Construction industry ‘losing appetite’ for NHS builds


Delays to new hospital designs as part of a programme to speed up their construction has cast doubts over the construction industry’s “appetite” to build the new facilities.  

Aspects of ‘Hospital 2.0’, a “cheaper and faster” standardised approach to hospital design and construction under the government’s New Hospital Programme (NHP), are running at least five months behind schedule, a Public Accounts Committee (PAC) report warned. 

That delay has hindered engagement with the construction industry on design and the commercial pipeline of work. 

“There are big questions about the [construction] industry’s capacity and appetite to build the required number of hospitals in the new way and to a very tight timetable,” the report states. 

Further, the latest version of Hospital 2.0 is “very likely” to produce hospitals that are too small. 

The original commitment by government was to build 40 new hospitals in England by 2030 under the NHP. 

But due to slow progress, high costs, uncertainty of funding, scope and timetabling, as well as a lack of transparency in scheme selection, it is “highly unlikely” even to construct the 32 hospitals under its 2020 definition, the committee warned. 

Adding: “The Public Accounts Committee has no confidence that government will deliver the new hospitals it promised.” 

It also found the Department of Health and Social Care (DHSC) failed to include in the programme seven “structurally unsound” hospitals it knew of in 2020, leaving five out of the scheme until May this year, around the time five major hospitals were found to contain significant amounts of reinforced autoclaved aerated concrete (RAAC).  

The DHSC’s decision to reset the programme at that point had the effect of delaying eight other hospitals, which now will not complete until after 2030. 

By early 2023, the DHSC had identified 41 NHS buildings with RAAC. 

The government now has two months to respond to the findings. 

“The physical edifice that is the NHS is quite literally crumbling before our eyes,” said Dame Meg Hillier MP, chairperson of the committee. “There was nothing inevitable about this heartbreaking crisis. It can be laid squarely at the door of the decision to raid budgets reserved for maintenance and investment in favour of day-to-day spending. The sharp distinction between capital and revenue budgets exists for a reason. We are now seeing the consequences of this short-termism visited on patients and services. 

“In such circumstances, then, it is bitterly disappointing to report on the current state of the NHP. Quite aside from the fact that the planned new hospitals risk being too small for future purposes, funding does not even appear to be in place to construct them in time, all underpinned by failures of basic record-keeping and fresh and urgent concerns over RAAC.  

“Though we have no confidence that the NHP will deliver on its current promises, we hope that the recommendations in our report help to get it back on track – for the sake of all citizens who desperately need the NHS to get well soon.” 

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