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Practices in NHS premises to get perpetual 50% subsidy under CCG plans

Local GP practices based in NHS buildings will receive a minimum 50% subsidy towards facilities management and service charges on a permanent basis, a CCG has announced. 

NHS Sunderland CCG has agreed to increase and extend subsidy it currently offers to practices occupying NHS estate in a bid to offer ‘certainty’ to GPs and help address financial pressures due to NHS Property Services (NHSPS) charges.

Pulse has long documented disputes over premises service charges since reporting in 2016 that several practices saw their fees hiked by up to 400%, while more recently a practice’s annual service charge increased from £14,000 to £48,870

The BMA and NHSPS are in dispute around these charges, but the CCG suggested this might offer a solution. 

Since March 2018, Sunderland practices occupying NHSPS estate have received subsidies ‘in relation to facilities management and service charges’, which was agreed for a 10-year period, based on ‘a fair shares allocation.’ 

Board papers published last week revealed that Sunderland CCG has now agreed to offer subsidies ‘in perpetuity’ in light of some practices raising concerns over uncertainty after the end of the 10-year period. 

The move will also increase the subsidy amount to a minimum of 50%, which will be ‘simpler and easier’ for practices, according to the CCG. 

Previously, subsidies were retrospectively confirmed and recalculated each year based on a ‘fixed financial envelope’ from NHS England to the CCG. The most recent of these was only 45% of the total costs charged to practices by NHSPS. 

The papers said: ‘It has been highlighted that the retrospective confirmation of subsidies for each financial year results in practices having uncertainty around the funding they will receive when NHSPS issue invoices and request payment of charges. Subsidies are currently recalculated each year due to the fixed financial envelope which was transferred by NHS England to the CCG.

‘It is proposed that an alternative approach is adopted whereby a commitment is made to issue a subsidy based on a fixed percentage of the charges raised to practices from NHSPS for facility management and service charges.

‘The most recent subsidy confirmation for 2017/18 represented c45% of the total charges raised to practices from NHSPS though this rate can vary from year to year. As such it is proposed that the CCG provide a minimum subsidy of 50% in each financial year.’

It added: ‘The majority of practices have GMS contracts which are held in perpetuity and therefore this proposal would provide certainty to practices on an indefinite basis.’

It follows threats of legal action from the BMA against NHS Property Services, after their ‘astronomical’ rises in charges faced by GPs in recent years. The BMA also warned practices not to sign leases unless they fully understand the terms and liabilities

An NHSPS spokesperson said: ‘We always work with our tenants and local partners to help address affordability issues and are pleased that following constructive discussions with Sunderland CCG we have come to this agreement, which makes vital real estate and facilities services more affordable for local GPs.

‘NHSPS’s remit is to support the NHS estate so that its people can deliver excellent patient care in modern and well-maintained facilities across the country. This agreement will ensure that we can recover these direct costs for providing essential services for the NHS in Sunderland such as cleaning and repairs.’

Last month, the National Audit Office found that NHSPS’s approach to collecting lease fees does not work ‘effectively’, highlighting that the outstanding debts owed by tenants – including GPs – had almost tripled in five years

Pulse recently reported that NHS England will consider ‘relieving GPs’ of the worry of estate liabilities and instead bear most of the costs itself

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