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Government pledges that affordable homes will be built on surplus NHS land

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NHS staff will be given first refusal to buy up to 3,000 new homes that are set to be built on health service land deemed to be surplus to requirement, according to the government.

Thousands of new homes will be built on unused and surplus health service land across England, said the Department of Health and Social Care today, in its formal response to a review on the use of NHS estates.

“I’m delighted that NHS trusts will be able to offer a right of first refusal for these homes to hard-working NHS staff”

James O’Shaughnessy

The department said the money generated by the release of the surplus land would be reinvested directly back into NHS services, enabling patient care to be delivered in state-of-the-art facilities.

The announcement follows 17 recommendations made in March last year by Sir Robert Naylor’s NHS Property and Estates review, of which 15 have now been accepted in full by the government.

Sir Robert, former chief executive of University College London Hospitals NHS Foundation Trust, was asked to look at the issue in response to comments in Lord Carter’s review of hospital productivity.

Under the plans, the DH said NHS staff would be given first refusal to buy up to 3,000 new homes, which will most likely be set out in contracts with property developers who buy these lands.

The same pledge was first made by health secretary Jeremy Hunt in October at the Conservative Party conference, as part of a package of measures to improve the retention of NHS staff and boost workforce numbers via new routes into nursing.

In order to achieve its aim on affordable housing, the DH also reiterated an earlier announcement that there would be a new national NHS Property Board established to oversee the release of surplus and unused NHS land.

In addition, it repeated that a dedicated £3.9bn capital investment fund, announced in the autumn budget, would be available to support the release of the surplus land and speed up the process.

The funding represents the government’s contribution to a £10bn target that the review said was needed to make the NHS estate fit for purpose. The rest is intended to come from land sales and private investment.

“The NHS now needs to take urgent action to modernise its estate, dispose of unwanted assets and secure private sector investment”

Robert Naylor

The government added it was guaranteeing that funds generated by local land sales, via sustainability and transformation partnership plans, would be reinvested directly back into NHS services.

It noted that the NHS estate was the second biggest expenditure for the health service after its workforce.

Speaking on the plans, health minister Lord James O’Shaughnessy said: “It’s critical that we invest in the NHS estate – if we want to deliver world-class healthcare, we need world-class facilities.

“By utilising unused and surplus land we can ensure the NHS is supporting its staff by freeing up land to build more affordable homes, and I’m delighted that NHS trusts will be able to offer a right of first refusal for these homes to hard-working NHS staff,” he said.

Lord O’Shaughnessy will chair the newly established NHS Property Board, which will oversee this transformation work, and act as a “single point of leadership for the NHS on all estate matters”.

Among others, the board will bring together the functions of the current NHS Property Services and Community Health Partnerships.

However, a recent report from a think-tank called into question whether staff would be able to afford new homes built on surplus land, as reported by Nursing Times.

It claimed homes being built on land sold off by the NHS will be largely unaffordable for nurses, suggesting government pledges to offer staff “first refusal” may be “worth little” in some cases.

A total of 59 sites have so far been sold by the NHS as part of the government’s public land sale programme, aimed at easing the housing crisis, said the report from the New Economics Foundation.

Among the homes being built, 80% are for sale at market rate prices – but the report found four out of five of these will be too expensive for nurses to buy.

Meanwhile, the numbers quoted by the department today are significantly less than predictions made less than two years ago by one of its arm’s-length bodies.

Back in 2016, the head of the regulator NHS Improvement said plans were being drawn up to build 22,000 affordable homes on excess health service land.

Speaking at the NHS Confederation annual conference, Jim Mackey said the new homes would be offered to staff in areas like the capital, where key workers were being priced out of the market.

In his independent review, Sir Robert made 17 recommendations to the government and warned that the NHS would be held back in futureproofing care without £10bn investment.

He said funding could be sourced from three separate areas – capital investment from the government, sale of surplus estate and private sector investment.

Over the coming months, the Department of Health and Social Care will set out how the new £3.9bn capital funding will be spent and invested in estates transformation by 2022-23.

This would include £2.6 bn to support local plans to transform estates and modernise facilities, as part of STPs, in addition to £425m already announced earlier this year.

Robert naylor

Robert naylor

Robert Naylor

There will also be £700m to help NHS estates that need urgent maintenance or upgrades, and £200m to support specific programmes targeted at making savings and improving efficiency.

Sir Robert said: “I welcome the government’s positive response to my review and its £3.9bn commitment to the £10bn needed to transform the NHS Estate.

“The NHS now needs to take urgent action to modernise its estate, dispose of unwanted assets and secure private sector investment, particularly in primary care,” he said.

He added: “The government’s recognition of my calls for additional capital investment, improving strategic capability and incentivising local action, is essential to delivering an NHS estate fit for the future.”

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