Right care, right place: why NHS estates matter

Let’s stand back and think about why estates issues matter to the NHS in the first place. It’s not just a matter of changing the lightbulbs on time (important though that is). Getting the future health care estate right is of similar strategic importance to boards as getting the workforce right, and poses some significant but different challenges.

An effective organisation ensures that people with the right skills and experience are able to work in an environment that makes it easier for them to do their job properly. An effective system sees the efficient use of their combined estate and other infrastructure, such as IT, as a significant enabler to partnership working, and the creative use of estate can release funds to be reinvested in patient care.

Most importantly, getting the estate right makes a difference to patients. As well as improving the experience of care, we know that being cared for in a good environment can actually improve health outcomes. 

So why does the NHS find it so difficult?

It’s not that people don’t think about it. A number of parts of the NHS have bold plans to change services, reconfigure hospitals and develop primary care. Trust board risk registers also frequently show issues with backlog maintenance that pose a significant threat to services in some places. 

A common response to these challenges is that there is very little public sector capital available. A large proportion of the annual allocation is already given to a small number of schemes and, as reported in the HSJ in May this year, the Department of Health will continue to make capital to revenue transfers to support day-to-day NHS running costs until 2019/20. However, as the recent report published by Robert Naylor illustrated, there are some wider issues to consider.

Perhaps most fundamentally, successive reorganisations have significantly affected the NHS’s in-house strategic capability to think about estates. The ownership of the NHS estate is scattered across 250 trusts and foundation trusts, NHS Property Services and Community Health Partnerships. In addition, the NHS leases estate from local authorities, private companies and PFI providers, and hundreds of individual GP practices own their own premises.

Unlike workforce development, no organisation has strategic responsibility for estate development across a system, and few individual organisations have board- or executive-level strategic estate leads able to engage effectively across a system or with other partners.

Those partners include the public. NHS buildings – hospitals in particular – are iconic symbols of the NHS. Public opposition to change affecting the buildings which people identify as places of safety and security can be significant, and the NHS has not historically been terribly successful at working with local communities to see such change as a gain rather than a loss.

During the recent election campaign there was also some backlash against a perception that the Naylor report was recommending the ‘privatisation’ of NHS estates. Full Fact published a very helpful clarification of the facts responding to those concerns in June this year.    

But capital constraints are real, and so there is also an important question about how to supplement the capital resources of the NHS in a cost-effective, straightforward way, which avoids some of the real or reputational pitfalls associated with previous attempts such as PFI (Private Finance Initiative). Solutions also need to comply with the complex rules about what constitutes a call on the Department of Health’s capital expenditure limit.

Opportunities ahead

Notwithstanding these constraints, we believe there are real opportunities to develop imaginative local solutions. These may include partnerships with local authorities or other non-traditional funders, making the best use of the surplus estate through turning property into income rather than simply selling it off, and putting in place mixed developments that take advantage of the ‘air space’ above an NHS building.

Over the course of this year we’ve asked a number of people to consider these issues and give us their thoughts on current problems and the potential solutions, and we’ll be publishing some comment pieces in the coming months.

We’re also pleased to say that in the autumn we’ll be working with the Realisation Collaborative to bring together teams from a small number of local areas and national experts in a series of workshops designed to help the teams develop viable, implementable place-based estate plans, and where necessary propose changes in the wider policy and regulatory environment that might be required to support them.

More information on this programme will be available shortly but if you are interested in being involved, either with your local partners or as an expert advisor, please contact events@nuffieldtrust.org.uk