General Practitioners: Service Charges

(asked on 18th July 2017) - View Source

Question to the Department of Health and Social Care:

To ask the Secretary of State for Health, what recent representations he has received from GP practices on service charge increases.


Answered by
Philip Dunne Portrait
Philip Dunne
This question was answered on 24th July 2017

All general practitioner (GP) practices who are tenants in properties owned by the Department’s property companies - NHS Property Services (NHSPS) and Community Health Partnerships, which between them own about 20% of the GP estate in England - are subject to service charges related to their occupancy which are raised in the financial year to which they relate. Where these charges have not been paid in prior years they remain outstanding and overdue for payment. Occupiers are not currently charged interest on any overdue payments.

The Department is aware that many GPs have complained through different channels about the impact of the introduction of the market rent model by NHSPS to the National Health Service in January 2016, which applies the property sector’s standard method of charging. It was part of a long-planned move across the public sector to improve utilisation and value for money in property occupancy by putting publicly-owned property on a level with privately-owned alternatives, the most common model of GP ownership.

As part of the new market rents model, invoices should be based on accurate property information such as the precise amount of space used, as well as reflecting an assessment of the facilities provided for that space, e.g. cleaning, reception services and maintenance. This data was not always available in predecessor primary care trust or strategic health authority records.

Where an NHSPS building is leased to an NHS service provider the tenant pays rent, service charges and facilities management costs. However the rental, business rates and water and sewage elements of the charge are reimbursed back to the NHS service provider, via NHS England and the local clinical commissioning group. The Department has provided an additional £127 million to the NHS England Mandate with effect from 2016/17 financial year to fund these increased costs within the NHS of this policy change.

Within the Premises Cost Direction 2013 under sections 46 and 47, there is the facility for the GP to apply to NHS England for transitional funding related to large increases to non-reimbursable charges such as the balance of the service charges and facilities management costs.

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