Cracking the Da Vinci (Estate) Code

5 December 2007

The better than forecast Health spend in the Comprehensive Spending Review 2007 will not however remove the need for efficiency drives and to maximise value from a Trust’s assets.

With that in mind it is a useful opportunity to review “Core Elements” (Health Care Building Note 00-08), the long awaited update to Estatecode published in May this year.

Chief Executives – property is your responsibility!

The new Estatecode is noticeably more comprehensive than it’s predecessor, bringing together formally disparate areas of NHS property regulations which previously required some lateral investigation to locate. The main part of the guidance is the “Core Elements" referred to above but there are 16 other subjects covered by the Health Care Building notes each focusing on specific areas such as pathology, diagnostics or in-patient care.

Whilst, in many cases, it does not say anything new, it certainly says it much more clearly. It does however confirm that responsibility for all property matters rests with the Chief Executive – notwithstanding any delegation of that responsibility!

“Core Elements” is broken down into five sections:

The first is Overview. This section puts estate matters into the context of wider Department of Health initiatives such as practice based commissioning and patient led commissioning.

Corporate manslaughter

This section confirms CEO and Board responsibility for Estates matters (paras 1.9 to 1.13). If safe and properly maintained estates previously seemed secondary to clinical necessity the spectre of corporate manslaughter changes next year perhaps ought to change that view.

Strategy is next, providing a useful overview of the planning process and how that should be factored into Estate Strategy. This also leads into guidance on preparing the SSDP and other longer term strategic plans.

Procurement is a new section detailing this highly complex area of law as it is essential to get proper advice on each individual case but this chapter does at least flag exactly when such advice should be sought.

The fourth section is Acquisition and Disposals - the bread and butter of an estates department which should be familiar to all. The advantage of the new draft is that is at last separates out Freehold and Leasehold matters into separate chapters. Different considerations apply to each and they deserve this separate treatment. The Leasehold sections are also a valuable reminder of how ‘standard’ lease practice (such as length of term, rent review provisions etc) has changed since the last edition of Estatecode.

Management is the final section and contains excellent practical advice on resolving (and more importantly avoiding, matters which traditionally have blighted NHS estates such as undocumented occupiers.

Estate Terrier – is yours ‘fit for purpose’?

Of particular interest is the guidance on Estate Terriers. The recommendation now is that it should be computerised (para 10.23) and must include an “events diary” for all leasehold matters (para. 10.24). This is to ensure that potential problems and costs associated with missed break dates or rent reviews are avoided. If your Terrier is still an information resource and not a management tool then perhaps a revamp is required?

The guidance on insurance (paras 10.73 to 10.79) also raises an interesting point.

Foundation Trusts - are you insured?

As (hopefully) everyone should know, the maximum payout per claim under the Property Expenses Scheme is £1million. Whilst this is insufficient cover for catastrophic damage there is nothing an NHS Trust can do as they are prohibited from purchasing commercial insurance. Estatecode guidance (para 10.77) is that in the event of such damage the affected Trust must consult with its SHA and DoH on appropriate funding of the reinstatement.

Yet is this the case for Foundation Trusts? FT’s are not similarly prohibited from opting out of the scheme and purchasing commercial insurance. Moreover, they are free from central Government control, in charge of their own finances and are responsible to Monitor. As Monitor would not have the same resources to assist, do they consult with their SHA and DoH?

Whilst it is hard to imagine an SHA and DoH not acting to assist, a prudent FT might want to ask the question now, rather than wait until after an incident!

For more information or advice, please contact Thomas or Stewart.

The content of this bulletin is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.