Health and Social Care Committee
Oral evidence: Delivering the Neighbourhood Health Service: Estates, HC 237
Wednesday 1 July 2026
Ordered by the House of Commons to be published on 1 July 2026.
Members present: Layla Moran (Chair); Danny Beales; Josh Fenton-Glynn; Andrew George; Joe Robertson.
Questions 149-229
Witnesses
I: Dr Jamie Hynes, Vice President, Member Standards, Royal College of General Practitioners ; Dr Louisa Wood, Chief Operating Officer, Mereside Medical; and Rob James, Group Development Director, Primary Health Properties plc.
II: Bill Shields, Executive Director of Finance, NHS Derby and Derbyshire Integrated Care Board, NHS Lincolnshire Integrated Care Board and NHS Nottingham and Nottinghamshire Integrated Care Board; Sam Pluckrose-Oliver, Policy and Public Affairs Manager, Locality; and Joe Garrod, Strategic Director of Place, London Borough of Waltham Forest.
Witnesses: Dr Jamie Hynes, Dr Louisa Wood and Rob James.
Q149 Chair: Welcome to the Health and Social Care Select Committee. This is the second of our hearings on delivering the neighbourhood health service, with a particular focus on the estates. We will start with a panel talking about primary care. Can you please introduce yourselves and what you do?
Rob James: I am Rob James from Primary Health Properties plc. We have invested in primary care for over 30 years, and we currently manage and own over 1,000 properties, 900 of which are in England. We see ourselves as a key strategic partner to the NHS.
Dr Hynes: Hello there. I am Dr Jamie Hynes and I am a GP in the west midlands, in the beautiful Black Country. I am also the RCGP vice-president for member standards. To declare an interest, I am also a buildings owner of the two sites where we run our surgeries.
Dr Wood: Good morning. I am Louisa Wood, the chief operating officer of Mereside Medical, which is a group of three general practices in east Cambridgeshire. We serve about 45,000 patients. I am also the co-director and PPIE lead of the Greater Cambridge and Suffolk Commercial Research Delivery Centre for primary care, and one of our sites, Staploe medical centre, is the lead practice for the Ely South primary care network. We have a long history, across our primary care networks, of delivering at the neighbourhood level.
I also hold estates as part of my portfolio. We are both owners and renters, and we have a wealth of experience in trying to get new build schemes over the line, particularly with Staploe, which I provided evidence about. I am pleased to be here to share our insight.
Q150 Chair: Thank you. In the context of neighbourhood health, as you know, one of the three shifts is the shift to the community. From your perspective, as doctors, what does that mean for your practice and the practices around you? In your brain, what does it mean?
Dr Hynes: We are all excited about the possibilities in moving services from hospital to community, but to deliver on the grander promises, GPs need greater premises. The Darzi report revealed that one in five GP practices predates the NHS, and 53% of them are more than 30 years old. They were built for the purpose at the time they were built. We are now faced with a situation in which, just with existing needs, 74% of practice managers say they cannot recruit more GPs for a building just because of the lack of physical space.
We should then start looking at the rest of it, and what an expansion would mean. We want to make sure that we are delivering things for the future needs of neighbourhood health services, and we need the infrastructure to keep pace. We are expecting workforce plans to be published soon; is there a 10-year strategy for that? Will there be a 10-year estates delivery strategy to go along with town planning and all the new home building and things?
Q151 Chair: Can I challenge you a bit on that?
Dr Hynes: Sure.
Chair: It seems the premise is that yes, you are excited, but you are putting yourselves very much at the centre. There is some criticism that that is what GPs always do, and could it not be led by pharmacy or by other people? I will come on to neighbourhood health centres in a minute. I think Minister Kinnock said that GPs are going to be the conductors. Do you agree with that, in reality?
Dr Hynes: Completely, and if we are to be the conductors of the orchestra, we are going to need the instruments and the concert venues.
Q152 Chair: Do you think you should be the conductors?
Dr Hynes: I think so. Because we have historical breadth in our outlook on patients and patient care, and the gatekeeper role in the NHS, we have the responsibility to be aware of resources, using things appropriately, doing things efficiently and making sure that we can increase productivity.
If you look at where we were before the pandemic, we are delivering 20% more appointments in general practice at this point. There were 376 million last year—it felt like they all came to my on-call on Friday! We are producing more, and our patient populations are growing, and we are able to meet that even though the number of GPs is staying fairly flat compared with hospitals.
Q153 Chair: I met a community pharmacist in Abingdon who said that the local GP practices do not have a good relationship with them—in fact, it is a little bit like, “We do not want to give this up.” We will come on to funding at various stages during the session. Other people who are as well-placed to deliver some of the services that GPs deliver also have estates and would desperately like some of that business. Do you recognise that tension? How do you manage it?
Dr Hynes: I think so. There is no objection to the co-location principle of making sure that people are delivering services for patients under a single roof.
Q154 Chair: But this is a separate pharmacy. It would mean that you would not need the extra space in your GP practice, because those services would be delivered somewhere else and by someone else. Is that a blind spot for GPs—that you do not always think that way?
Dr Hynes: We are not always thinking that way, but it comes down to our closeness and proximity to the patients and the community. There is a lack of direct financial interest when a patient sees their GP, which puts us in an advantageous position to build trust. Obviously, then, that is where they feel safe and will come to confide their deepest darkest fears when it comes to quite serious health problems.
Q155 Chair: To push back, that would be same with Pharmacy First, as the patient does not pay. Louise, what is your perspective?
Dr Wood: Just to clarify, I am not a GP; I am a research doctor.
Chair: Forgive me.
Dr Wood: No, it’s fine—you can still call me doctor. I just don’t want you to think I am a GP.
On the specific question about what the neighbourhood shift means, for us it is about the vision for general practice and primary care as a whole. On the pharmacy point, we work really closely with our pharmacies. We have one co-located in our practice, and we work really closely with the others that operate Pharmacy First. I do not perceive there to be a tension there, because there are clear differences in what GPs are able and qualified to do. As Jamie said, a massive breadth of competence defines general practice, and that is very different from what defines the pharmacist’s scope of practice. It is about working well together, but I do not think it is either/or at all. The scope of a GP practice is the broadest out there. GPs are the consultants of generalism, and they hold the liability for that.
Q156 Chair: The example I give you is vaccination. We had a one-off session on vaccination and we made a very strong recommendation that the Government need to work with pharmacies to deliver that at scale. One of the things I know happens is that there is sometimes a little bit of pushback from GP surgeries, because they rely on some of that income. I am afraid that some of this is a little bit income-driven, so there is that tension. I would not say it is clearly, 100%, black-and-white defined; there are some grey areas. Do you agree?
Dr Wood: There are definitely grey areas, but I will use our experience delivering the covid vaccination programme as an example. We were an early adopter and delivered 150,000 in a really short space of time, working across all six of our PCN practices at the time. That was about being clever with the traffic flow, the patient flow through the building. Pharmacies are not set up for that kind of delivery model, because they are generally much smaller.
For the other seasonal vaccination campaigns, with footfall through pharmacies on a daily basis, there is an opportunity to get vaccinations delivered to those patients. I do not think any GP would have an issue with that. Similarly, when patients come into the practice, especially with children’s vaccinations, or people coming in for baby checks and other health checks, there are lots of opportunities to try to improve the overall vaccination rate. It should not be seen as either/or.
The access to the funding scheme should be fair. At times, we have been allowed to invite earlier than pharmacy, and vice versa, so that is where some of the tension probably comes from. But I think that is appropriate. We cannot mop everyone up. We can run a campaign and then the pharmacies can also deliver their portion of the patients who come through them.
Q157 Chair: But in your brain it is the GPs starting it and the pharmacies then mopping up. I am just reflecting back the words you just said.
Dr Wood: We all do mop up. We are trying to mop up the few who have not come in through the explicit invites, but if pharmacies and practices can issue invites at the same time, that is absolutely fine. I do not I do not think it needs to be a problem.
Q158 Chair: I appreciate that, but we have gone down a bit of a rabbit hole. As you will be aware, the neighbourhood health centres are the vision in the 10-year plan. That seems to be the thing. Rob, do you have a view? How do you see GP practices and the neighbourhood health centres sitting together? Are they the same thing but with a bigger footprint? In your mind, how does that work?
Rob James: It is important to look back to when Lord Darzi first looked at the Darzi clinics in 2008, and to the polyclinics that came from that—
Chair: It is interesting how ideas come back around.
Rob James: Absolutely. This has come back around. We did have some successes then, and we fully support the direction of travel this time in terms of multi-occupancy buildings. We also support the fact that GPs should take the lead. They are innovators in the NHS. They are independent businesses. They run very efficiently, given that 90% of patient contact is in the primary care sector via GPs. That shows the level of efficiency that can be driven in.
The structure of how real estate fits around the neighbourhood health centre is going to be interesting, on the basis that sitting under that are a plethora of different contract lengths. How do we structure that to make sure that the innovators in the system can grow services and adapt? We all know that the one thing that is certain is change, and that whatever we do now, in 10 years’ time the model will be different. Therefore, the real estate needs to change and to adapt to how providers need to provide the service.
Q159 Chair: We will come back to that—we saw a lot of evidence on that in Cornwall. The shift to community is about buildings, yes, but in our visit to Cornwall we saw great examples of services being provided in community centres, on high streets or in libraries. Jamie, is that something you do?
Dr Hynes: Yes, certainly through the pandemic. We can use vaccinations as an example. For our most difficult-to-reach vaccination populations, where there is scepticism about vaccines or the need to deliver them, you might choose community-based resources such as faith-based venues, community centres, schools or the local gym.
Q160 Chair: Is there anything else you could do from those kinds of venues? We know that going right to the heart of parts of our community that are historically underserved with a range of different services helps to drive down inequalities. Do you have concrete examples of things you do that help with that?
Dr Hynes: Yes. I am in a deprived area in the Black Country, and our vaccination rates are challenging. We use our own surgery, as we own our building. We love our Saturday morning surgeries. It is not about getting the reimbursement for the vaccines; it is the point of contact when you can get 400 patients through a building in a morning.
Chair: But they are coming to your building.
Dr Hynes: They come to our building. It is a two-minute slot.
Q161 Chair: What I am trying to get to is the other way round. Do you go out to them? I am trying to work out the barriers to that and how we do more of that, not just for you but for other GP practices.
Dr Hynes: One barrier we have seen in the past is recording note-keeping on clinical systems when you are reaching out. That is one aspect of it. Sometimes there are issues to do with surge capacities or emergency situations. The advantage is the potential space. If you have a larger space, you can start thinking about how you can deliver group consultations and managing bigger populations of patients that you can in one patient encounter within a surgery building. Where that patient feels comfortable, they can see the engagement with local representatives, so it has that community feel and increases the sense of wellbeing.
Q162 Chair: Are the Government doing enough to encourage GP practices to think about how to get out of their building and do more things close to the community?
Dr Wood: I have to be honest that I think the potential is really narrow. The health building notes regulations exist for a reason. Our premises are subject to those regulations in terms of the spec that the building must meet to deliver our services.
Q163 Chair: Do you think they are too stringent sometimes?
Dr Wood: No. It is about infection control, fundamentally. General practice is not overly complicated—we are not building hospitals here; it is relatively simple—but the things that are in place are in place for really good reasons. It is things like the minimum room size so that somebody in a wheelchair can actually turn their wheelchair around; having space for dual access either side of a couch if you are performing a physiotherapy appointment and need to access the patient on both sides; and having private space where you can conduct confidential examinations.
It genuinely works for non-clinical community-type services, where those estates exist. In our area, it is libraries, many of which are buses—you can’t do much in a bus—or village halls. There is no confidentiality there. It is really about group, non-clinical settings. We have wellness hubs all over the locality where people come, and it is about social prescribing, wellbeing, mental health, fitness and the broader concept of wellbeing in healthcare and prevention. It is not applicable or appropriate to try to do a clinical consultation with a patient in a community setting, because you do not have the confidential space, you cannot do an examination easily—you need a couch—and there is no infection control. The rules will not be adhered to in community settings.
Lastly, as Jamie has mentioned, the confidentiality of the data is really important. You cannot access the patient record easily. You would need to VPN in to access your system, or you would have to write it down on paper, which you could then lose on your way back to the practice before you enter it into the system. It is not ideal. Although the idea is lovely and it is brilliant for building community and building wellbeing, which is all part of the preventive agenda—I am very supportive of that—we cannot move a lot of the services that we offer into those types of settings.
Q164 Josh Fenton-Glynn: I am going to ask about the way the contracts are structured to understand where things have gone wrong. If we are going to look at new endeavours like this, we need to make sure we start from the right basis. Rob, in the Committee’s evidence session with Lord Hutton, I leant quite heavily on Todmorden health centre in my constituency, which is one of the 1,059 properties in which Primary Health Properties has an interest. It is an interesting example because it is a great building that is completely underutilised. Is underutilisation a problem that you recognise, not specifically in Todmorden but in your property?
Rob James: Underutilisation is an issue generally. Looking at specifics, 1% of our estate is vacant space, in the CHP that goes up to 3.4%, and in NHSPS we have 5% vacant space. The issue in terms of blockers to progress is very interesting. The structure in this particular circumstance, is that NHSPS holds the lease. Underneath that is an underlease to the GPs. The GPs want to expand their services into areas that are vacant, and NHSPS is essentially blocking that, for reasons I really do not know. We would welcome a meeting with yourself, NHSPS and the GPs at the site so we can understand. It is to our advantage that all the space within our facilities is working to the maximum capacity.
Q165 Josh Fenton-Glynn: It is a really interesting example. I have done some personal research on Todmorden health centre—I have my notes—and it involved going through pages and pages of stuff, because it is such a complex ownership structure. Does the complexity of the public-private partnership structure make it more difficult for us to utilise those spaces?
Rob James: It is worth noting that the model that PHP works in predates PFI. We work under a set of guidance called the premises costs directions, which are appended to the GMS contract. That allows for rental reimbursement to flow through that contract structure, so it is not PFI as such, because—
Q166 Josh Fenton-Glynn: Can you explain the words “rental reimbursement to flow through that contract structure”?
Rob James: Yes. Under the premises costs directions, GPs and GP practices can get all their rent reimbursed under the GMS contract. We utilise that part of the legislation to develop new facilities and have that pass-through cost. Another important note is that all our leases will essentially say that the passing rent is the reimbursed rent, so there is an opportunity for us to charge additional rents to GPs that we cannot claim back from the NHS.
Q167 Josh Fenton-Glynn: You have highlighted your desire to do more with some of the centres—turn them into neighbourhood health centres and make sure that they are not underused. What would be the best way to enable that? How could we best bring into use some areas that are not being used?
Rob James: I think it is for the commissioners and the GPs themselves to approach us and ask us to act as an arbiter. We could look at the lease structures in place and work through a solution, whether that is restructuring the leases or opening up a discussion regarding how the reimbursement works. It is on a scheme-by-scheme or asset-by-asset basis. I submitted 40 properties to NHS England that we thought were suitable for neighbourhood health in the current roll-out, and we still stand by that submission. We have three that were identified in the first phase of ’27, but we feel that there is significant potential in the current estate.
Q168 Josh Fenton-Glynn: Is it a particular LIFTCo problem, or is it a general issue that public-private partnerships are just not flexible enough as a model?
Rob James: You have a good point. When you split down the ownership model, GPs own circa 60% of the estate, private own 20% and NHSPS and CHP own around 14% or 15%, so there are different ownership models throughout the sector. PFI, through the LIFT model, is a financing lease. Essentially, that lease serves the purpose of paying down a debt over a period of time.
On the third-party development side, it is far more flexible because it is an occupational lease, so there is no debt against it. It is an occupational lease, and the money and rent flows through that process. We provide free assignment to GPs, so GPs can assign to other GPs and NHS bodies, whereas it is a little bit more challenging under the LIFT model.
Q169 Josh Fenton-Glynn: A 2009 article in the Journal of Risk and Governance, which I do not expect you to have read, said: “If there is significant change in a product or service originally specified,” then under the terms of the contract, “the supplier may see this as an opportunity to increase their revenue” and “lock the health service…into inflexible contracts”. That is essentially what happened, isn’t it?
Rob James: In LIFT, possibly. It was what we call now a DBFM contract—design, build, facilities and management. That built the building, rented it back and ran it through hard and soft FM. Our sector is completely different from that. We pass that FM control over to the GPs if they want that, or they might want us to manage that building. We do not impose management costs. It is very transparent, and we have a built-in value-for-money process in place for the district valuer.
Q170 Josh Fenton-Glynn: If we are going to build and create new assets for neighbourhood health, which may be part of it, do you think that there is an impetus for organisations like yours to show you can be flexible with the estate we have and seek to be more flexible in future?
Rob James: Yes, and I think that we are already showing that. My message to Government would be to not stick to one route. There are plenty of routes there, and we have already looked at the voluntary sector providing services and the wider community providing services. We are looking at third-party development and PFI. We should not dictate from the centre how individual ICBs want to deliver their models.
On flexibility, on some of the projects I am working on, for example, we can take NHS capital to support the revenue and reduce the revenue model. We can take section 106 and CIL, and we can plug that into the system. On a financing lease side—on a PFI—that is not as straightforward to do. We are trying to find different ways to deliver with our NHS partners.
Josh Fenton-Glynn: I think I have a meeting coming up with your team on the specifics, but understanding how we got there with the problems is really helpful for looking to the future. Thank you very much for that.
Q171 Joe Robertson: The Health Service Journal reported today that Penny Dash, the boss of NHS England, has suggested there is twice as much floor space for GP practices and associated services as the NHS actually needs, suggesting that there is a 100% oversupply.
Chair: For the benefit of Hansard, the panel is looking quizzical.
Joe Robertson: Do you have any reflections on that? It seems a remarkable statement. It was made yesterday, apparently.
Dr Wood: I think we both have things to say about that.
Dr Hynes: The possibility that the GP space is underutilised is not what our partners and patients are saying. We had 64% of partners in our latest member survey saying that they do not have sufficient space to accommodate new multidisciplinary team staff. We have 500 practice managers, and 74% of them say that they cannot recruit because they have a lack of physical space.
For 12 and a half years, before I started this role, I was a training programme director in west Birmingham. We allocated GP registrars to practices in the west Birmingham area, and we struggled to get placements. Where practices had capacity for three registrars, the room capacity all of a sudden meant that they could only take one. We were struggling to place people and, if people needed extensions, that became even more problematic.
We do not have empty rooms; we did have a “We can’t care from an empty chair” problem, and we needed more workforce, but now those chairs are full. We are having to work out some surgeries saying, “I don’t think we have room for the midwife today,” and we are asking them to go elsewhere. We want our midwives in our surgeries, where pregnant mothers can come and confide, in a safe space where they feel safe, yet because of room space, we have had to say, “I’m sorry but we don’t have room availability. We need to fit in our nurses, doctors, mental health therapists, physiotherapists”—whatever the additional service seeing patients will be. We are quite restricted in that respect, and a lot of the vacancies that we do have available are upstairs next to the server, which is heating up to 37° on a heatwave day. That is where the empty space is—it is not patient-facing space.
Dr Wood: To be honest, I just have to laugh at the idea that there is twice as much space available. In our case, our GIA for Staploe medical centre is 952 square metres; our ICB’s own formula says we should have double that. The reason we do not is because of delays trying to get a new build built. The consequence of that is really significant, and it makes me quite cross, actually, to think there is a message out telling you that it is easy, that we have lots of space, and that the working environment we can offer to our staff is anything approximating acceptable. It’s embarrassing: we have to have staff meetings in our cars because there is no meeting room. We do not have enough consulting rooms to see the patients.
More broadly, on the underutilisation point about non-GP estates, it is all in the wrong place, so we cannot make use of existing community facilities. I had a look on Open Space, which Martin Steele from NHSPS referenced, and the closest one to us is 18 to 36 miles away, depending on where you are in our catchment. That is up to three hours on public transport for a sick person to try to get there to see their clinician. I am just flabbergasted at the idea. I do not know a single general practice in our locality that is not suffering the same problem, so I do not know where the data have come from, and I urge you to challenge the data robustly.
The other key point I want to make about underutilisation is that there is a difference between necessary slack in a building to accommodate for on-the-day fluctuations in patient demand, and temporal underutilisation, which is a consequence of having to have enough space to accommodate your most busy days, as well as other spaces that you require, such as a hot room for somebody who might be infectious. Underutilisation needs to be measured in the right way, including in terms of the opening hours. There are lots of ways to calculate that number to convey quite different messages.
Q172 Joe Robertson: Penny Dash did say it was a “finger in the air” estimate and that she is going to do some work on it.
Dr Wood: It needs work.
Joe Robertson: She seemed also to suggest that because of the good job that GPs are doing with triaging, there is a lot of empty space during the afternoon, suggesting that there is capacity in these buildings during the afternoon because GPs are out in the community. Do you have any comments on the suggestion that you could use these rooms at different times of day?
Dr Wood: We do do that, and we are still half the size we should be. There absolutely is temporal flexibility. In our case, the doctors are triaging in the morning, but it is not the whole session—it might be the first couple of hours of the day. How do you then offer two hours of space to somebody who needs a whole day? Some underutilisation is, unfortunately, unutilisable.
What I am getting at is that genuine opportunity needs to be separated from what the premises need to deliver the service to the variable patient demand. We try to do that as best we can. Occasionally, we might be able to say to a district nurse, “Yes, you can come in on that day because we know we have people on annual leave,” but it is at that level of adjustment, day by day. It is not something that is easily modelled. I think there are assumptions feeding these national aggregate statistics that are resulting in a viewpoint that is totally divorced from the reality of delivering the service on the ground.
Chair: Thank you; that is very clear.
Q173 Danny Beales: Are there any incentives for you to offer up free rooms, or spaces that could be multifunctional? The data is quite high level, but I recently visited a GP centre on a Friday and it was quite empty. I think the view was, “This is generally what happens early in the day on Friday. It gets very busy later on.” Would there be ways of freeing up some of those spaces for a frailty clinic or another part of the NHS system, such as the community trust, to use?
Dr Wood: I think there would be in a larger building, where you have accounted for the slack that you need to flex to your own demand. Do not forget that GPs have hard contractual obligations to triage every single contact that comes in the door, and that might mean bringing people down. We have multi-user digital consultation space, where there are three clinicians in that room and they share the second room. It might sometimes look empty because they happen to all be on the phone, but you have still used only two rooms for three clinicians.
There is a conceptualisation of how we use the space that I do not think is filtering through. Once you have understood what you need for the GP service, of course there is flex. We used to accommodate podiatry, smoking cessation and various other community services, but we just cannot do that any more, apart from in a very ad hoc way. In relation to the question, “Can we do it now?”—not really, and it is very ad hoc. Could we do it in future? Absolutely, but understanding what space is the minimum required to maintain a good GP service and then how the other services flex around that is really important.
Q174 Danny Beales: What tools do you use as an organisation to understand your space utilisation?
Dr Wood: It is a really interesting question. There is a challenge between the clinical system, which is a patient appointment booking system that the clinicians spend their life in, and how you would make the space available in a room booking way. One of the challenges is a lack of software that integrates with the way the clinical systems work, and reconfiguring that to be deployed as a room booking system—
Q175 Danny Beales: So it would be helpful to have the tools that would tell you, as a manager of your estate, “You have this amount of occupation and this amount of people occupying the rooms.” GPs typing up notes might not be the best use of the estate.
Dr Wood: We do all of that, but we do it manually, because there is not one single system where you can look at the availability, and it is not reasonable to expect a clinician who is in the middle of a clinic to start looking into a room booking system separately. We believe that it needs to be integrated with the EMR, but it is possible to do.
Q176 Danny Beales: Are there ways of using AI and video technology, rather than more manual ways, to understand the utilisation of rooms?
Rob James: It is an interesting fact. We have exposure in Ireland, and the HSE in Ireland are putting sensors in all their large units over there to track utilisation and inform what the future roll-out will look like. They have paused the current roll-out, they are installing these monitors and they will understand utilisation, and then their next roll-out will be informed from that data. They will have real-terms data on frequency and use of rooms going forward.
Q177 Danny Beales: But do you not generally have any software like that? It sounds like it is a manual process.
Dr Wood: We have been looking into it for our new building. Twenty-two years ago, when we started trying to get this building out of the ground, the vision was always about integrating other community services. At this point, what we would have proposed in the business case from 2021 was to have exactly that, so we have been spec-ing out what that software might look like. As I say, the challenge is the interface with the clinical system so that it is as easy as possible for the clinicians running the service to know where they are meant to be and where they might be able to book a patient in, and externally, for other service providers to able to see where there is space and opportunity.
Q178 Danny Beales: You talked about the need for spaces being different. Dr Hynes, you mentioned the age of the estate predating the NHS. Are there clear, up-to-date design guides for what different sorts of neighbourhood health services should look like in the 21st century? You mentioned floor space or ICB footprint, but is there a clear and consistent guideline for what the design—the mix of spaces—should look like?
Dr Wood: For the neighbourhood health centres or general practice?
Danny Beales: For the primary care estate broadly and for neighbourhood health.
Dr Wood: There are the HBN regulations, which stipulate how the rooms should be specified to a minimum area—
Q179 Danny Beales: Beyond just clinical safety guidelines—more like design guidelines. There is a hospital 2.0 standard being developed for the new hospital programme, but is there a clear design standard for primary care?
Rob James: There is HBN 11-01, which is the guidance for design of primary care facilities. It usually relates to the GMS side rather than the wider community.
Q180 Danny Beales: Would it tell you, “You need this amount of flexible space for admin staff”?
Rob James: Yes, it does. There is a calculator that sits behind that, which will tell you exactly what you should have.
Q181 Danny Beales: Is that a floorspace guide or an actual design guide?
Rob James: It is a design guide in so far as what adjacencies you need—what needs to go next to what facility—what support functions you require, the size of rooms or the amount of circulation. It gives you a guide plus a calculator, so that essentially, as a designer, when you present that to the NHS, it is hard for it to roll back and say it should be smaller, on the basis that you have followed the patient demographic—
Q182 Danny Beales: Do you think that guide is in line with the modern requirements for neighbourhood health and primary care generally?
Rob James: It is quite dated now. I think it is over 10 years old. It would require updating for the neighbourhood plan, because there will be an opportunity to drive efficiencies with shared space in the neighbourhood plan with the multiple users. If the neighbourhood health centre programme were a driver for that change, that would be a good thing.
Q183 Danny Beales: That is helpful; thank you. On sources of financing, Dr Wood, you talked about trying to get a new build proposal off the ground. What was or is your experience of accessing funding streams? What funding model or streams did you look at for that proposal?
Dr Wood: We looked at all the options. We had to do a full options appraisal in our business case. Fundamentally, the partners’ preference is for a GP-led scheme, but that proved unaffordable, largely because of two things: one is the district valuation methodology; and the other is the lack of access to Government-backed borrowing for GP partnerships. Thirdly, there is a lack of access to other capital. As a result, we looked at third-party developers. Assura-PHP is our nominated option, but is also non-viable at the moment, because of the district valuation methodology—
Chair: We are coming on to that.
Dr Wood: That is two sides of the same coin, in a way: GP partnerships cannot access Government-backed borrowing, which means their costs go higher in terms of repaying the debt—
Danny Beales: And private borrowing is not financially viable.
Dr Wood: No, because the interest rate is so high. Then we looked at third-party developers, but they have shareholders to think about as well, so at the moment, we are stuck because of the DV. By way of example, our valuation was last done in 2019, at £220 a square metre. That was still viable in 2021, when our business case was approved, but fast-forward to 2024 when we were finally getting the planning sorted—that is another story, but not relevant here—so five years later, the DV came back with only a 4.5% increase against a backdrop of a 40% to 50% increase in construction costs.
I challenged that, but was told nothing doing really, and that is because of what portfolio of estate that the DV looks at in its assessment. I also challenged on the fact that our building was 30% smaller than the ICB’s formula, because we were innovative in our use of space. The business case was commended by NHS England as an exemplar for the region for innovative use of space, but the 30% saving was not reflected in the valuation. Similarly, we put forward about £280,000 of system savings by service transformation and improved care, which would have offset the increase in rent. That was not accommodated by the ICB as a strategic argument at the time, because it was treating the district valuation as a binding thing, rather than as an advisory thing.
The mechanisms for ICBs to make that strategic case and be comforted that the strategic case is strong enough for them to exercise their flexibility, is not there. A national mandate is needed on that point. The DV methodology is a huge problem, and it will take a long time to resolve—an interim solution is needed.
Q184 Danny Beales: We will come to that in more detail. What about any other grants, section 106 funding or any national capital grants? Do you or anyone else have any experience of accessing those pots?
Rob James: Shall I dive in?
Dr Wood: Go for it.
Rob James: We are seeing a lot more flexibility coming through, but unfortunately it is very regional. We are seeing innovation in some ICBs, which are accessing section 106 URF money from the centre, for example, and using it to plug into a particular project, in order that that rental level can stay at a level where the DV is happy. The fact that capital is coming in to support that is a different story. We see significant success in Bristol, Gloucestershire, parts of London and in Dorset, where the ICBs think differently and innovatively, whereas unfortunately in other ICBs we are hitting that block of, “We must listen to the DV and we cannot move past that.” So we are starting to see the emergence of progress that things can be done differently.
Q185 Danny Beales: Do you have any experience of accessing section 106 and CIL specifically? Do you have any reflections on how that can be improved? We have heard evidence before about inflexibility and large amounts unspent, including specific health pots at local authority level.
Rob James: I think it is due to the cycles the NHS works in and the length of time it takes to approve a scheme. Invariably a housing developer will time-limit that opportunity to be able to either have a free site or to get the funding, and the NHS missed that window and therefore it goes unspent.
Dr Wood: The proposal we have on the table does benefit from some section 106 in the form of a gift of land, but we also have a very supportive district council who are open to a CIL application as and when we bring it forward. The challenge we have is that there is an assumption at the moment that CIL should abate the rent that is reimbursed. You have an undervalued DV assessment, and any capital that you secure is then further abated on an assumption that it is double dipping in some way. But CIL is private developer money paid directly to a district council to spend at their discretion on infrastructure that they see as being of benefit to the population—to the community. There is a disconnect there: the PCDs do not talk about CIL; they talk about section 106 explicitly being abated. It has chosen to be silent on CIL, yet there is an assumption that it should be fully abated in the same way, and that is a fundamental blocker for us.
As a commercial research delivery centre, there is capital infrastructure available for us through NIHR, but at the moment it is not for new builds. It is for equipment, portacabins and mobile research vans. But in the VPAG at the moment, although there is nothing restricting this in the agreement as far as I can tell, there is no facility for capital for a proportional contribution to the GIA—the gross internal area—for exclusive use for research. We are not asking for reimbursement of that area because it is funded separately, but the capital to build the bricks and mortar would enable us to meet the UK life strategy target and then double again. But we cannot at the moment because we cannot get that capital.
There is an ask about the pace of approvals, meaning that money is not lost. There is an ask about the rules around CIL and CIL abatement and how that is used—or not—and how that interplays with district councils. For our scheme and for other CRDCs around the country, there is an ask to the Department of Health and NIHR to look at a capital call specifically for commercial research delivery centres that meet that wider life sciences strategy.
Dr Hynes: One of the things we noticed in our GP voice survey of 2,000 GPs was that only 27% of partners have accessed funding for infrastructure in the time that they are reflecting on when they are feeding back to us. The reasons for that are not explored in the voice survey, but obviously there are apprehensions about long contracts, service costs, maintenance, all these kinds of things, and what the detail in that contract will be. If that was tied into house planning with 5,000 new homes in a particular area overloading a service, is there a security for a new GP practice? An idea might be that you pump prime that practice to allow the growth of the list that would not make it a viable business until it gets to the point where it is sustainable. That way you can provide for that community of however many people are occupying those new houses.
Q186 Chair: And that, of course, is one of the big reasons why people oppose development: because they know it does not come until much later.
Can I come back to district valuers? We have an issue in Oxford with a practice that is absolutely not fit for purpose across several floors in a Victorian building that desperately needs upgrading. There is a new site next door that the council owns, where they are very happy to work with everyone, including the ICB. But we are, as you said, Dr Wood, stuck, so when you were having what I will gently describe as a rant, it resonated. I could see there were people in our audience here nodding away as well, so this is a common problem.
Can I focus on some of the solutions to this problem? First, what is your understanding of what the district valuers say and who decides how and what they do? Tell us who we need to go after to help them to fix their methodology. Secondly, Dr Wood, you said that the ICBs should be taking this as an advisory, rather than mandatory, figure. Can you delve into that more? If anyone has any other suggestions about what we might do to fix this, I’m all ears.
Dr Wood: Obviously, there is a long-term need to review the methodology. The premises costs directions have only just been updated, and that took 11 years, so it will take more time.
Chair: Who did that?
Dr Wood: I do not know. The district valuation has never published its methodology as far as I am aware. I have not seen it. We do not get appraisals for the new build schemes so there is no transparency to debate how they have arrived at their valuation—at least, that has been our experience. I would ask the Department of Health and Social Care to direct the district valuer to publish its methodology and appraisals, which can be done right away, and then create a dispute resolution mechanism where there is a conversation between the ICB, the DV, the practice, the developer or the stakeholders involved to try to reach an appropriate value that reflects the true market cost.
I said that it was advisory but taken as a directive. I cannot reference that, but our experience has been that it is taken as definite. ICBs have executive discretionary powers to grant up to 100% under section 96 to offset any shortfall, and there are other ways they can exercise discretion. I think you have direct experience of that.
Rob James: We have been having this interesting conversation with the DV for some time. Under the premises costs directions, the DV is afforded the ability to look at an appraisal-led assessment of rent rather than a market rent. The difference between those is that the market rent looks backwards. It looks at rents that have been set in the four previous years and uses them to inform the process of what the rent should be. Under the premises costs directions and the GN60 guidance from the Royal Institution of Chartered Surveyors, they can have an appraisal rent, which means that they look at the real-terms delivery costs and reflect that in the rent. It suits the purpose of NHS England and the DV not to go down that route because they are keeping the rents at a lower level.
Q187 Chair: Is this a bargaining tool for the NHS?
Rob James: To a degree but, as I alluded to earlier, the localised ICBs are getting frustrated with this and the lack of progress. ICBs are working outside the DV framework now. They are saying, “We respect your view, but we are moving forward with this because we need to put the patient first and therefore we are moving projects forward.”
Interestingly, we had a solution from the south-west that we brought into Oxfordshire and said, “This is a solution that works.” It was rejected by the DV and the ICB even though we have schemes that are being delivered using that solution.
Q188 Chair: What reasons did they give?
Rob James: That it did not meet the premises costs directions, even though it did.
Chair: It did in the south-west, but in Oxfordshire it did not?
Rob James: In the south-west it did. It has been approved. In Oxfordshire it did not.
Q189 Chair: Is that because of land prices, or do you just not know because of the lack of transparency?
Rob James: Exactly. We do not know. All we had is a letter saying, “Unfortunately, it doesn’t meet the requirements.” We had to withdraw on that basis.
Q190 Chair: Which site was this?
Rob James: Didcot.
Chair: I am well aware of that site.
Rob James: It is possibly being delivered by another partner, which is great.
Chair: It is not. It is still fallow.
Rob James: It frustrates us that we are making really good progress with innovation through different ways of funding and different access to capital that will offset the revenue requirements for an ICB, and then we put that model forward and they said, “Not for us.” That is frustrating because we feel that we can scale our offering. It is good value for money. It still offers DV comfort that the passing rent is at a level, but we are supporting it through use of capital.
Q191 Joe Robertson: We have already heard that the current premises reimbursement rules actively discourage GP practices from sharing space with wider neighbourhood services. Before I move on, do you want to make any further comments on that, and particularly on how it should be changed?
Rob James: The only thing I would say that in the neighbourhood health centre programme there is an opportunity to drive efficiency through the use of shared space.
Q192 Joe Robertson: You have moved straight on to my next question, which is about exactly that. What opportunities do the neighbourhood provider contracts present to improve how we fund the GP estate and the wider neighbourhood model?
Rob James: It is going to be interesting to see how it is structured. As a funder of primary care premises, we require security of tenure in order to access that lower cost of capital. If it is fragmented, like the contracts are fragmented, that will be difficult to work out. The idea is that someone will take a head lease and then sub-lease those elements underneath. That is good, because it could drive efficiency and better utilisation, but it will require an active management process in the building to drive that. We need to be very careful that the innovators in there are the private sector—the GPs. The GPs need the opportunity to adapt and expand, and they cannot be hamstrung by the estate. Whatever we design as that model—the neighbourhood health centre—needs to be flexible and adaptable, and needs to be able to increase in size in the future.
Dr Hynes: One of the things we were looking at was the level of evidence and whether we can base it on the existing knowledge. The ICBs have been asked to produce primary care estates information. So far, some ICBs have published it, but we need all ICBs to publish it so that we have this consolidated data and can act on the evidence.
We also have the national neighbourhood health implementation programme—the 43 wave 1 sites. What feedback are we getting there from things like capital and revenue, the digital experience, the patient experience and safety data? That is not forgetting what is happening in deprived and rural communities, where there is the greatest level of need. Obviously, we are making sure the services are close to where patients can get to, as in the examples that Louisa set out.
Josh Fenton-Glynn: I would like to observe that Rob did very well in answering about my constituency and Layla’s constituency. I hope he buys whoever briefed him a drink afterwards.
Chair: Didcot is technically not in mine, but I am aware of the issue.
Q193 Josh Fenton-Glynn: I am going to talk about NHS Property Services. The BMA has reported that 65% of NHS Property Services tenants reported inaccurate charging. The Royal College of General Practitioners has said that the unsustainable costs and the unpredictable rent increases and services charges have forced people to reduce capacity or scale back services. Dr Hynes, why do so many GP practices report issues with NHS Property Services, such as unsustainable rents and unpredictable charges?
Dr Hynes: Because that is their lived reality. When you own your own building, you have a vested interest in it, and it provides a commitment towards the continuity. As a buildings owner, I make a loss on the building in the initial years because the notional rent falls short of the repayments. I accept that, because it helps to facilitate the continuity of care that patients need. If I can get to 15 years in the practice, which I did five years ago, we are delivering a 30% reduction in hospital admissions, a 28% reduction in out-of-hours attendances and a 25% reduction in mortality through 15 years of continuity with the same GP.
The feedback from members about NHS Property Services has been that it is unpredictable and unsustainable. If you have that kind of climate, how do you convince another partner to say, “You can buy into this, but we can’t promise when the rent will be increased and what the services and maintenance costs will be”? It was all to do with the feedback that we were getting from members about that experience. It did not quite work in the way that was intended.
Q194 Josh Fenton-Glynn: How significant will the transfer of NHSPS properties to trusts be, in terms of neighbourhood health?
Dr Hynes: Well, there are conditions that go with it, and obviously it is about making sure the same condition are passed on to trusts. Again, there is the potential for rent increases and instability, and the perception that that may present to a partner looking to come into that building and that business.
One thing that you need to legislate for is getting to net zero: 16% of our carbon emissions come from our energy use, yet we do not have the same access as hospitals and schools to things such as insulation, heat pumps and cooling systems—my goodness, I could have done with that on Friday on call. It is that kind of thing: are there opportunities to expand and do that in those kind of environments? You have a little bit more nimbleness and flexibility when the GPs have that ownership and commitment to the practice from buying in.
Q195 Josh Fenton-Glynn: There were staggering bits in the briefing for this session about GPs taking out personal loans and so forth. None of this is how you would design the system if you had a blank sheet of paper. If you were going to design a system for the NHS estate, how would you do it?
Dr Hynes: I would incentivise remaining in a practice and providing continuity of care. That long-term perspective means it needs to be aligned with workforce, estates planning and house building to make sure developers have that. It is built into the contractual framework—a bit of BMA territory—which should facilitate easy district valuation and the delivery of services.
Q196 Josh Fenton-Glynn: Would you incentivise individual GPs, or GP practices?
Dr Hynes: The services, not the individual GPs. As a group of clinicians, you come together to provide the service to the community that you want to build a legacy with. It becomes very easy when you have been in practice for 15 or 20 years, because you can see the patient as they come in from the waiting room and you can work out, “They’re walking differently; what’s going on there? There’s something not quite right.” Consultations are very much on fast-forward when you facilitate that level of continuity and incentivise somebody saying, “I’m going to stick around; this is somewhere I can grow my career.”
Chair: Thank you so much. That brings us to the end of the first panel. I really appreciate your time.
Witnesses: Bill Shields, Sam Pluckrose-Oliver and Joe Garrod.
Q197 Chair: Thank you very much to our second panel for being with us. Could you please introduce yourselves, saying who you are and what you do?
Joe Garrod: I am Joe Garrod. I am the strategic director of place at the London borough of Waltham Forest, so I run housing services, regeneration planning and property. We have delivered or are delivering a number of new health centres for the NHS.
Bill Shields: My name is Bill Shields. I am the chief financial officer for the Derby and Derbyshire, Lincolnshire, and Nottingham and Nottinghamshire ICB cluster. We came together in the latter part of last year. We cover a population of about 3.3 million people, from the high peaks in Derbyshire all the way across to the North sea. We are now experiencing very diverse communities, and we are bringing organisations together to deal with a lot of legacy estate issues we have to work through to make sure we deliver on the neighbourhood health plan.
Sam Pluckrose-Oliver: I am Sam Pluckrose-Oliver, policy and public affairs manager at Locality. We are the national network for local community organisations, so we support more than 2,000 local VCSE organisations across the country. For the last five years we have been part of DHSC and NHS England’s national VCSE Health and Wellbeing Alliance, working with both bodies at a national policy level to inform a more community-led approach to health, particularly in the context of neighbourhood health.
Q198 Chair: Throughout this inquiry we have heard about fragmentation and lack of integration between NHS local authorities and VCSEs, so we have a good panel to help me to understand some of the tensions. We have also heard that one of the changes that could be made is an alignment of funding timelines. We are trying to get to the bottom of how we make this better. My experience in Oxfordshire is that we have a locality where we have everyone on board. We have the city council, the voluntary sector, the practice itself and the ICB all trying to achieve the same thing, yet they find themselves butting up against each other and not being able to make a building work. What do we need to do to unlock that?
Joe Garrod: At Waltham Forest, we work with a range of partners, ranging from FTSE 100 developers through to community interest companies such as Soho Theatre, with which we opened a new theatre. We have opened a small campus with the University of Portsmouth—
Chair: Can we focus on the NHS?
Joe Garrod: This is contextual. It was interesting hearing about all the governance and structural challenges. The biggest block for me is a cultural one. With all the parties I have mentioned, I am able, as an organisation, to transact, develop projects and deliver in good faith. You may have tough commercial negotiations, but they will be able to specify what they want, how they will go about realising the asset and how they will fund it.
Sadly, my experience of working with the NHS is that you can literally agree to build a facility—for example, we did a housing regeneration scheme consisting of 88 homes, with a new health centre for two GPs on the ground floor. It completed at the end of 2022. Some homes were sold for private sale and some for affordable housing. Residents moved in, but the health centre has sat vacant. It needs fitting out, as shell and core, because of multiple delays in respect of which NHS body we were going to contract the lease with. First, it was going to be the GPs, but then the ICB said they were not happy with that and it would have to be a body in a neighbouring borough—in Newham—because they could not contract directly with us. Then they said they were not happy with that body, so we would have to contract with NHS Property Services. The ICB also could not find a mechanism to fund the fit-out, so we said, “We will lend you the money”—borrow it from the Public Works Loan Board—“and lend it on to you at cost.”
There was then a huge, protracted negotiation with the district valuer. I will not go into detail on that, because the doctor who spoke earlier had exactly the same experience—I think you saw me nodding. We had that long thing. The key blocker was that we needed to recover our build costs, fit-out costs and the cost of the debt we were taking out. The district valuer was saying, “It’s not worth that level of rent,” but we could not contract at below that.
The GPs’ existing health centre had been sold to a small local developer, and eventually the MD of that developer phoned me up and said, “We’ve been sitting on our project for over a year because we do not want to evict the GP surgeries.” They do a lot of work in Waltham Forest and they value their relationship with the community, but they had incurred costs of £1 million in developing the scheme and the debt they had taken out to do it. I had to say to that developer, “No, it’s not reasonable that you continue in it, because you could be here working with the ICB and the NHS for five years. We don’t get the affordable housing. You’re incurring more financing costs for a vacant site.” We had the ridiculous situation in which the ICB had to move the two GP practices into space in other local GP practices, so all the residents are now inconvenienced, with longer journeys from their community.
This is not how we normally work in Waltham Forest, but to move the project forward, every time it has taken a letter from the leader of the council to the chair of the ICB with a statement saying, “We will make this public unless you move further on.” We were getting into a situation where the council was being blamed for the situation. We will always say so if we have a role to play, but it was NHS delays and the byzantine system you go through. You never really get a sense that there is somebody there championing it, other than the GPs.
Q199 Chair: One of my questions on that was about what needs to change. You are saying it is the culture; can you be more specific? What exactly is it in the culture?
Joe Garrod: In my experience of local authorities, when you deliver a project, you look at the outcome you want to achieve for residents, and then you figure out how you do it. Working with the NHS, I often find that they will think, “There is this rule with the district valuer,” or, “There is this problem here,” or, “We cannot do this for this reason.” There is not a problem-solving attitude about how you move forward.
There is also a big issue around accountability. Our local councillors and we, as senior officers, are known in the community and visible. We will meet with residents—councillors, even more so, are actually living in the community. You do not get that sense in the NHS. Every time you get a movement, there is another restructure; they move senior officers around again. We need all the technical work to sort out the guidance and the governance, but also a new culture in the programme that says, “We want to deliver change for our patients”—and then that accountability.
This is not just at a local level. In the new hospitals programme, our local hospital, Whipps Cross, was meant to be rebuilt. Millions have been spent on that scheme, including on a new car park, and then the hospital is just pushed back 10 years hence. In other parts of the public sector—I include other bits of central Government; I used to run the One Public Estate programme in London, working with the Cabinet Office—you do not really have that. When you want to do a project, there is a commitment to see it through, and you do not always get that sense with the NHS.
Bill Shields: I agree with quite a bit of that, and I will respond by thinking about the NHS more broadly, rather than just the area that I work in currently. It is fair to say that in the NHS in the past we have been obsessed with rules, regulations and funding routes, particularly annual funding, which is something that militates against the flexibility that we require going forward. If you think about where ICBs are positioned or will be positioned going forward, they are strategic commissioners, so they need to take an overview of strategic capital: strategically, what will the capital that is available in that area deliver? Rather than looking at piecemeal developments—backlog maintenance in some suboptimal buildings—what could happen if that capital was pooled together and some of those developments could take place?
We are hide-bound, not just in terms of regulations, but in terms of some technical aspects. The previous speaker talked about health technical memorandums and some of those things. Delivering most of the care that we are talking about does not require a clinical space. If you look at this from a One Public Estate perspective, there is a lot of space—leisure centres, libraries and other facilities—where healthcare could be delivered. There is a plethora of estate that is being underutilised.
I agree with some of the comments made by Penny Dash about the silos we have had, with CDCs being separate from community hospital development and from the new hospital programme. These things need to be brought together, so that we can look in the round at what is required for the populations and communities that we serve.
Q200 Chair: When we were out in Cornwall, we heard some of this, too. The regulations are gold standard, but not all care needs to be at that level. Would you agree with that?
Bill Shields: I would agree with that. Unfortunately, in the NHS we sometimes conflate safety with quality. We need to be clear about the fact that this is a publicly funded service. It is cash constrained, and we need to do the best that we can with the money that we have. That does not mean that we always provide a gold standard. It means that we have to provide something that is both safe and is the best that we can do with the available money. It behoves us to make sure that we establish value for money.
To return to the earlier discussion about the issues around the DV’s role, District Valuer Services is part of HMRC. One of the issues there is whether this something that is about ensuring value for money for the public, or whether it is something that relates to the tax take. There needs to be some flexibility there, as well as much more cross-governmental working between DHSC, HMRC and other Government Departments to get the best outcome.
Sam Pluckrose-Oliver: From a local VCSE perspective, the culture change point is absolutely key. The position most often adopted, or that is forced to be adopted, by the sector is of the supplicant partner within the relationship between the NHS and the health system. We very much talk about the idea of the VCSE sector as an equal partner. We are more strategically important and impactful in health, neighbourhood health, prevention and the wider determinants of health because the organisations in those community-led spaces have the trust, relationship and connection to communities to make the biggest impact on those things.
When it comes to spaces, that absolutely has to be first in mind. To step back, it comes down to strategic national policy support and enabling ICBs, local health partners and their VCSE sectors to do this. I think about the much deserved praise that somewhere like the Bromley-by-Bow centre got and gets. It was held up as the example of a neighbourhood health centre in the run-up to the last election. There is now a disconnect with the approach taken by the Government and NHS England toward neighbourhood health centres. It has been very much led by the NHS and local authorities—particularly by the NHS.
On the role of the community sector, there are now more than 9,000 community spaces across the country that are nominated as assets of community value. There are, from the last assessment in 2019, about 6,300 assets under community ownership. They are key local community assets that have, depending on their form—buildings, spaces, green spaces—a huge role to play in the delivery of neighbourhood health as trusted and connected spaces for the local community. But because of the junior partner role, the lack of joined-up capital funding for community ownership and a serious problem with availability of revenue funding—
Chair: We will come back to that.
Sam Pluckrose-Oliver: It all leads to, in the example of a VCSE—even more so than I know is already the case in the NHS locally and in local authorities—having to scramble around to get together resources and make their voices heard in that relationship.
Q201 Chair: Joe, we heard in the first panel about the issues with section 106 and CIL funding. From your experience, are there any changes you would urge the Government to make in how that funding can be used?
Joe Garrod: We have a number of health centres being delivered on big, private-led schemes on private land. You will find that, commercially, most developers want to deliver a health centre, certainly in a London context, because having local GP surgeries and community health facilities drives residential values, and it is a key selling point for the private units.
There is an issue with time limiting, but it is usually not because of the developer; it is the ability of the NHS to move quick enough and say who will occupy the space, how the revenue will be funded, who will fund the fit-out and who is going to do it. Certainly, in Waltham Forest’s experience, it is not an issue of private sector developers trying to renege on their responsibilities. It is more a concern—we put a huge amount of work into it—of chivvying the local health system along to take up that space.
My view is that if we did not do that, it would not happen. We would be left with vacant spaces in the developments, the section 106 obligations would time out and the developer would be able to let them to a supermarket or other commercial use. The space needs to be used and, if the NHS cannot move in a reasonable timescale to occupy it, that is ultimately what needs to happen.
Q202 Chair: Does that make local authorities less inclined to work with the NHS?
Joe Garrod: They are probably the most challenging partner to work with. We will always work with them because of the critical need for new GP surgeries in London. It is something that elected members of all parties ask about. It is probably the first bit of social infrastructure when we are delivering new housing. After asking how much affordable housing is delivered, the next question is, “Will there be a new health centre or GP surgery?” We will always champion that and commit the resources to try and make it happen. But it often feels like an uphill battle working with the NHS.
Bill Shields: Can I add two things to that? One is that I think for that to be successful, the health infrastructure requirements need to be identified early and need to be embedded within local planning and development discussions. I do not think that is something that always happens. There also needs to be some realism from the health perspective, which is that the developer contributions on their own will rarely be sufficient to fund that completely. There will still be a contribution. I do not think that is always the case. Sometimes that is missed and it is assumed that that will be fully funded.
Q203 Danny Beales: On that point, Bill, we have had evidence before that the NHS should be involved in the planning system or built into the planning system. What does that look like and what does that lead to? It sounds like in your experience, Joe, and certainly in my experience when I was in charge of regeneration planning in Camden for seven years, that it was not necessarily a lack of involvement that was the problem. It was a lack of the ability to make decisions that was the problem for the NHS. Either Bill or Joe, do you agree that there should be more involvement in the planning system for the NHS? If so, what should that look like?
Joe Garrod: Where the NHS is strong is on identifying the strategic need and coming up with the strategic plan and strategy. Where it is more deficient is in the delivery of that strategy. We have an infrastructure delivery statement as part of the local plan, which is updated annually, that matches section 106 and CIL contributions to need. We work very closely with health partners and health planners to inform that.
Where we come more unstuck is around taking that aspiration into delivery. It is not actually delivering the new floor space; it is about getting NHS partners to fund the fit-out and deal with the issue that Bill identified around how it will never cover the full cost of the asset from a single development, and then also occupying it. It is not the front-end involvement; it is more about the downstream delivery involvement and that focus on, “We need to make this happen.”
Q204 Danny Beales: You don’t think that involvement in the planning application is the solution?
Joe Garrod: I think the NHS, certainly in Waltham Forest, is sufficiently involved in that part of the process. It is in what needs to be done once planning permission has been granted and the facility is being built to ensure that the GP or other uses actually occupy the space.
Q205 Danny Beales: Obviously, there is a similar analogy to school provision, and there are different ways of assessing school place planning. Generally, the LEA is the local authority, and there is the planning authority too. In your experience, does that process work better in terms of identifying school places need and the formulas for assessing what payments may or may not be? Do you have any views about the differences or similarities in the challenge of meeting school provision and health provision through the planning process?
Joe Garrod: Way back when, pre mass academisation, that was a much easier process when most schools were maintained, and the local authority was the admission authority. With school places, with a lot of academies, which are their own admissions authorities, it has almost become more like working with GPs, which are a range of independent organisations where the ICB as director does not have an overall co-ordination relationship with them.
We take local authorities because the success of the school estate is so linked to their being the right number of pupils and having a level of surplus capacity that means that schools are not underfunded. We are very focused on that. I am not sure—you would have to ask colleagues from ICBs whether they have that same level of focus on GP facilities.
Bill Shields: Answering this question about the way things have been and the way things are is going to be very different from doing so about the way things will be. ICBs will be much bigger. They are much bigger. Their link with local government is increasingly going to be with mayoral authorities rather than with the planning authorities. We need to think about how that will be delivered going forward. I think that is through neighbourhoods.
Danny Beales: That would be harder then, from what I am understanding.
Bill Shields: From an ICB perspective, it would be harder for them directly to engage.
Q206 Danny Beales: In my area, two ICBs have merged, so 4 million people across north and central London are now in my ICB. In terms of the grip of local GP provision, and development opportunities coming from one of the 11 local authorities, has that become more challenging in the new super ICB structure?
Bill Shields: That is why it is incumbent on ICBs to make sure that they are really clear about what neighbourhood looks like, what neighbourhoods do and how neighbourhoods engage with the planning authority going forward. The ICB can set the strategy, but it will not be feasible for an ICB that covers a 3.3 million or 4 million population to engage directly in each development going forward.
Q207 Danny Beales: That is a big risk, as part of the changes. As you say, the NHS Bill going through Parliament at the moment removes local authority representation on ICBs, and there is a move to a mayoral system. The mayor will usually have some sort of strategic planning approach across the city, but it is a very light touch, call-in process—it will certainly not be about managing GP provision. Is that a retrograde step? Should local authorities still have a seat at the table? Would that help with planning this sort of infrastructure?
Bill Shields: In the specific example of the ICB cluster that I work for, there are three local authority representatives. They cannot represent every single local authority, and that does not represent the five local authorities that we currently deal with. Arguably, that will be very different with two mayoral representatives, as we will at least have representation from two mayors, covering the strategic requirements of each of those areas—the East Midlands and potentially Greater Lincolnshire. They might, and probably will, have very different views on how that should be taken forward, but that is the right level for us to engage with, if we are covering a population of 3.3 million people.
Q208 Danny Beales: It sounds like one of the challenges is the joint working between the planning authority, the local authority and the ICB. It does not sound like that will necessarily be easier under the new model—although there might be other benefits of mayoral representation. Are there things we need to consider in this new approach to improve what is already, by the sounds of it, a bad situation in the joint working between local authorities and ICBs on planning?
Bill Shields: I would not say it is a bad situation between health and local government in any of those areas, whether that is around planning or social care, but there are tensions. We have to be realistic: there will be tensions in two parts of the public sector that are funded in very different ways. Sometimes, those tensions come to the fore in some of the conversations, and we expect to have adult conversations about how we resolve them.
Joe Garrod: That is a potential issue with the new model, and it will need to be managed through. Strategic engagement is really good. I agree with Bill’s point: in most ICB areas, one or two local authorities represent local government. With the new model, if the strategic relationship is via mayors, what local delivery teams do to work with individual local authorities to deliver the part of the plan that relates to that authority will be key. That does not necessarily need local authorities to be sitting on every body, but it is about the good day-to-day relationships, so that health need is matched with housing growth and demographic change, and those facilities are well-planned, funded and executed.
Q209 Danny Beales: What stops that happening now? If representation in the decision-making body for the health system does not matter and it is possible to do it through local working, why are we not working well together in that informal way now?
Joe Garrod: In my experience, it is about the ability to transact and conclude property deals. Need is identified reasonably well, planned in and often delivered on, but when assets are delivered, it is about getting the lease signed, the fit-out funded and the new services moved in. The challenge is at that stage, in my experience, and less so at the strategic planning stage. That was my experience when I ran One Public Estate in London. There were all sorts of area-based and strategic plans, but it was about actually taking that plan into reality and delivering it.
Q210 Danny Beales: That’s helpful. Finally, you talked about the local authority having the ability to move in a different way. The local authority can borrow; there is the general fund and potentially the housing revenue account, although that is more constrained. The NHS faces quite different abilities to borrow and has quite rigid and centrally imposed capital expenditure limits. How much of the challenge for the NHS is around the fact that you as a local authority can borrow against lots of different revenue streams, so you have quite a lot of flexibility that the health system and ICBs do not?
Joe Garrod: That is a huge challenge. The very prescriptive, governance-heavy way in which capital is rationed into the system has a cultural impact as well. If you are working with a range of funding streams—section 106, CIL, grant, the prudential borrowing that local authorities do, and commercial income—your approach to delivery is to say, “How do we blend that funding to deliver the outcome?” If you are used to working in a highly governance-heavy, top-down model, you do not use that. It does not facilitate that problem-solving mindset.
The role of the district valuer is a subset of that. I am a chartered surveyor. In my job I use valuations all of the time. The 1972 Local Government Act requires us to show best value in property transactions, but we do not have one source of the absolute truth. We take a range of advice, and then we need to assure members, based on the range of advice, that this is what we recommend as officers for these reasons. Having the district valuer as the single source of truth stops that. So it is about the funding flexibility and how you apply market knowledge and values to make a scheme viable and stack up.
Q211 Danny Beales: Do you have any thoughts about additional borrowing freedoms for ICBs or the new integrated care organisations? Would a certain part of the system having more borrowing flexibility help in this situation?
Bill Shields: I have been in the NHS almost four decades. As long as I have been in the NHS, we have always talked about capital slippage. It is a feature in NHS capital programming. We are not good at spending the money that we have. I think there are a couple of reasons for that. We have constant tension between governance and flexibility. We could delegate much more. Relatively small investments still require regional and national approval. That then means we have a very elongated approval process. That speaks to the point that I made earlier about developments not happening and the opportunity being lost. There needs to be much more agility and flexibility there, and much more trust as a consequence of some of these developments taking place. There will always be an issue in terms of governance from a public sector perspective and public expenditure. But I do think there could be more delegation than there currently is.
Q212 Danny Beales: Where do you think the additional delegation should sit? At ICB level? Integrated care organisations? Community or foundation trusts?
Bill Shields: I think most of the above. At a strategic level it is absolutely right for the ICB to determine what the priorities are for that area because they are the strategic commissioners, and the capital distribution should relate to what they wish to commission strategically. We have already got a greater level of delegation to NHS trusts with the change in the capital regime this year. There isn’t system capital in the way that there was before. The problem is that the oversight that used to exist, even at a level that is below the current size of ICBs, has gone. The temptation for NHS trusts in particular would be to deal with backlog and maintenance issues and not think bigger in terms of what they could do with that capital if they were to pull it together.
Q213 Chair: Is the logical conclusion of what you are saying, with the consequences of the NHS Bill, that health and wellbeing boards should be given their own specific budgets? What do you think?
Bill Shields: That is an interesting question, as to whether health and wellbeing boards are at the right level to be able to do that and make those decisions. They should definitely be part of that decision making.
Q214 Chair: That is what the Government’s view is. We have been asking for clarity from the Department—we have found that challenging—on exactly how the place-based integration between local authorities and the NHS is going to work. We have challenged them on the boards issue because of the cultural point and, when they come back, they basically keep saying, “Health and wellbeing boards.” If that is it—if that is going to be the main mechanism by which place-based decisions happen—what do they need to have for it to be a success?
Joe Garrod: Given my experience of local government, if I were in the Department of Health and Social Care my concern about increased borrowing powers across the system would be that people may borrow too much money and not be able to pay it back. In the local authority context, there is a legal requirement to set a balanced budget every year, which you do not have in the NHS.
Chair: That is what I mean. Shouldn’t there be an NHS budget for the health and wellbeing board to spend?
Joe Garrod: A health and wellbeing board is a partnership, rather than a constituted organisation. It ensures a hard governance stop and accountability. As a local authority person, I am a huge supporter of devolved budgets, but we need an accountability mechanism that makes an organisation accountable overall for the spend. It should be the accountable body for that budget. The risk with boards is that accountability is diffused over a range of partners.
Bill Shields: I agree with that. In principle, health and wellbeing boards having oversight makes a lot of sense because of the space that they occupy. The devil is in the detail, in terms of the governance arrangements, how you would delegate a budget to a non-statutory body, what would happen in the event that there is overspend and who is responsible for that. A regulatory framework needs to be understood and worked out if that is to be successfully done.
Q215 Andrew George: When we were in Cornwall—in my constituency—we saw a range of creative community methods of delivering neighbourhood health facilities, which achieved very substantial value for money. They worked to an extent outside the procurement rules, because they used, for example, community interest companies to deliver projects. To what extent are the rules within which you operate counterproductive in terms of value for money and of achieving the intended outcomes? [Interruption.] Sorry, it is so loud outside. I don’t know whether you even heard the question.
Bill Shields: I did. I have worked in Cornwall in the past, so I am familiar with some of the things that you said, including community interest companies and LIFTCo schemes in Cornwall. When we are looking at alternative finance, whether it is LIFT, public-private partnerships or PFI, one of the issues is that the thing that works today also has to work in 10, 15, 20 or 25 years. The length of contracts and concessions in some of these arrangements is significant. The delivery of healthcare—the way that healthcare actually operates—is likely to change quite significantly over that period, so one of the issues that we have had is getting locked into very long-term arrangements.
It is seldom the case, even if there is significant risk transfer, that alternative finance will prove to be cheaper to the public purse than accessing Government borrowing, so we need to think carefully about what we do, the flexibility that will be delivered and whether that represents long-term value for money for the public sector, so I would urge a bit of caution there. With new types of public-private partnerships, the issues are still the same. The private sector will always price risk, and there will be a premium for that risk. The public sector is not as good at managing risk, and that means that over the period of the concession, it will be more expensive. Now, that might be the right thing to do. A PFI hospital will have lifecycle built in, which would not happen in a traditional construction. Therefore, at the end of the concession, the building should still be in the same state that it was in at the start. That is very different from the way that the NHS has built things.
When it comes to LIFTCo, one problem is that we have seen, in some cases, too many assets being constructed and people not always thinking about that, as I said, from a strategic perspective: “Do we actually need that development? Could we repurpose something that is already there?” The public sector estate is significant, and I think we are quite guilty of not repurposing and using what we already have.
Joe Garrod: I agree with all that. For me, private finance and alternative financing models work best where you are dealing with portfolios of assets and you have the ability to swap assets in and out of the model. Where you hit a real challenge is that a lot of the LIFTCo facilities were let on 25 or 30-year concessions that wrapped in the debt payment, the lease payment and facilities management costs, and then if you have revenue cutbacks, you could have the situation where the services have all been cut back. When I was running One Public Estate in London from 2015 to 2017, it was littered with partly or fully vacant LIFTCo assets, because there had been revenue funding reductions and services had closed down.
Where I could see a private finance model working is for, say, smaller GP surgeries, where you know there is a need for x number of years, but if the asset is no longer needed, it could be sold by the JV partnership for a different use, or redeveloped. Waltham Forest have used that model for housing acquisition where we know we have an immediate need, but we have the ability to move assets out of the JV partnership should they no longer be needed. Traditional private finance and LIFTCo do not give you that flexibility.
Q216 Andrew George: Okay, but I am not talking just about LIFTCo; I am talking about the community interest companies—not-for-profit organisations—that are delivering those projects. On all the accounting and procurement rules within which you have to operate, I think you are saying, Bill, that it is preferable to work within those rules, constraints and straitjackets even if that results in not achieving the value for money, in terms of the initial capital outlay on the building, that you could have achieved, in the first instance, significantly cheaper elsewhere, but by other models of delivery.
Bill Shields: One significant change that has taken place between a lot of the concessions commencing and now is IFRS 16. Operating leases that were not on the balance sheet are now on the balance sheet, so you have to account for those in both revenue and capital terms. That counts against the capital delegated expenditure limit, and that then militates against the flexibility that we have seen in the past where operating leases did not. That is a very different environment from the one where—
Q217 Andrew George: Are you supporting IFRS 16? Sorry, I am not an accountant; I find all these terms rather arcane. Are you supporting the use of that particular rule?
Bill Shields: It is not a question of supporting it or not. It is part of generally accepted accounting practice, and the Government have decided that they will adopt that, so we are required to be compliant with IFRS 16. But it constrains flexibility.
Q218 Andrew George: You are required to use it, but can you see the sense in doing that?
Bill Shields: It has reduced flexibility. In terms of having greater transparency in some of the financial instruments that we have utilised, it has reduced flexibility and reduced our ability to do these things over a longer period. I think it is the case that in accounting terms it is right, but in terms of flexibility and what makes sense for the things that we are trying to develop, it is very, very difficult.
Q219 Andrew George: Explain it in the simpleton terms in which I require it, because I am not an accountant. You are saying that the IFRS 16 rule protects the public interest in some manner, but creates an inflexibility that means that you can do less and it might end up being more expensive. As I understand it, it brings the value of the lease into capital budgets and can cause a trust or ICB to breach their capital limits where funding is otherwise available, which seems rather counterproductive to me.
Bill Shields: I think that is an unintended consequence of having more transparent accounting. The purpose of IFRS 16 was to ensure that leases were much more transparent. In the past, operating leases operated very differently from finance leases. It was possible for an organisation to lease an asset, whether it was a piece of equipment or a building, and that would not feature on the balance sheet. Internationally, accounting standards moved to ensure that those were on the balance sheet, to increase transparency. From an accounting perspective, it is absolutely fantastic and really transparent; from a pragmatic perspective, it means that then counts against capital limits. That is very constraining, because it is almost like a double whammy—accounting for things in a revenue sense and in a capital sense. That really constrains the ability to look for alternative finance in the public sector and has been a massive constraint.
Q220 Andrew George: To take one example, we saw in the HSJ that your cluster pulled out of a £33 million neighbourhood fund. Presumably that was something that was desired. What was the basis of that decision? Had the estimates simply changed, or the valuations, or had the accounting rules caused it to trip up?
Bill Shields: That is the other constraint working in the NHS at the moment. Across the cluster where I work, a significant number of organisations are in significant financial difficulty. Almost every one of the acute providers has a significant deficit. The choice we were faced with was continuing to preserve the transformation fund—this is always an issue, deciding between what will work in the long term and what has to happen for short-term requirements—and thereby facilitate the shifts we want to see from sickness to prevention and from acute to community, or support organisations and help them to deal with their deficits.
Non-recurrently, for this year only, we have used most of the transformation fund to support the deficit organisations, while being very clear that we still expect the proposals that we wanted them to bring forward to happen. We inevitably would not have been able to start everything on 1 April anyway, so we are still working through the proposals with the intention that from 1 April ’27 we will have this year’s transformation fund and next year’s transformation fund—and therefore £66 million—to facilitate and fund those changes. It is far from ideal, but we had to be pragmatic and recognise that it was not acceptable to have every organisation with a deficit.
Q221 Andrew George: What do you think about the financial reforms announced in the 10-year plan, in particular the setting of five-year capital budgets? You mentioned earlier the constraint of having to work within annual budgets while construction—the whole planning, pre-planning, predevelopment, development and aftermath—is clearly going to stretch beyond one single financial year. Do you think the new freedoms—presumably, they will be freedoms—will help? What else could help to create an environment of creativity and flexibility to achieve value for money and to deliver the projects?
Bill Shields: First, yes, I agree that having five-year capital budgets will be advantageous. That will allow us to plan over a much more realistic and reasonable time horizon. Secondly, greater flexibility in terms of the ability to move capital and revenue, and vice versa, has traditionally not really happened, other than to support the revenue position, but we should be able to be much more flexible. If we have a development that has capital and revenue components, we should not be constrained by how much of that is capital and the capital limit we are working within.
Andrew George: Okay—so you want more flexibility in that area as well. I think that that that covers it.
Q222 Josh Fenton-Glynn: Where is the financial risk for neighbourhood estate projects currently being held? Is it being held in the right place? Bill might be best placed to answer.
Bill Shields: In terms of neighbourhood, to take the cluster where I work, there is a mixture. Some of that has been delegated, so it sits between the primary care provider board, particularly in Derbyshire, and one of the community providers. Going forward, we are working on developing governance arrangements for how we manage the risk: what would we delegate in terms of budgets, and what would be the governance arrangements around that?
We are still working through what the neighbourhood footprints will look like; we think there will be a range of them. Our experience is that if we do things at a very small scale, with a very small cohort, we can see some of the changes take place and actually observe them, but we have to do this at scale. We have to do this for 3.3 million people, not cohorts of 50,000 people. With the greatest respect to VCSE colleagues, they can help us to understand some of those things and be really nimble. One of the things that the NHS has struggled with is taking that nimbleness and some of those innovations and scaling them up. We have not been very good at that. We need to think about how we scale those things up and do them across the whole geography.
Q223 Josh Fenton-Glynn: Joe, you probably sit in the middle of that, don’t you? You have a reasonable scale because you are place based, but you still have to be nimble. Do you recognise that in terms of trying to balance it?
Joe Garrod: Yes, that is a very common challenge with working with the VCS. A lot of organisations are hyper local. Exactly as Bill says, it is about how you take that learning, involvement and role in service provision and scale it up. The larger the geography, the harder that becomes.
In terms of the financial risk, from an immediate local authority perspective, one of the challenges is, as I mentioned, the track record of the NHS in following through on leasing spaces. At the moment, the financial risk for the health centre I referred to is sitting with us, in that it has sat vacant for three years. With a good wind, it will probably be at least another year before it is occupied. That is four years of lost rental income. We took the debt out to build the facility six or seven years ago. It is about £100,000 a year, so I reckon that we will have lost local taxpayers half a million pounds by the time it opens. That is money we could have spent on delivering other facilities for local people.
Q224 Josh Fenton-Glynn: That is quite something, because you would expect the health service to understand the imperative. You have the asset there and you would think the NHS would fill it.
Joe Garrod: Obviously local authorities have had circa 40% budget cuts since 2010. That has presented huge challenges. But in local government there is also now a commerciality, and a real focus on needing to make the right investment and get the return. It is a different system in the NHS, where you have not had the same level of financial austerity as in local government.
Josh Fenton-Glynn: I am a recovering local government cabinet member, so I understand that well.
Sam Pluckrose-Oliver: It feels like an opportune time to talk about the VCSE sector from our perspective. I absolutely understand and agree about the financial pressures that NHS partners and local authorities face in terms of service delivery requirements. Bill made the point very well—Claire Fuller talked about this in her stocktake report—about the need to think much more expansively about the health estate, and not just about repurposing primary care, or building new GP NHS centres.
If we look directly back to the experience of the covid pandemic, the role of community spaces in the vaccination programme was fundamental to that working, because they knew where people were, and people who might otherwise not have come for their vaccination would come to those places to get it. Part of the very complex solution speaks to the point about the appetite and demand for community-led spaces. The community ownership fund, which closed at the beginning of last year—
Q225 Josh Fenton-Glynn: You keep using the phrase “community-led spaces”; could you define that?
Sam Pluckrose-Oliver: They are spaces that are run and led by community organisations. That could be a local charity or a type of social enterprise like a community benefit society or a CIO—that kind of thing— rather than spaces led by the local authority or the NHS, or a private space. A community centre, a community café—that sort of thing.
Q226 Josh Fenton-Glynn: Is there a governance arrangement that people think would work better to allow the health service, local authorities and VCSE organisations to share space better?
Joe Garrod: In Waltham Forest, we have a VCS lettings policy, whereby we offer rental reductions of up to 80% of annual rent based on an organisation’s social impact. We look at the value that the organisation brings to local people, there is an assessment framework, and that is then reflected in a reduced rent.
Q227 Josh Fenton-Glynn: When I look back at my days as a councillor, that feels like the kind of thing you would do for a few years and then, after a while, an officer would say, “We could also look at the rents again and see whether we could bring them into line.” How secure are they? I do not mean for you specifically, but that does not feel like a very secure model, unless there is a clearer national direction on stuff like that.
Joe Garrod: I agree that anything that is set locally can be changed with changing priorities. Equally, things that are set nationally can be changed with changing priorities.
Bill Shields: On managing the financial risk, when we think about the delegation of budgets and of financial responsibility, it leads me to think of the lead provider arrangements. The organisation that manages the financial risk should be capable of dealing with that financial risk. The delegation of neighbourhood budgets is quite significant. If they are dealing with all the healthcare in that neighbourhood, it needs to be an organisation that has the ability to deal with that. That will militate against some of the smaller organisations leading that, but that does not mean they should not be involved in that arrangement.
Q228 Josh Fenton-Glynn: We are moving towards the One Public Estate model, which helps to support integration. How does it work? Does it have potential?
Joe Garrod: One Public Estate is two main things. It is a method of partnership working—you bring together a board representing major public sector landholders in an area. If VCS organisations are major landholders in a particular community, it brings them into the board as well, so there is that partnership arrangement. You look at your assets in totality, and the opportunities, and then the programme has provided Cabinet Office funding to undertake feasibility studies. I have seen a huge amount of very positive projects move into delivery. They have been funded with a small feasibility grant from Cabinet Office—say, £200,000—and have gone on to be multimillion-pound programmes that have delivered very significant impacts for residents.
Josh Fenton-Glynn: Sam, you look like you are itching to get in.
Sam Pluckrose-Oliver: Yes. I want to make two points, one about demand and one about models of governance. One of the things that we found in the analysis of the community ownership fund, which is a £150 million fund that closed early last year, was that it was 12 times oversubscribed. The total value of the expressions of interest that communities made to that fund was about £1.8 billion. There was a huge amount of demand for assets of community value in those places to be brought into community ownership. There are examples of the health system, of the NHS, nationally and in local areas, taking that initiative and that focus.
What has been incredibly interesting, and seems to compare very starkly to the wider neighbourhood health centre agenda, is the neighbourhood mental health centre agenda. It started with very small pilots and is being grown out under the 10-year plan. There were six initial places nationally that took part in that pilot, four of which happened in spaces that were community-led, or rather that were not NHS or local authority-led.
There is an example of one in Whitehaven, in Cumbria. What happened there was that the community mental health trust had the funding from NHS England under the pilot. They bought a local shutdown Halifax bank on the high street, paid for the refurbishment and everything, and then they asset transferred that over to Copeland community trust locally, who now run that as a neighbourhood mental health centre. As the NHS lead on that programme talks about, it is an ordinary building on an ordinary street. They very much designed it not to have wipe-clean sheets and clinical white hallways. There is an independent evaluation of the programme coming out later in the autumn, so I absolutely direct the Committee to look at that when it comes out. The anecdotal evidence across those places on the impact on just one metric—keeping people out of crisis—is huge.
Chair: We did an entire report on this, I am sure you are aware. We have looked at it in some detail.
Sam Pluckrose-Oliver: I just wanted to compare that with what seems to be happening in the neighbourhood health centre agenda, which is very much not about that approach. It is very much about new build, PFI, or dealing with existing NHS estates. A lot needs to be learned from that when the evaluation comes out. There are a lot of reasons why that model can work equally as effectively for physical health and wider health, and not just for mental health conditions.
It is about marrying the level of demand for community-led spaces as part of the health infrastructure with the ability and success of those models, and trying to think very differently—in a cultural way, in a strategic way, locally, nationally or regionally, wherever it is—about how you use the community estate, if we want to call it that, as part of the wider health estate and as part of the wider One Public Estate. I don’t think that is happening at all to the level it needs to at the moment.
Q229 Chair: I have one final question, which I often ask. If there was just one thing that you would urge us to make sure that we press on when we are trying to knit some of this together and encourage the Department to do things differently—just one, I am afraid—what would it be?
Joe Garrod: A governance system that facilitates collaboration and accountability.
Bill Shields: Greater flexibility and delegation in the ability to use capital funds, and also flexibility between capital and revenue. I think the points made earlier about multi-year allocations will help to support that.
Sam Pluckrose-Oliver: To move away from what seems to be the recent direction in DHSC and NHS Property Services—this focus on NHS and public estate first—and think much more broadly about what a community health infrastructure estate looks like. [Interruption.]
Chair: Saved by the bell. Thank you very much.