The government has unveiled a £20bn programme to save England’s NHS estate. Here’s how it will work

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A major trauma centre complete with rooftop helipad is planned for Salford Royal Hospital

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It will be the biggest hospital building programme in a generation. It represents a huge commitment to strengthen the NHS estate. Five more hospitals will be added to the list of 40 to be built announced in 2019, and many will be completed in 25% less time than initially predicted using modern methods of construction. 

All of this, announced by health secretary Steve Barclay in the House of Commons last month, sounds like good and welcome news. But the long-awaited reboot of the government’s New Hospital Programme (NHP) was immediately met with a flurry of negative headlines. Buried within Barclay’s announcement was an admission that seven hospitals would not be completed before 2030, the original target date for the programme’s 40 hospitals.   

Barclay blamed the delays on the disruption caused by two years of the coronavirus pandemic and pressure from construction price inflation.

Delivery times for these schemes had also clearly been affected by the addition to the programme of five more hospitals that were found to be at risk of collapse because they were built using reinforced aerated autoclaved concrete (RAAC), a lightweight material used up until the 1980s which has now passed its 30-year lifespan. These hospitals have been pushed forward for rebuilds because surveys have found they will be unsafe to operate beyond 2030. 

“I think expectations have been set very high..When those expectations are not met, then you always risk getting negative commentary.”

Simon Rawlinson, head of strategic research and insight at Arcadis

What has riled many is that it has taken three and a half years, three prime ministers and five health secretaries for the government to provide any real clarity on how the NHP will actually work.

First announced by Boris Johnson in September 2019 in the run-up to that year’s general election, the pledge has always been seen as a campaign soundbite. Clearly details were always going to change as the programme  developed, especially given the events of the past three years. So is the criticism of the delays fair?

“I think expectations have been set very high,” says Arcadis head of strategic research and insight Simon Rawlinson. “When those expectations are not met, then you always risk getting negative commentary. 

“The programme will demonstrate its value when it delivers hospitals. The fact that the money is being allocated, and people are being mobilised, is the most important bit. That’s great news. But it is only when somebody gets to cut the ribbon on the new hospital, and they’re done – that’s when it really counts.”

Victoria Head is the commercial and performance director and head of programme and project management at Archus, a healthcare infrastructure consultant. Archus worked with the NHP during the early stages following Johnson’s 2019 announcement of the programme and is now working with two trusts that form part of the NHP, the Leeds Teaching Hospitals NHS Trust and the Hillingdon Hospital NHS Trust. 

“I think it’s a hard one,” she says when asked if she buys Barclay’s explanation of the delays. “Given that the RAAC projects were added, there was going to be some movement on the end date of completion, and because it took probably longer than expected to get to an announcement around the funding envelope and which schemes are being progressed, it’s a natural fallout.”

At-a-glance: the rebooted New Hospital Programme

  • The rebooted New Hospital Programme (NHP) is using a modular design concept called ‘Hospital 2.0’ for at least 14 schemes. These will be built using standardised components and modern methods of construction, aiming for 25% faster completion.
  • NHP schemes have been split into four cohorts, with two hospitals in the first cohort having already been completed and a third due to open later this year.
  • Ten schemes in the second cohort are now ready to proceed. Two in this cohort which are not yet approved will be built as ‘Hospital 2.0’ schemes along with seven in cohort three.
  • Five more hospitals have been added to list of 40 first announced in 2019. These will be rebuilds of hospitals which were built using RAAC, a lightweight form of concrete used mostly in the 1960s and 1970s which is now decaying and putting buildings at risk of collapse. 
  • At least seven of the original list of 40 hospitals are no longer expected to be completed before 2030, the original deadline set in 2019. Steve Barclay said the delay to these schemes was a result of pandemic disruption and construction inflation.
  • A project delivery partner (PDP) will be appointed to oversee the NHP. It is expected to be a consortium of project management firms and will be appointed following a call for competition which will be posted on the government’s procurement portal by September this year
  • Award criteria for the PDP job is currently based on people and behaviours, including a behavioural assessment, delivery approach, transformation approach and social value. Price criteria will be based on social value, pay rates for the PDP leadership team, overheads and fees.

So, aside from adding five new hospitals, why has it taken the government so long to set out a detailed plan for the programme? From day one, Department of Health officials have struggled to work out how to implement Johnson’s initial pledge, and how to reconcile it with the NHS’s long-term needs. The response, outlined by Barclay last month, has been to develop a concept known as “Hospital 2.0”, a new type of repeatable hospital scheme built using standardised components that can be constructed quickly and maintained at a much lower cost over a longer period of time.  

Victoria Head Project Director Gleeds

Victoria Head

Head says the challenge of aligning this ambition with a long-term healthcare plan while ensuring that the market has the capacity to carry out the work has “taken far longer than we possibly anticipated”.

She adds: “The aspiration for the NHP to take it through a programmatic look across healthcare has grown and the scale of that probably wasn’t estimated from day one. So being able to influence the whole project lifecycle in a programmatic way meant that the timeline slipped and they were unable to make decisions as quickly as they had hoped.”

Nick Markham, the minister in charge of the NHP, has claimed that programme leaders had resisted political pressure to “go, go, go and start building” because they wanted to ensure the design was right first. He has now called for a “Nightingale-style” approach, referring to the temporary covid hospitals built at speed during the first weeks of the pandemic, to bring together supply chains and get the work done on time.

Head says the pandemic, the go-to excuse for politicians trying to explain broken promises, has been “fundamental” in terms of how the programme has changed since 2020. Covid has transformed how healthcare is delivered and how hospitals are designed. 

Healthcare infrastructure now needs to be ready to respond to pandemics, which means the NHP needs to ensure parts of hospital buildings can be isolated to prevent the spread of contagious diseases. It also means ventilation systems need to be capable of being ramped up to increase and improve airflow. All of this has meant initial design assumptions for NHP schemes have been sent back to the drawing board. 

“It’s a knock-on effect of actually taking learning from the pandemic to make sure that the hospital infrastructure for the future is more resilient and ready to respond to pandemics in the future,” says Head. “I can see how it’s very frustrating.

“But, when you set that against a market which has had a worsening skills shortage and we have lived through a European war which has impacted on materials and skills, there is a culmination of impacts there which means that we are in a harder situation to deliver this.”

Although using MMC was considered by the NHP since the earliest days of the programme, the approach is now seen as essential to making up lost time. It also allows the government to save some face, although Barclay’s insistence that schemes will be built 25% faster is undermined by the fact that this time saving has already been more than wiped out by how long it has taken to confirm the approach. Use of standardised components has also been confirmed on just 14 hospitals so far.

But the NHP see the Hospital 2.0 concept as the long-term solution to the NHS estate’s crippling £10.2bn maintenance backlog. It aims to allow hospitals across England to be maintained using the same kit of parts, rather than manufacturing bespoke components at a higher cost. This will include standardised bed head units, which will allow hospital staff to know exactly where things like data points, medical equipment and power sockets are located in inpatient rooms wherever they are in the country. 

“That is the intention of what needs to come from this kit of parts. It helps them not only in the development, manufacturing and construction of the new facilities, but also provides operational benefits for the NHS. As you can imagine, in an emergency situation, it brings great benefits to doctors and nurses,” says Head.  

Statistics on the NHS

  • Government spending on the NHS is around 10 times more in adjusted figures than it was when the service was first set up. In its first full year in 1948, spending was £11.4bn at 2019 prices, compared with an actual £153bn in 2018/19. GDP and total government expenditure has only grown by a factor of 4.8 in that time.

  • The total cost of running the NHS estate in 2021/22 was £11.1bn, an increase of 8.8% on 2020/21.

  • The total cost estimate to eradicate the maintenance backlog – work that should already have taken place – was £10.2bn in 2021/22, an increase of 11% on 2020/21.

  • The number of doctors working in the NHS has grown by 40% since 2010. The number of nurses has grown by around 17% since then. 

  • The proportion of patients waiting less than 62 days for treatment after GP referral is down from nearly 90% to less than 55% in past 10 years.

  • The proportion of patients spending more than four hours in A&E is up from 7% to more than 50% over the past 10 years.

  • The number of people on waiting lists for hospital treatment is up from 2.5m in 2010 to more than 7 million in 2023.

What the NHP is trying to do is prevent each NHS trust from getting bogged down in prolonged discussions with clinical end users about how facilities are designed and constructed, Head says. Standardisation aims to ensure a solution which has been tested and has an evidential base, following consultation with medical bodies, is available for all future hospital projects.

MEP modules will also be “componentised”  where possible, meaning that the large modules currently used, sometimes several metres in length, can be assembled from smaller mass-produced parts which are cheaper to make, rather than designing bespoke units.

Although standardisation has been used for some time on government healthcare frameworks, of which the current iteration is P23, the NHP is trying to make the approach the default rather than the exception. “This will hopefully be a catalyst for making sure it happens across the piece rather than just because some project teams are more engaged with it than others,” says Head. P23, the £9bn fourth generation of the ProCure framework for the design and construction of NHS capital projects, is not intended as the main procurement route for the NHP, although the NHP has reserved the right to use the framework.

The physical structure of new buildings will be standardised, with set floor to ceiling heights and repeatable rooms, although it is currently unclear what materials will be used. Head says that this is where the next level of clarity is needed from the NHP. It needs to demonstrate how the schemes can align with the government’s net zero targets.

The question that the NHP and the government will need to answer now is whether this approach is enough to fix the creaking NHS estate’s systemic problems. When unveiling the new plan last month, NHP chief programme officer Morag Stuart said the programme was “genuinely trying to transform a very significant part of the NHS system”.

Chris Shaw, founder of healthcare architect Medical Architecture, says that, “generally, people should welcome any commitment to funding but this is in the context of a really, really bad situation”.

He says the reason why the NHS has accumulated such a large maintenance backlog is because of the failure to regularly refresh hospital buildings, something that needs to be done around once every 15 years. 

“You don’t really have any understanding of long-term planning in the NHS, which is unfortunate because it makes the UK quite different from most other European countries,” he says. This has resulted in a significant loss of the skills in engineering, architecture and construction needed to deliver new buildings or refurbishments.

Compounding this, Shaw says, is that design guidance and building standards for patient safety, spatial organisation, engineering and infection control in hospitals are “woefully out of sync” with legislation. “That’s pretty problematic for, for example, a contractor on a significant project where you don’t really have a compliance framework to work with.”

Leeds Teaching Hospital

Source: Perkins & Will

The Perkins & Will plan for Leeds Children’s Hospital on the site of the Leeds General Infirmary

NHS trusts often underspent capital budgets, partly because the business case process is complex and does not easily align with the NHS and the Treasury’s decision-making cycles. Unspent funds then often get used up by revenue, meaning that the backlog remains unaddressed. 

Shaw also warns of unintended consequences of the standardisation approach, which could lead to mistakes being repeated across multiple major schemes. A historical example of this is the use of RAAC, the structurally unsafe concrete which has resulted in those five hospitals built with the material being shoehorned into the NHP. These hospitals were part of a system build programme in the 1960s and 70s where rapid construction was the priority. 

Rawlinson says the greatest challenge faced by the NHP is not necessarily how the hospitals will be built, but how systems will be integrated. This is famously the post-construction snag which delayed the Elizabeth line by two years as project teams failed to recognise the challenge of integrating multiple signalling systems until after the line was built.

>> See also: Industry needs ‘Nightingale approach’ to achieve £20bn hospitals plan, programme chief says

>> See also: Construction yet to start on all but seven of government’s 40 new hospitals

“A programme delivery layer is about getting all of the bits together, not just the building,” he says. “When you have got really high levels of systems integration and complexity, then you need people to be able to focus on those bits.”

Clearly, the negative media response to Barclay’s funding announcement needs to be seen in the context of decades of government neglect of the NHS. Delays to the programme were met with exasperation, partly because, to many, they were expected. But, regardless of whether that reaction was fair, will the relaunched NHP now be the solution the NHS needs?

Some 100 trusts bid for what was supposed to be the last eight places on the NHP. In the end only the five RAAC hospital rebuilds were confirmed. What is going to happen to those hospitals which did not make the list? Private finance initiatives (PFI) which have been used to fund NHS capital projects since the 1990s were wound down in 2018, and while the government has described the NHP as a rolling programme, it is not yet clear exactly what that means. Funding of £20bn for the NHP is a significant announcement, but without any alternative sources of investment for those hospitals not on the programme, large swathes of the healthcare system are still facing a crisis of capital for which the government is yet to provide a realistic and sustainable long term solution.

“It’s a move in the right direction but in reality it isn’t enough money to solve the crisis,” says Head. “Underinvestment over previous years means the estate has got worse. This should not be seen as the panacea or the end of the road. Don’t think that this will solve everything because it absolutely won’t.”

Join us at the Building the Future Commission Conference

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You can join the Building the Future Commission Conference  in Westminster on 27 September to hear from leading figures across the construction industry and find out more about the work of the commission.

The day will include panel debates on net zero, digital transformation and building safety as well as talks from high-profile keynote speakers on future trends and ideas that could transform the sector.

There will also be the chance to feed in your ideas to the commission and to network with other industry professionals keen to share knowledge. 

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About the commission

The Building the Future Commission is a 12-month project looking at radical and challenging ideas that could help transform the built environment.

The campaign aims to tap into innovative ideas, amplify them and be an agent for change.

The major project’s work will be guided by a panel of major figures who have signed up to help shape the commission’s work culminating in a report published at the end of the year.

The commissioners include figures from the world of contracting, housing development, architecture, policy-making, skills, design, place-making, infrastructure, consultancy and legal. See the full list here.

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Building the Future is also undertaking a countrywide tour of roundtable discussions with experts around the regions as part of a consultation programme in partnership with the regional arms of industry body Constructing Excellence. There is also a young person’s advisory panel.

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