In August last year I explained why I was seeking information about NHS Property Services (NHSPS). The organisation ‒ landlord to many NHS properties in the south west and nationally ‒ introduced ‘market rents’ in April 2016, described by the British Medical Association in evidence to the House of Commons Health Committee as “unjustifiable and for some practices unsustainable”.
I can now provide an update on progress towards obtaining disclosure of a review that preceded these rent increases.
But first: in September 2020, the Department of Health & Social Care (DHSC) published conclusions of a long-awaited review that appeared to suggest fears of privatisation might be misplaced:
“There was little evidence that there would be overall benefit to the NHS of NHSPS divesting itself wholesale of any functions in the short to medium term. It should instead focus on working with customers (tenants and NHS commissioning organisations) to agree what they need from a property company/strategic partner, and how NHSPS can deliver this for the benefit of the system.”
More recently, in March 2021, the Chair of NHSPS, Ian Ellis, was replaced by Jane Hamilton. Ian Ellis’s background was firmly in corporate property management, with previous roles as head of UK investment management at CBRE, and Executive Chair of Telereal Trillium. US-based CBRE is the largest real estate business in the world; Telereal Trillium owns over 12,000 UK properties, is valued at more than £8bn, and is owned by the secretive William Pears Group. Jane Hamilton’s background is very different: she is currently Chair of the University of Exeter Council, a former member of the Institute for Cancer Research Board of Trustees, and has experience in government as well as corporate property services.
Reassuring perhaps, but reference to “the short to medium term” in DHSC’s review conclusions suggest caution. So too does a document I originally requested in August 2019, which has now been disclosed, although heavily redacted.
This is a review of NHSPS conducted by Deloitte for DHSC. It runs to 132 pages, but key sentences are frequently redacted. For example:
Redactions cause this chart, which summarises phases of change recommended by Deloitte, to become particularly unilluminating:
However, reading this alongside another document now disclosed but also originally refused when first requested twenty months ago, makes DHSC’s intentions less opaque. This is a relatively short report written for the Minister of State by the Department’s Commercial Director in August 2011, recommending setting up the company that became NHSPS. Identified advantages include:
Many of the redactions made to both documents use an exemption provided by Section 43 of the Freedom of Information (FoI) Act, concerning “commercial interests”. DHSC claim disclosure “would be likely to prejudice DHSC’s commercial interests”. As a ‘qualified exemption’, application of S.43 is subject to a ‘public interest test’, and DHSC conclude “this information is commercially sensitive as it involves discussion of DHSC’s ongoing ability to operate in a commercial environment and secure best value for the Department. Therefore, DHSC considers that releasing this information would not be in the public interest.”
The exemption is also used to protect Deloitte’s commercial interests:
“DHSC consulted the authors of the report, Deloitte, who have requested that Appendices 6 and 9 be removed under Section 43 (commercial interests) as the information contains their working methodologies which it considers has intellectual property value and which would damage their commercial interest in regard to competitors if disclosed. The Department fully supports this view.”
Deloitte has many connections with both DHSC and NHSPS. Media reports in March 2021 revealed that the £323m-worth of work commissioned from Deloitte by DHSC for its Covid-19 testing programme included: “draft and respond to parliamentary questions, Freedom of Information requests, media queries and other reactive requests”. One of NHSPS’s Non-Executive Directors was previously Director in the Corporate Finance team at Deloitte.
NHSPS Board minutes from 2018 report discussions on evictions of tenants, including GP practices, for which Ministerial approval was being sought. This did not happen, and the pandemic must have removed it as a feasible option.
However, a further cause for concern that reining back on privatisation may only be temporary, comes from a refusal by DHSC to disclose the full review from which the conclusions were published in September 2020. This refusal used the exemption provided by Section 35 of the FoI Act, relating to the “formulation or development of government policy”.
I was told by DHSC:
“The document includes candid evaluations and risk assessments by officials involved in the assessment process and frank consideration of the strategic, performance, financial and future challenges facing the Company. It was only completed in 2020 and is therefore of a very current nature. These deliberations are also relevant not just to NHS Property Services, but also to the Department’s other shareholdings and to ongoing value for money considerations about their potential futures…
“The exemption is intended to ensure that the possibility of public exposure does not deter from full, candid and proper deliberation of policy formulation and development, including the exploration of all options, the keeping of detailed records and the taking of difficult decisions. Therefore, DHSC concludes that the public interest in withholding this information outweighs that in its release.”
I will seek disclosure of at least some of the redacted material in the 2011 and 2014 documents, and question the withholding of the 2020 review. But, taken together, there are very real grounds for thinking the option of selling-off the company, considered back in 2011, remains very much a live issue.
