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Q&A: NHS Property Services (‘PropCo’)

NHS Property Services Ltd launches on 1 April 2013, with one of the largest property portfolios in Europe – a quarter (25%) of which will be made up of GP surgeries. The company was set up by the Department of Health to develop and manage more than 3,700 assets covering estate, property and facilities which will transfer from Primary Care Trusts and Strategic Health Authorities.

The aim of the new organisation is to firmly retain public sector values with added commercial discipline - with all cost benefits clearly ploughed back to the NHS.

Simon Holden, chief executive of NHS Property Services, responds to key questions set by Dr John Allingham, a GP in Dover and medical secretary at Kent LMC.

Q. How will NHS Property Services, a national organisation, attempt to address issues at a local level? (For instance, how will it accept feedback from GPs?)

NHS Property Services will actively seek feedback from GPs and others through local and national networks. A ‘customer board’ is also planned.

The company structure has been set up to support this with through its board and a small national team, plus a regional structure mirroring that of the NHS Commissioning Board. The company will have a small headquarters and regional office in London, as well as regional offices in Manchester, Cambridge and Taunton. Some 27 area team co-ordinators have been appointed and they will work closely with GPs and other tenants. Staff will also be in local offices and at individual sites.

NHS Property Services will work with the new commissioning bodies and health and wellbeing boards at a regional and local level to ensure that the estates needs of the local NHS can continue to be met. Initially, at a local level, it is intended to continue with the existing structural arrangement that PCT clusters currently have in place for the operational management of their estates and facilities.

Local offices will act as the first port of call and main contact point for the vast majority of our customers. The details of these local offices are available on our website,

Q. How will NHS Property Services budgets be divided?

All operational costs will be allocated to a building by NHS Property Services, based on information provided by PCTs.

In the early days the focus will be very much on ensuring continuity for tenants and also providing clarity on costs and leases. A memorandum of understanding has already been set out which clearly states that an extensive review and audit of current costs will be undertaken as a priority during the first year of business.

One of the benefits of being a national organisation is that NHS Property Services will be able to command better economies of scale on some key commodities such as water, electricity and gas, with all cost benefits returned to the NHS.

Q. Will NHS Property Services prioritise premises development according to national agendas on health? (For instance, will it be easier to develop GP premises in deprived areas?)

NHS Property Services will work closely with partner organisations such as the NHS Commissioning Board to support national priorities but with clear local accountabilities.

One of the opportunities for NHS Property Services will be its ability to introduce genuinely sustainable and environmentally friendly solutions to NHS estate, something which has proved challenging in the past due to the cost and expertise required at a local trust level.

Q. Will there be any flexibility to adapt regulations, or will it be a ‘one size fits all’ approach?

While standard documentation may be developed and adopted, individual leases will be negotiated taking into account individual buildings and local circumstances.

An extensive review and audit of current costs will be undertaken as a priority during the first year of business and this will have a core aim of ensuring consistency across the country with regard to the costs being charged for maintenance, services and leases. This sort of standardisation is a positive move and will leave NHS organisations in a far better position to plan and organise budgets.

Any flexibility will be used to ensure that where there are individual needs or requirements in regards to a property, appropriate and timely decisions can be made to ensure that it is providing a useful, safe and modern space to either treat patients and provide a good working environment for NHS staff.

Q. Taking into consideration many of the same people from PCT premises teams will be in NHS Property Services, how might the new organisation attempt to tackle existing challenges in premises management? (For instance, the difficulties in negotiating Current Market Rent, or other examples where premises disputes have been referred to the NHS Litigation Authority.)

NHS Property Services will be a national organisation with a local presence so whilst there will be familiar faces working at a local level, these professionals will be working to a new national remit and reporting into a new structure and organisation.

Support to local teams will be increased and they will have access to services and expertise not previously available to them. It will be a priority for NHS Property Services, and indeed has been during its period of set up, to find resolutions to any existing disputes.

Effective estate management supports the delivery of effective health care. Disputes such as these must not impact the day to day running and provision of healthcare services to patients. Having a dedicated, nationally supported, property management team in place, resourced appropriately, will not only ensure fast resolution but should help prevent such issues from developing.

Q. How might NHS Property Services increase ‘profit’ from their assets and how might this affect GP partners?

NHS Property Services has not been established to make a profit – any benefits which arise will be passed back to the NHS and customers. As previously described, the organisation’s ability to buy at a national level will result in a number of cost savings that will be passed back to the customer.

The company will inherit a wide range of assets and not all will be up to standard. These will be reviewed over time to ensure the portfolio is fit for purpose.

NHS Property Services Ltd will rightly be expected to deliver best value for the NHS in an open and transparent way. Any future proceeds from sales of property which have been deemed redundant or no longer of any practical use to the NHS, will be ploughed back into the service to fund further modernisation and improvement of those properties being used by the NHS. In particular the organisation aims to improve the sustainability and ecological credentials of NHS properties, so any additional funds raised could be used to support such work.

Q. Will there be any changes to issues such as heads of terms or leases in the transfer arrangements?

All tenancy agreements and leases, in other words all documented occupations, will simply move across as part of the transfer arrangements. The company is keen to place arrangements which are undocumented at present on a proper footing, using either the memorandum of occupation or a longer term lease.

NHS Property Services Ltd is absolutely committed to a smooth handover of the estate, buildings and properties that will transfer from PCTs and SHAs to the new company in April 2013 and it is been clear that current leases will transfer unchanged. The organisation is aiming to ensure stability and clarity for all NHS organisations. The running costs charged to successor bodies and tenants next year will be based on the total current costs incurred through PCTs and SHAs.

The running costs charged to successor bodies and tenants next year will be based on the total current costs incurred through PCTs and SHAs.

Q. How might the district valuation service change? (For instance will NHS Property Services be able to appoint its own valuer in the future?)

NHS Property Services has no intention to create its own internal valuation service. It will procure valuation support in accordance with procurement regulations.

Q. How will the introduction of NHS Property Services affect property-owning partners?

It won’t, unless those partners decide to commission services from NHS Property Services.

Q. What advice would you offer to new partners hoping to buy in to existing premises?

Investment in owner/occupier premises by GPs will not involve NHS Property Services.

Q. How will the introduction of NHS Property Services affect particular types of premises of GP premises, for instance converted residential premises?

Over time, should CCGs wish to invest in the improvement of premises, NHS Property Services will be able to provide professional skills and expertise to assist with this. The company will not however be involved in investment or disinvestment relating to GP premises which it does not own.

Simon Holden is the chief executive of NHS Property Services and Dr John Allingham is a GP in Dover and medical secretary at Kent LMC.