Practices Squabble Over 400% Lease Hike

Numerous GP practices have refused to sign up to new leases that would see fees increased by vast rates in the region of 400%.

The rates put in place by NHS Property Services (NHSPS) are now being challenged by numerous surgeries.

Defending the apparently extortionate rate rises, NHS Property Services stated that the rate rises have not been based on a recalculation of fees.

Instead, it is asserted that the changes can be attributed to GPs receiving their full bill direct from NHSPS, and now being forced to recoup the cost from NHS England.

Previously, it was picked up by the Primary Care Trust, so the authorities assert.

Meanwhile, four GP practices within one singular NHS region have refused to pay the new rates, instead offering payment equal to last year’s levels.

Minutes from Berkshire, Buckinghamshire and Oxfordshire LMC raised the example of one local practice which has paid approximately £15k per annum historically, but has seen fees rise to in excess of £53K.

GP leaders believe that the market valuations reached are in many cases completely unreasonable.

Berkshire, Buckinghamshire and Oxfordshire LMC medical director, Dr Jim Kennedy, states that refusing to pay rates should be considered usual practice in a situation where there is an industrial dispute.

Kennedy particularly believes that it is extremely unusual for radical changes to be made to such an arrangement without at least some form of discussion with a tenant.

“The reality is a lot of these properties have been underinvested in by their landlords, the NHS, for a long period of time. So the issue is, are they really worth market rent? The cost of bringing them up to standard should not fall completely on the practices. Another big area of concern is the scale of management charges being imposed by PropCo. All the commercial guys have told us “if I were getting that sort of rate I’d have died and gone to heaven.”

Commenting on the issue, an NHS Property Services spokesperson attempted to outline the procedure that had led to the rate hikes.

“From April this year, what has changed is that the total cost of occupation is now transparent in bills, as is the way NHS England subsidises practice costs. Through this transparency, commissioners can make well-informed decisions about service locations and encourage efficient use of space. When contacting occupiers, both the Department of Health and NHS England have been clear that any increases in rent will be fully reimbursed and recently, all CCGs have received full details of the processes they need to follow to complete the reimbursements”.

Nearly 1,000 GP surgeries have experienced rate rises as a result of the new procedures.

 

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