NHSPS Update & Strategic Estate Partnerships

Update &
Strategic Estate Partnerships
Lester Wagman
Healthcare Environment & Infrastructure
Southampton, September 2013
PropCo

NHS PropCo – Principles (recap)
• Presumption that assets will be transferred to relevant NHS service providers:
- Foundation NHS acute/MH Trusts
- Aspirant Community Foundation NHS Trusts
• Full lists of property for proposed transfer to these organisations currently under consideration
by DH but some Transfer Orders made
• All other estate to be transferred to NHS Property Services Ltd.
• Likely to include assets formerly held/controlled by PCTs/SHAs:
- Administrative/support services buildings
- Operational community care property:
- in multiple occupation
- where the NHS provider is a minority occupier
- where the community provider is a non-NHS provider
- Operational primary care property, e.g. some GP surgeries
- NHS interests in established JVs such as LIFT Cos
- Surplus property (Trusts encouraged to release this ASAP to support HCA new homes initiative)
2

What needs to be done (recap)?
Nationally
• Structure of eventual PropCo(s)
- Role of LIFTcos
- Governance arrangements
- Interim resource planning
• Procurement process
• Transfer orders
Locally/Regionally
• Housekeeping
- Compliance/Backlog maintenance
- Transfer/novation of contracts
- Lease management issues
• Strategic estate planning
- JVs & SEPs
- Shared/divided sites
- Capital programme
- Transfer valuations
3

Update Nov 2012
Letter from Simon Holden (CEO)
„Core‟ landlord and advisory services that Primary Care Trust estates
teams currently provide or manage:
• Strategic estates management
• ƒ Property management advice
• The operational delivery of
[property] services:
• Refurbishment and maintenance
• Emergency/on-call repairs
• Quality assurance
• Compliance with statutory
regulations (such as fire, asbestos)
• Non-urgent breakdowns (electrical,
mechanical, building)
• Planned preventative maintenance
• Health and safety, fire safety and
risk assessment (landlord only)
• Mechanical and engineering services
4

• ƒ Charles Howeson, Chair
• ƒ Simon Holden, Chief Executive
• ƒ Caroline Rassell, Finance Director
• ƒ Pamela Chapman, Acting Director
of Asset Management
• ƒ Alan Farmer, Director of Corporate
Services
• ƒ Andrew Millward, Acting Director
of Communications and Business
Services
• ƒ Chief Operating Officer, Vacant
• ƒ Kathryn Berry, Regional Director,
North
• ƒ Martin Royal, Regional Director,
Midlands and East
• ƒ Tony Griffiths, Regional Director,
London
• ƒ James Wakeham, Regional
Director, South
5
Update April 2013
Leadership team in place:

Update 2 April 2013
Letter from Peter Coates (on behalf of Secretary of State)
To: landlords, sponsors and/or funders
Setting the Scene
• On 31st March 2013, Primary Care
Trusts ceased to exist
• A significant number of properties
previously owned or leased by
Primary Care Trusts (together
with all resulting liabilities) will
transfer to NHSPS
• The Secretary of State for Health
holds all of the shares in NHSPS
Statement of Principle
• SoS acknowledges fundamental
importance of…good quality
premises [for primary health]
• enshrined in NHS Constitution
pledge :
• “services provided in clean and
safe environment that is fit for
purpose, based on national best
practice”.
6

Update 2 April 2013
NHS PS Role & Responsibility
• NHSPS to manage NHS' interest
in large number of properties as
best way of ensuring a coherent
strategy during the period of
transition
7
Mixed Message
• NHSPS is not subject to s.70 of
NHS Act 2006 (any outstanding
liabilities of a PCT would survive
dissolution) – Gulp!
• “However, it would be wrong to
think that this signifies any
reduction in the commitment of
SoS to the assets and liabilities
that NHSPS will inherit”

Update 2 April 2013
SoS Role & Responsibility
• SoS is sole shareholder in NHSPS
- role taken very seriously
• Departmental director appointed
to the board - governance
protocol requires approval of
director to all board resolutions
• SoS will continue to ensure the
continued good running of
NHSPS & responsibility of
directors 8
“Untenable” that SoS would:
a) Allow NHSPS to run at risk of
administration/insolvency
b) Not take any action to remedy
administration/insolvency
c) Wind up NHSPS without first
transferring assets to “entity of
equal covenant strength” (i.e.
another NHS company, NCB or
CCGs)

Update 2 April 2013
Explanation of funding for NHSPS
• PCT PFI properties yet to transfer
but interim budget funding
arrangements now in place
- NHSPS entitled to receive any sub-
lease income
- NHS CB or relevant CCGs to meet
any funding shortfall
• Post 2015 Primary Care PFIs “will
be funded increasingly directly by
the occupants”
• “It is recognised that the
occupants' contracts for providing
services to the NHS will need to
be funded appropriately”
• “The anticipated move towards
payments flowing increasingly
through occupants is to incentivise
the system to optimise property
utilisation and value for money”.
9

From the coal face
• Land registry transfers went “eerily quietly”
• Some anomalies have emerged - some things may have gone
to wrong place
• Little or no activity on disposals or asset management
• Estates services still being provided to NHSPS by some
transferor (acute/MH) Trusts
• Resourcing - area team leaders in place but NHSPS still
recruiting
11

From an outsider’s perspective
• Capacity Struggle
• 30-40 Local Area Team Co-ordinators appointed by NHSPS
• Interaction with NCB & CCGs still unclear
• GPs rushing to get leases in place [or not in some cases]
• DH focus on making sure Transfer orders in place
• Traffic light triage of transfer risk issues: 1st 100 days, 2nd
100 days etc.
• CHP has similar issues with LIFT estate
• NHSPS likely to be looking for „quick wins‟ but
• Nothing controversial expected pre-election!
12

All Going Well?
• Some assets may have gone to wrong place
• Some sweeper provisions in place
• Legal charges vis a vis capital grant agreements
• Option to tax (VAT)?
• SDLT?
• Interim funding announced for 2013/4 but funding gaps
emerging - commissioners to take on in short term
• HCA Public Land Programme
• Funding of GP premises impovements
13

What is a Strategic Estate Partnership?
• No single definition
• Often whole estate PPP principle
• Can be specific assets with option to widen scope
• Assets taken off balance sheet but can be just contractual
• Often includes asset management and [some] FM
• Can also include healthcare & support services
• Private sector partner brings development skills & finance
• With agreement can be extended to include other public sector assets
14

SEP spectrum?
• Contractual/framework (e.g. Lancashire)
• Limited asset (e.g. Southend, Yeovil, Salisbury)
• Scheme specific (e.g. Cambridge, Kings College)
• Sample scheme led (e.g. CWP, IoW)
15

Southampton CEDP
• MERA
• Parking
• PPU
• Patient Hotel
16

Patient Hotels
• Planned early admissions
• Patients waiting discharge
• Relatives and friends
17

Patient Hotels
18
• Should there be any ongoing nursing care be provided?
• If so, who should provide this and what should be their responsibility?
• Should an emergency call button be provided?
• If so, who should respond and what should be their responsibility?
• How long should the patient be allowed to stay
• What happens at the end of this period?
• Who will pay for their accommodation, meals and care (and for how long)?
• Who will be responsible for the maintenance of the environment?
• Who will be responsible for the provision of hotel services?
• Under what circumstances and who decides if the patient should be readmitted to
hospital?

Commercial Option
• Forecast room
commitment
• Fixed discounted day rate
• Accounting period
adjustment
19

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