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GPs consider court action as premises costs threaten practice viability

GPs consider court action as premises costs threaten practice viability

Dozens of GP practices based in premises owned by NHS Property Services (NHSPS) are considering legal options in response to new lease terms they are being asked to sign. A number of practices in the south of England as well as a large multi-practice commercial provider are taking legal advice in response to new terms that may be less favourable and which seek to formalise huge service charge hikes some practices have seen.

Practices in health centres with historically informal arrangements with NHS Estates have been handed draft heads of terms for new leases, negotiated with the BMA. But some face huge increases in service charges for parts of their premises they share with other occupants, and less favourable terms.

Some practices have received invoices that include charges for services they don’t receive or have never previously been charged for. Additionally, some practices face big increases in facilities management bills from NHSPS for the areas of the premises they use exclusively.

LMCs have warned the increased charges could leave 10% of practices in England unsustainable, with five- or six-figure bills. Around one in five GP practices nationally are in NHSPS properties - suggesting half of these practices are at risk. The changes are being implemented by NHSPS because it was required by the government - which owns it - to operate on a commercial basis and end historic subsidies for practices in NHS-owned premises. Changes could also see some practices paying less as the landlord works out what share of each premises individual practices use.

Dr Gaurav Gupta, chair of Kent LMC where around 36 practices are affected by the new leases, said no practice ‘in their right mind’ would sign the new lease terms until the issue of increased charges is resolved. Dr Gupta said his own Faversham Medical Practice is at risk of destabilisation and service cuts because of a 400% increase in charges demanded by NHSPS, from £15,000 in 2014/15 to £80,000 last year.

GPonline has learned that a number of practices across the country are considering legal action over their leases. Lawyers have advised GPs they may be able to apply through courts for more favorable terms. Under the Landlord and Tenant Act occupiers paying rent and with exclusive possession of a premises for six months or more can ask the court to formalise their tenancy on their existing terms.

In a letter last month GPC premises lead Dr Ian Hume advised practices that heads of terms issued by NHSPS were not enforceable but a ‘first step to negotiation’. The GPC’s position, Dr Hume added, was that practices must be satisfied that charges are reasonable before making payments. Transitional arrangements offered by NHSPS, the letter said, should only be entered into once practices are satisfied with lease conditions.

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