Doctors owe £422m of unpaid property payments

NHS Property Services, which manages around 10% of the National Health Service’s estate, was set up less than six years ago, to run NHS properties including hospitals and doctors’ surgeries. The estate was previously owned and managed by health authorities and primary care trusts and the portfolio is valued at over £3 billion.

The company is owed over £422 million in overdue rent, service and management charges which its tenants say are the result of a rapid increase in the costs imposed on them.

Rebellious tenants, represented by the British Medical Association, have accused NHSPS of imposing astronomically high price increases, saying that it was “no surprise that some practices are not simply handing over cash they do not have.”

The overdue debts are £8 million higher than a year ago, although the company’s accounts show that £103.4 million has already been written off.

The increase in costs has come at a time that the NHS is already stretched financially, but the NHSPS said that the new costs represented the market rents of the properties. It said the new costs represent the actual running costs associated with the buildings and that it only sought to recover direct costs from tenants, rather than making a profit, as did the landlords of other NHS tenants.

Some of the properties had been handed over to NHSPS without a formal lease agreement in place, which has exacerbated the problems associated with implementing market rents and service charges on the properties.

The increase in service charges was blamed by one GP surgery in Nottinghamshire for the dissolution its the GP partnership. Whyburn Practice said in a statement that the practice had been made financially untenable. The statement said:

“For several years, WMP has been subject to a large increase in the service charge relating to the NHS Property Services owned building that it resides in, leading to a dispute. These highly inflated charges and other business issues have resulted in the business becoming financially unviable.”

The NHSPS manages surplus NHS property through a disposals programme. Among those properties listed are Bassetts Campus in Bromley, M-Block in Gravesend, St George’s Hospital in Hornchurch, St James’ Hospital in Portsmouth and Westbury Community Hospital in Wiltshire. Planning permissions for redevelopment are now being processed for redevelopments on these sites.

If you’re looking to purchase a new build or refurbished property in Bromley, Gravesend, Hornchurch, Portsmouth, Westbury – or anywhere else in England or Wales – ask an Independent Chartered Surveyor to carry out a building survey before you buy.

Back to January 2019 Newsletter

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