Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, whether his Department has made an assessment of the potential merits of NHS England underwriting leases for GP practices.

Under the GP Contracts, premises liabilities are the responsibility of the contractor. Overall contractual payments reflect this arrangement, with the National Health Service also reimbursing direct premises costs including rent, business rates, water, and clinical waste.

There are 8,842 practice premises across England, of these, 51% are leased premises. The NHS is not a formal party to the leases on these properties. If NHS England were to consider a formal underwriting of the leases, legal advice notes, that would constitute a commitment, which would require capitalisation under the International Financial Accounting Standard IFRS16, and limited NHS capital budgets would have to be diverted to offset this commitment, in addition to the payment of rents against the properties.

This would provide, in effect, a double payment of costs against the asset and would commit substantial capital funds to the exercise, limiting the ability of integrated care systems to invest in the primary care estate, address secondary and community care, mental health services, and critical and usual infrastructure maintenance requirements, significantly adversely affecting the overall investment plans for communities. As a result, NHS England considers that a formal underwriting of leases would not provide best use of public funds.