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Report: ‘Win-Win’ NHS land deals with HAs could save trusts £6bn

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Report: ‘Win-Win’ NHS land deals with HAs could save trusts £6bn

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Published by Brian Church for 24dash.com in Housing and also in Health

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The NHS could save £6 billion over 25 years by teaming up with housing associations to use surplus land for supported housing, claims a new report by the Smith Institute released Thursday.

Report author Paul Hunter, who is also head of research at the independent think tank, said: "This study shows there are significant savings that could be made through joint ventures between housing associations and NHS trusts. Using surplus land for supported housing could help to deliver efficiency savings for NHS trusts and improve healthcare. It is a 'win-win' opportunity."

The study is called 'NHS surplus land for supported housing: Why now and what are the possible cost savings?' It argues that using surplus NHS land for supported housing (which is significantly more cost effective than treating people in acute hospital wards) offers NHS trusts better value for money than selling the land off for private development. It says the NHS could save around £75,000 per year, per home if a mental health patient was transferred to supported housing (run by a housing association) rather than staying in an acute ward. £50,000 per year could be saved if an older person was transferred from an acute ward to a supported home.

Innovative partnerships between NHS trusts and housing associations can also create additional public assets in the form of much needed extra supported housing. This approach can strengthen the balance sheets of trusts and offer long-term savings rather than securing one-off land receipts, the report argues.

The findings show possible savings based on surplus NHS land being sold at present values alongside potential demand for supported housing. For example, the report says "using NHS land for supported housing offers significant scope for reducing delayed discharges which cost the NHS around £200 million per year, provides less expensive care whilst allowing patients to be more independent, and reduces unnecessary (re)admissions".

The study argues that, unlike other early intervention programmes, using surplus land can help meet the upfront capital costs of building supported homes. Factoring in build costs over 25 years, £1.6 million could be saved on a supported housing unit for those with mental health problems, and £1 million for older people.

The research argues that on current values (ignoring inflation) over a 25-year period this would provide an annualised return on investment of 7% for mental health supported housing and 5% for supported housing for older people. “Given that the calculations ignore inflation, these yields are arguably higher than just selling the land and investing elsewhere, whilst providing a better service,” it adds.

The research is based on the current levels of land being sold at the same rate, with 367 supported homes being built each year for 15 years rather than being sold privately. This would require relatively small parcels of land being used.

One Housing Group supported the research project. Its group director for housing care and support , Kevin Beirne, said: "This research shows just how significant the improvement in recovery and savings could be nationally and will hopefully kick-start more partnerships and joint development work for the benefit of patients and the NHS."

The report is available from www.smith-institute.org.uk.

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