgent Government intervention over the charges, which have caused deep financial instability and forced some practices to hand back their contracts. The union warned that, without urgent reform, more practices could be forced to hand back their contracts.
And the NHS Confederation said the Government should consider ‘abolishing’ NHSPS and writing off GP debt.
Thurrock MP Jen Craft told the session that it will ‘probably be no surprise’ that some GP practices in her constituency are having issues relating to historic service charges, and said that ‘over half a million pounds of historic service charges’ is ‘not affordable’ for most GP practices.
She told Mr Steele: ‘You seem to be implying that that’s more of a decision for potentially the Secretary of State, or a ministerial decision, as to whether or not they could be written off or changes to that could happen.’
Mr Steele said: ‘I didn’t mean to imply that. If I did, I apologise. In terms of the service charges we are tasked with operating on a full cost recovery basis. We charge our practices for the services they take.
‘They can provide their own services, and we will help them move to another provider if they want to. There’s no question about that. They’re not contracted to us, so they can do that.
‘It’s an affordability question, and it goes back quite some way, actually, probably to 15/16, 16/17, and the discussion around subsidies.
‘So we work with those practices to itemise the charges that we’re making for service charges in a lot of detail, and very often the end of the conversation is: “look, I understand, I see that perhaps it does represent value for money because I don’t want to go somewhere else, but are still not able to pay because I’m not getting reimbursed for it”. And that’s a challenge.’
Mr Steele added that NHSPS data on service charges are in ‘very good shape’.
He said: ‘We understand our estate charges intimately at a property level. So if this is historic debt, what we aim to do with our practices to agree a go forward position based on what’s going to cost going forward.
‘You can take it from us or someone else. We can then agree a lease with you, if there’s not a formal lease in place, and then we can do something sensible on the historic charges go back a long way. The challenge we have is getting that go forward position.’
He added that ‘just writing off historic debt’ doesn’t make service charges affordable going forward.
He said: ‘We do a settlement agreement based on we’ve agreed what the go forward position is. We’ve got a document lease in place, and everyone’s happy to pay for value add services. If we can’t get to that point and it’s unaffordable going forward.
‘Just writing off the debt doesn’t make it [affordable], all you’re doing is building debt going forward. So we have to have that agreement up front.’
The BMA has previously received ‘hundreds of reports’ from partners who believed they were being charged ‘unjustly’, with some practices becoming ‘unviable’.
It said that GP practices should seek independent legal advice before agreeing to any debt settlements with NHSPS.
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.
NHSE recently announced a scheme which invites hospital trusts to bid for GP practice premises owned by NHSPS but which excludes GP practices and local authorities, and the BMA has criticised what it perceives as the Government placing secondary care in a position to lead on neighbourhood health services.
