Challenges and Solutions for the NHS Estate (CIPFA)
Some time ago, I was kindly asked to participate in the roundtable for the CIPFA insight piece linked here. Here are my takeaways:
Chronic Underinvestment
The NHS estate faces a maintenance backlog of £11.6 billion (2022/23), with repeated delays in the New Hospitals Programme (NHP), undermining infrastructure development.
Capital budgets are often underspent at the national level, despite severe local needs, due to systemic inefficiencies.
Multi-Year Capital Planning
Calls for multi-year capital settlements to replace the current system of single-year allocations, which leads to rushed, suboptimal spending.
Alternative Investment Models
The roundtable again called for improved opportunities to explore public-private partnerships (PPP) and suggested that collaboration with local governments might be a way forward.
Integration with Broader Public Assets
NHS infrastructure planning should be more co-ordinated with other public sector assets under initiatives like One Public Estate.
What needs to change
Unfit Capital Regime
The NHS capital regime is described as “designed to frustrate capital delivery,” with complex approval processes and inefficiencies.
Criticism extends to government reluctance to discuss private financing options, such as PPPs, despite growing needs.
Reactive, Not Transformative
Current capital allocations are often used to maintain failing infrastructure rather than pursuing transformative projects. This reactive approach hampers innovation and long-term sustainability .
New Hospitals Programme (NHP)
The NHP is criticised for not having delivered as planned, with increasing doubts about its viability.
IFRS 16 Implications
The introduction of IFRS 16 accounting rules has created complications, requiring leases to count against capital budgets, which some (including me) argue is inappropriate for capital budgeting.
Political Influences:
Decision-making is influenced by political priorities rather than clinical or strategic needs. This leads to funding allocations based on political imperatives rather than system-wide benefits.
