Health facilities and services are often key constituents of this kind of integrated regeneration scheme. NHS primary care trusts (PCTs) and general practitioners (GPs) are particularly appropriate partners for local authorities as health and community services such as leisure and libraries are often teamed together to produce positive social outcomes.
We are working with a number of authorities that are procuring or considering options to procure similar integrated multi-use facilities with multiple stakeholders. A key consideration for such authorities is the choice of procurement method, which is determined by a number of factors including funding, costs, timing, expertise and resource to name a few.
Where private finance initiative (PFI) credits are available, we have seen authorities take the lead in redevelopment and have PCTs join their procurement. Some of the PFI projects that we have worked on in the past have looked to do just that, such as the Lewisham Downham Lifestyle Centre, which combined library, leisure and health accommodation as well as parkland; and Rotherham Borough Council’s Leisure and Joint Service Centre project, which included a joint service centre and multi-occupant facilities to include a PCT. We have also seen authorities team up with private sector developers, colleges and universities, and combine projects with other programmes which they lead such as Building Schools for the Future (BSF).
However, within NHS local improvement finance trust (LIFT) areas, can NHS LIFT be used as a procurement method for delivering these types of schemes?
NHS LIFT is now a well-established initiative with more than 44 LIFT companies (LIFTCos) in place across
Each LIFTCo is a joint venture company between a procured private sector partner (which has a majority equity stake) and a combination of PCTs and Partnerships for Health (a subsidiary of the Department of Health). In a number of cases, local authorities have also taken an equity stake in the LIFTCo, although they do not need to do so in order to use NHS LIFT as a procurement method.
The key document in NHS LIFT is the 20-year strategic partnering agreement between (usually) all the local NHS organisations (including PCTs) and local authorities within the LIFTCo area. Each of the public sector organisations can use the LIFTCo to deliver schemes (but only the PCT must do so).
What type of scheme can be delivered by LIFTCo? Usually the Official Journal of the European Union (OJEU) notice that initiated each NHS LIFT scheme refers to ‘community-based health and social care facilities’. In some cases the OJEU is wider and may refer to, for example, delivering leisure facilities. Where a local authority and the local NHS partners want to provide a joint service centre delivering health and social care then not only can the authority use NHS LIFT, but there are many strong arguments that it should.
Where a LIFTCo is a strong, performing delivery partner within the area and has strong supply chain relationships which are currently delivering within the area, utilisation of such a method by a local authority can improve timetables and allow authorities that may not have the expertise or the resources to conduct procurement to utilise an established tried and tested structure.
Rob Hann, legal director at local government procurement specialist 4ps, is a strong advocate of this method of delivery. He recently said: “LIFT can help local authorities successfully deliver joined-up health and social care services. It is surprising that more authorities are not choosing this route as they have the demand for such services and the right skills and capacity to deliver them using LIFT.”
Hann mentions
Must NHS LIFT be used to deliver these types of joint service centres? As many PCTs are subject to exclusive arrangements with LIFTCos, for a PCT to be involved in a local authority initiative the project would either have to be delivered through the LIFTCo or the PCT would need to be excused from its exclusive partnering arrangements with its own LIFTCo for the authority to lead. The LIFTCo may understandably be unwilling to do the latter, certainly on any sort of regular basis.
If NHS LIFT is an obvious route for delivering joint service centres, comprising principally health and social care, the position is more complex — and interesting — for larger schemes comprising a much larger element of ‘social infrastructure’, i.e. leisure and community facilities, libraries and possibly also education facilities and facilities for the emergency services (Police and Fire Authorities).
Such schemes have been delivered through NHS LIFT (the Burnley Town Centre scheme is a well-known example). We are also advising on a scheme in the southeast that is delivering an element of social housing and extra care accommodation. Will we see more such schemes being developed through NHS LIFT?
LIFTCos are able to build developments that include facilities which are not used for ‘community-based health and social care’. There are many examples of affordable and private housing subsidising the public sector facilities, with some examples of commercial development as well. However, if LIFTCo is building something for a local authority as opposed to developing part of a site for third-party income, then full procurement regulations will come into play.
We have advised on a number of such schemes involving swimming pools, libraries, social housing and other leisure facilities. There is no simple answer — it is too simplistic to assume that the scheme will fall within the original procurement if overall there is more ‘health and social care’ than ‘leisure’, but we are usually able to find a way forward.
And it is important to do so. Due to the exclusivity arrangements that PCTs enter into in the strategic partnering agreement, PCTs cannot easily form part of a wider local authority-based leisure-led scheme without the consent of LIFTCos.
Delivering health separately to leisure and the other elements of social infrastructure is more expensive (integrated schemes can enable up to 30% build cost savings) and there is evidence that health and leisure integrated facilities lead to better health outcomes, not least because of improved access to health facilities.
We are going to be seeing more regeneration schemes involving leisure, health, education and other elements of social infrastructure. Local authority leisure-led schemes will continue to be an essential procurement option, but at least in NHS LIFT areas, NHS LIFT is likely to become an increasingly important option for authorities.
Penny Rinta-Suksi and Mark Calverley are partners at Bevan Brittan.