Vital Signs – A Primary Healthcare Blog: GP Property Costs Threaten Public Health Standards

Property millstone is contributing to the problem of low GP recruitment.

Helen McArdle's recent article in The Herald ( Record number of GP practices taken over by health boards amid doctor shortage) highlighted how an escalating crisis in the recruitment and retention of Scottish-based doctors has resulted in an increasing number of GP practices now having to be run by health boards. While only one in 20 surgeries in Scotland currently fall under this criteria, this number is on the rise, up by 25 per cent in the past two years.

This development is all part of a worrying trend where the NHS is struggling to cope with a fall in the number of junior doctors wanting to specialise in general practice, not only across rural communities but now, increasingly, in urban areas of Scotland.

There are a number of factors contributing to this decline, one of which is the financial burden imposed on many GP surgeries through their property lease agreements. This issue stems back to the mid-1980s when the Conservative government wanted to bring more private money into building new doctor's surgeries. Instead of lending GPs money to build their own they handed the responsibility for developing new premises to the private sector which would finance the new building then lease it back to GPs, a model which acted as a precursor to the Private Finance Initiative (PFI).

Many of the 30-year leases signed at that time are now coming to an end, with the GP practices facing restoration bills which can be as high as £500,000. Most of the doctors who signed these leases are now retired, leaving the younger partners having to pick up these significant dilapidation costs.

It's therefore unsurprising that we are seeing an increasing decline in newly qualified doctors who want to be GPs. In a small surgery, one partner can potentially be left as the "last man standing" as part of the lease agreements, required to repair the premises out of their own pocket. Very few surgeries are run as limited companies or limited liability partnerships, so not only is their medical practice exposed but their houses and their pensions are also on the line.

Of the circa 200 GP practices that our firm represents in Scotland, most are facing a challenge over recruitment and property is usually one of the issues behind this. Given what is at stake in having to take on such commitment which comes with the real prospect of an almighty and rather costly legal argument further down the road...