Unlocking capital to invest in healthcare’s physical environment has never been more important, yet many Trusts fail to develop an effective estate strategy which is essential to access funding, argues Melanie Relf, Associate in Healthcare Strategy and Planning at Lexica.

As we witness an extraordinary time in the history of the NHS, the service continues to grapple with its biggest challenge to date, the impact of Covid-19.  This combined with the fact that investment in the NHS was at an all-time low prior to 2020 resulted in an extensive backlog of maintenance and development, plus grossly under-funded national healthcare building standards. Today, we are also in the early stages of the biggest building programme of new hospitals for a generation, so why do so few Trusts have an estate strategy in place?

Estate strategies are frequently overlooked but may now be the key to launching a successful bid for funding, so it is vital that Trusts take a closer look. These uncelebrated documents have recently taken a larger role on the healthcare stage, because of the New Hospital Programme; where previously considered optional, they now play a critical role in securing a much-coveted place on the ‘Go’ list.

The 2005 NHS Estates document Developing an Estate Strategy states, “All NHS Trusts, including primary care trusts (PCTs) and foundation trusts, are advised to have an estate strategy,” however, it was not obligatory, despite also being described as “an essential precursor to the allocation of capital.”

An estate strategy is the first step towards producing a Strategic Outline Case or Outline Business Case for any investment scheme.  Despite the ambiguity of the document’s status, there are recent instances of schemes being rejected from the New Hospital Programme due to a lack of an estate strategy.

Developing an estate strategy

Investing time and resource into developing the key elements of an estate strategy is imperative, to facilitate a strategic review of current capacity and capability and support strategic change in terms of location, scalability and quantity. These include a description of all the accommodation and buildings owned by a Trust, a review of the activities the Trust undertakes in those buildings, and whether the amount and quality of the accommodation suits the Trust’s existing requirements, as well as future plans. This then enables a conclusion to be drawn as to:

  • whether the accommodation can be reallocated more efficiently
  • whether services are unnecessarily duplicated
  • where there are gaps in the service.

At Lexica we often see examples where the clinical or services strategy is used as a base document to extract pertinent information to create the estate strategy.  If the clinical strategy is not current, the Trust may feel it is in a challenging situation. Strategic thinking by healthcare planning experts can overcome this using clinical evidence and best practice to make logical deductions, without waiting for capacity projections, but there is a strong argument for decoupling the Estate Strategy from Clinical Strategy. Buildings last decades, whereas clinical strategies have considerably shorter life spans.

In addition to the baseline information required within the estate strategy, the opportunity exists to incorporate several other aspects to ensure a Trust’s accommodation will meet its requirements beyond the next ten years. These include: 

  • flexible estate
  • agile working
  • resilience
  • sustainability and Net Zero Carbon
  • digital transformation
  • MMC (modern methods of construction)
  • derogations
  • innovation.

Net zero carbon in strategic estate planning

A paradigm shift is taking place in the NHS, transitioning estate planning priorities towards delivering upon sustainability objectives.  Since the publication of the NHS Operational Planning and Contracting Guidance in January 2020, the NHS requires all new buildings and refurbishments to meet net zero carbon standards, and business cases must include net zero ambitions and planning or risk push back from NHS England and Improvement (NHSE/I). 

NHS specific guidance for delivering net zero in Spring 2021, provided much needed details and information for integrating net zero principles into the estate.  There is much that can be done now to prepare for net zero carbon, including identification of significant opportunities for decarbonisation and rationalisation of buildings and space. Key opportunities for NHS sites include:

  • Shifting from steam systems to low temperature hot water to enable heat pump technology
  • Reducing office space in favour of agile working
  • LED lighting upgrade opportunities
  • Ensuring contracted partners are also committed to net zero through tendering processes
  • Consideration of energy and resource requirements from clinical interventions, such as MRI scanners
  • Enabling access to public transportation and integrating electric vehicle charging infrastructure

Planning for net zero as part of the estate strategy is critical, and must be anticipated, designed, and costed in at the earliest stages of estate and project planning. Lexica is supporting several NHS clients to prepare for net zero and has developed design briefs with key interventions required aligned to each RIBA stage to support delivery of net zero.

As we move through the 2020s, the NHS will face some of its toughest challenges. Strategic estate planning is essential in the wake of coronavirus, alongside securing all important capital funding to ensure a fit-for-purpose healthcare estate for generations to come.