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JOINT FUTURE AGENDA: SHORT LIFE WORKING GROUP ON JOINT PREMISES DEVELOPMENT IN PRIMARY AND COMMUNITY CARE: FINAL REPORT
PART 4 - REVIEW OF EXISTING DEVELOPMENTS - LESSONS
11. Existing Developments - Lessons
Vision and Leadership
Vision
11.1 To maximise service benefits to the user, providing partners need to establish an understanding of users, their needs and how these can be best served. This provides the basis for a whole system service vision for the community, which can then be used to develop a joint delivery strategy that will align key priorities and determine joint objectives. Joint strategies to achieve these objectives may or may not involve the co-location of services. The development of joint premises is an enabler to better joint service provision, not an end in itself.
11.2 The majority of completed joint premises projects reviewed for this report contained at least one partner with a vision for and a dominant focus on the wider community benefit of the development. Many completed developments between the NHS and Councils were opportunistic rather than systematic, driven by the availability of the Primary Care Modernisation Fund (PCMF). While it is important to acknowledge the success of the PCMF in encouraging joint solutions, it is also worth noting that in successful joint developments funded by this process at least one partner espoused a wider joint service vision to take advantage of the opportunity. Where local partners have failed to align key development priorities, it is evident that schemes for joint premises development have not progressed.
Recommendation 1: Local partners develop a joint service vision for the community to provide a focus and support for joint planning and from which an agreed joint strategic service development plan and related strategy for relevant joint property provision can be put in place.
11.3 Delivery might take place around the community-planning table or be more focussed on discrete services/care groups, for example, within a community health partnership. The model of delivery through which this might take place may be a wholly public sector model or some form of PPP model. The choice of model is independent of the requirement to establish a joint service vision and strategic service development plan.
Strategic Leadership
11.4 Underpinning the successful establishment of a joint service vision, agreement of joint objectives and the development of joint strategies cannot is the human factor. Every successful scheme reviewed for this report had a "champion", an individual or individuals with a demonstrable and powerful commitment to overcoming organisational barriers in pursuit of realising a joint service vision. Although, it is not possible to conclude that "champions" are an essential component of success for the development of joint premises projects, experience from existing projects suggests that it is important for individuals to assume this responsibility.
11.5 Given the level of time and commitment required to overcome organisational barriers a suitable supply of "champions" may not exist in every community. This is especially so where agencies hold entrenched positions and change is unwelcome. Without "Champions" joint developments will inevitably be delayed and made more difficult. The identification of suitable individuals to advocate, pursue and realise a joint service vision to underpin joint premises is a significant step in making joint premises happen.
Recommendation 2: Local partners encourage "champions" to promote joint premises development. See also Recommendation 12 at section 11.4.2 below that highlights to need for local "champions" to gain the necessary skills and experience required to effectively carry out such a role.
Communication
11.6 Partnership working is a learning curve that requires time, energy and commitment. Leaders require to overcome inconsistent organisational approaches between partners and the bureaucracy frequently encountered between two separate institutional models and cultures. Successful schemes have shown that the wider commitment of all local partner organisations to joint working is essential. This commitment ensures that policies and approaches to joint working are consistent and accessible to those who will need to implement them. The position is the same for the development of joint premises as for other parts of the Joint Future Agenda.
Recommendation 3: Local partners develop an appropriate internal and external communication strategy to foster the right attitude and commitment to joint premises development by local partner organisations and their staff.
Development Principles and Risk Culture
Development Principles
11.7 Existing Scottish Executive guidance on property transactions is not conducive to partnership working between NHSScotland and local government. This is due to the potentially significant impact of local managers taking a narrow single sector perspective of these matters in evaluating the affordability and best value of joint schemes.
11.8 Cross-sector use of assets is not facilitated by the current 'silo' approach to asset ownership, sale and transfer and the need to demonstrate affordability and best value only from a single sector perspective. Our review of many completed joint development schemes identified significant complication and delay while partners sought approaches to resolve sector specific issues.
11.9 Where it can be demonstrated that a joint strategy will deliver joint objectives as a whole notwithstanding the fact that some individual elements, such as joint premises, may not meet narrower sector specific requirements it is crucial that the bigger picture is recognised.
Recommendation 4: The Scottish Executive and local partners should recognise that the principle of maximising the community benefit of heritable assets is a crucial consideration for progressing the Joint Future agenda. The principle needs to be incorporated into mainstream property management policies and decision-making in both the NHS and Local Government. Accordingly, NHSScotland and Local Government should develop compatible systems for mapping heritable assets and for property management processes.
Scottish Executive Legislation and Guidance
11.10 Legislation and guidance needs to be amended to ensure that local joint strategies can be progressed and wider development principles employed as part of the sector-specific consideration of affordability and best value as a whole across local participants. Current Scottish Executive guidance has focused on the need for NHSScotland or Local Government to safeguard individually public assets and to deliver best value within their own statutory parameters.
11.11 The Joint Future agenda has changed the relationship between the NHS Bodies and Local Authorities. The challenge now is to deliver better, seamless and flexible services. Inevitably, this requires NHSScotland and Local Government to take a cross-sector approach; but existing guidance often inhibits cross-sector working rather than promotes it.
11.12 The policies, procedures and processes applicable to NHSScotland and Local Government property management reflect the separate processes in each sector. This can be an obstacle to local managers looking to implement more flexible ways of working between health and local government required by the Joint Future agenda.
11.13 The Scottish Executive recognises the importance of establishing clear, consistent guidance for cross-sector developments, as evidenced by the establishment of the Public Services Delivery Group and the Community Planning Task Force. The Scottish Executive is already revising the Scottish Capital Investment Manual (SCIM); undertaking a review of certain relevant sections of the Scottish Public Finance Manual relating to capital; and later in the year will review the NHS Property and Transactions Handbook. Our recommendations should inform these activities.
Recommendation 5: The Scottish Executive and local authorities should consider our recommendations as part of any existing and proposed reviews of legislation and guidance that constrain joint premises development with a view to supporting crosscutting work and removing barriers at a local level.
Partnership Risk Culture
11.14 Public sector bodies are bound by regulation and guidance. This approach has the advantage of providing strong safeguards for the protection of public assets. However, it is arguable that this approach deters NHS Bodies and Local Authorities from maximising the potential of their joint assets at a local level.
11.15 Completed schemes often exhibit a lead developer who takes on the key design and build risks on behalf of a local partnership. If any significant partner in a development scheme is unwilling to undertake necessary development risks the scheme is likely to be abandoned or suffer significant delay as the remaining partners explore alternative forms of delivery. In effect, an over-cautious approach to development by one partner can give rise to missed opportunities for all, and a general loss of value for the taxpayer.
Recommendation 6: The Scottish Executive should review existing regulation and guidance from the perspective of removing requirements that deter local innovation and development of opportunities while maintaining necessary safeguards to protect public assets. The Scottish Executive should also consider current procurement policy and practice within NHSScotland and Local Government with specific regard to joint developments by encouraging appropriate flexibility within the agreed confines of public accountability. See also Recommendation 11 at section 11.4.2 below.
Systems and Processes
General
11.16 Our review shows that a strategic community wide group encompassing all providing partners and service users establishes a strong starting point for joint working. From this group, joint-planning systems, procedures and processes emanate to facilitate service planning, budgeting and reporting to underpin joint premise development. Over time, these systems and processes can be mainstreamed within the partner agencies to provide the most robust form of support for joint development planning.
11.17 Where there is no previous history of community wide development it is doubtful that the necessary systems exist to deliver joint developments in the short-term. More importantly it is likely to take some time to mainstream joint development planning where it is unfamiliar. Delay results in an opportunity foregone in respect of joint development projects because of the absence of effective leadership, commitment and planning. Existing schemes demonstrate that incongruent service planning, budgeting and reporting mechanisms undermine joint development.
Recommendation 7: Local partners should develop joint strategic service development planning, budgeting and reporting mechanisms which can be supported by joint premises development. These arrangements should be mainstreamed within normal planning and development systems where possible. The Scottish Executive should support the development of appropriate templates to assist the implementation of this recommendation by local partnerships.
Property Management Information
11.18 Property identification was a key factor in the delivery of completed projects. Without a thorough knowledge of the heritable assets controlled by partner organisations it is more difficult for them to plan on a cross sector basis.
11.19 Currently, NHSScotland requires asset-owning bodies to maintain a comprehensive database of property information. The level and detail of property information collected by Local Government is less consistent, although asset management is expected to develop under the statutory Best Value and prudential capital frameworks provided by the Local Government in Scotland Act 2003. Another significant development is the "Definitive National Addressing (DNA) for Scotland" Initiative funded by the Modernising Government Fund.
11.20 It is important not to under-estimate either the significance of appropriate property identification as a lever to assist joint service delivery, or the challenges of establishing an appropriate cross-sector information system to assist this task. While information systems are currently being piloted in a number of areas, the development time for an appropriate portable solution to assist joint property development is likely to be considerable.
Recommendation 8: Local Partners should draw up compatible and appropriate joint property databases, initially for community care services but preferably more widely, to act as a reference source for all statutory agencies and to assist joint service planning and development.
People Challenges
Motivation & Performance Management
11.21 Successful schemes have demonstrated that where local managers are encouraged to plan jointly, incentivised to achieve agreed joint objectives and assessed on their delivery of these planned objectives, desired outcomes are much more likely. Conversely, where organisational goals have not been agreed and joint working has not been applied to co-ordinated performance management arrangements, joint planning and property development has seen insignificant activity.
11.22 Joint planning and development to maximise community benefit needs to become an organisational commitment both in NHSScotland and in Local Government. From this, staff development and required changes in working practices can be introduced strategically through communication of the joint vision and an organisational development strategy agreed between all the partners.
11.23 In essence, success with joint development has occurred where staff in each of the partner organisations understands through good communication the joint vision, objectives and service strategy. The property development aspects are integrated into the performance management targets of managers within the respective partner organisations, and the managers are incentivised to deliver the joint targets.
Recommendation 9: Local partners should co-ordinate staff performance management arrangements and ensure that managers within each organisation are incentivised to plan jointly and assessed against delivery of commonly agreed objectives. Performance management targets within respective organisations should be integrated for joint developments.
Skills & Experience
11.24 Where there is little or no experience, either in the NHS Body or the Local Authority, to deliver an active joint planning agenda, this lack of experience to promote joint working and innovation can be a serious constraint to the development of joint premises. Individuals with appropriate professional knowledge and skills can further develop and advance their own skills through the practical experience gained by delivering successful schemes. The level of professional knowledge, skills and experience of staff expected to project manage joint NHSScotland/Local Government property developments is a critical factor in the successful delivery of any scheme. The availability of appropriate expertise needs to be carefully considered by local partnerships seeking to implement joint developments.
11.25 The learning curve for this type of work can be steep. Where there is little history of previous joint working it will be crucial for partners to carefully assess existing skills gaps and identify staff development needs to enhance their capacity to undertake joint developments. To assist this process a national skills development programme is likely to be necessary to promote and embed good practice.
11.26 Finally, following on from the consideration of the importance of local "champions" to promote the development of joint premises, it would appear appropriate that the necessary skills and experience required to fulfil such a role should be considered within the context of appropriate staff development, skills enhancement and training.
Recommendation 10: Local partners should assess the level of appropriate staff knowledge, skills and experience available within their respective organisations when considering joint premises developments.
11.27 Where appropriate a local skills development programme should be put in place (or alternatively a national programme accessed) to address skill gaps and staff development requirements. Local partners should consider enlisting additional support or consultancy to develop their community planning process and joint service plans.
Recommendation 11: There is a specific role for staff development in relation to the development of appropriate knowledge, skills and attitudes towards risk management of joint projects and the importance attached to the identification and realisation of opportunities created by the Joint Future Agenda. Local partners should ensure that staff development arrangements specifically address this matter.
Recommendation 12: The Scottish Executive should ensure that the Joint Future Organisational Development Group should be asked to consider how elected members, non-executives, senior managers, estates management professionals and staff can be better equipped to champion the joint premises implications of the Joint Future agenda.
Financial Challenges
Initiative Funding & Sustainability
11.28 In this report, we recognise the significant role that pump-priming funding for small-scale projects under the Primary Care Modernisation Fund (PCMF) has played in enhancing joint working and encouraging joint premises development. The Primary Care Modernisation Fund is a clear example of the appropriate use of non-recurrent, limited funds to initiate desired developments by local partners. This initiative has been very successful in developing the types of behaviours in local areas that will provide a suitable environment for the ongoing development of joint premises.
11.29 Nevertheless, while it is important for the Scottish Executive to initiate change through a bidding process like the PCMF, it is important to recognise that such an approach is not appropriate for joint premises in the longer term. Our review found that many of these projects, identified in response to the PCMF, where capital funding was made available through a bidding process, addressed the immediate needs of local partners without the backdrop of an overall strategy for joint services. Recent changes in the capital budget allocation process within NHSScotland means that control over the core capital programme exists at Health Board level. The progression of capital schemes from mainstream funding within the NHS is therefore subject to local determination.
11.30 Our review suggests that the wider implications for joint premises development and its strategic support for joint service objectives have not been sufficiently considered by local partners. To date, where appropriate strategic planning processes are not established, development has been opportunistically driven by a strong focus on immediate changes as opposed to longer-term strategic joint service improvement. To deliver sustainable benefits local partners need strategic service development and financial planning. This should be supported by the emphasis within the Best Value duty provided by the Local Government in Scotland Act 2003 on contributing to the achievement of sustainable development.
11.31 Initiative funding has proved useful as a means to kick-start joint working on premises, its primary focus. We noted that the PCMF was not designed to establish the strategic and longer-term processes between the NHSScotland and Local Government necessary to underpin joint premises development. To do that means ensuring that joint premises developments form part of the mainstream revenue and capital funding considerations of the respective local partners.
Recommendation 13: Local partners should develop joint service plans identifying future client centred services which will utilise existing mainstream financial and planning frameworks. Proposals could be agreed through the Community Planning framework.
Recommendation 14: Local partners should employ their Joint Resourcing Financial Framework to develop medium-term financial plans which support joint property development, through recognition of the baseline for property costs of aligned/joint services and costed action plans for proposed service changes.
Bridging Finance
11.32 Our review of existing projects found that local partners used the PCMF as a form of bridging finance to facilitate larger joint premise schemes. The absence of available and timely bridging finance is a difficulty regularly cited by local partners around joint service and related premises development.
11.33 While the lack of dedicated bridging finance across organisations is an issue within NHS Bodies and Local Authorities, the particular difficulty for joint development arises from the need to justify its use to all the partners especially in the absence of a wider joint service strategy.
11.34 The use of joint medium-term financial plans which form part of the new joint resourcing financial frameworks developed by Local Partners as part of their partnership agreements should assist with the identification of appropriate projects, their financial implications and their funding requirements.
11.35 Local Partners need to put in place appropriate mechanisms to identify the impact of bridging costs arising from cross-sector projects that represent good value for the taxpayer. Local Partners should then address these bridging costs through the establishment of appropriate joint arrangements to secure short-term funding. It is important that they have clear ownership of joint premises developments, and the identification and sourcing of short-term finance to facilitate such projects demonstrates this commitment.
Affordability, Best Value and the Evaluation of Business Cases
11.36 NHSScotland and Local Government are required to ensure that developments are affordable and provide best value for the taxpayer. These requirements are currently assessed through the preparation, evaluation and approval of business cases for each project.
11.37 Business case regimes differ between NHSScotland and Local Government. It should be recognised that accountabilities are very different for public capital within NHSScotland and Local Government and that this is unlikely to change. In the context of PFI/PPP, the Scottish Executive needs to develop joint approval processes to support such schemes, currently each partner evaluates joint proposals against a framework of existing activities and competing single agency priorities. The standard for a joint development is therefore more stringent than single agency developments in that the project is required to compete against a broader spectrum of priorities and financial pressures.
11.38 Different Business case regimes and the absence of a framework for tying in joint scheme affordability with those applicable in each organisation give rise to delays, missed opportunities and increase the potential for failure.
The impact on joint affordability of NHSScotland's cost of capital rules and national tax regimes such as VAT may be significant. Where this situation occurred in completed schemes it created extra work for local partners, with related resource implications. Taxation (including VAT) remains a matter for the HM Treasury, and is therefore unlikely to be easily simplified but there may be some value in addressing the NHSScotland's cost of capital regimes in relation to joint premises development. Establishing a more consistent basis against which to judge the joint affordability and value of proposals should make the process more effective and efficient.
Recommendation 15: Local partners should develop a set of agreed joint objectives and service development strategies that are integrated with their own corporate objectives.
11.39 This recommendation complements the work of the Joint Future Implementation Advisory Group that is leading development of joint service strategies based on agreed partnership vision and joint objectives.
Recommendation 16: Local partners should conduct their appraisal of proposed options for service reconfiguration within the context of joint service development strategies through existing mainstream business case regimes.
Recommendation 17: The Scottish Executive, NHSScotland and individual Local Authorities should ensure that arrangements for business case approval should be amended so that each body is required to consider strategic partnership and joint services as part of their option appraisal process (in the same way that the "Do Nothing" option is currently required).
Recommendation 18: The Scottish Executive should examine the differing cost of capital regimes that apply to NHS Bodies and Local Authorities to identify a suitable cross-sector model capable of providing a more consistent basis on which to judge affordability and best value.
Public Private Partnerships
11.40 In general terms, we have found that joint premises projects at the smaller end of the scale have, to date, been less suited to the traditional PFI model. Nevertheless, while no projects had been taken to completion at this time, a number of developments were in the process of final agreement or procurement. An example is the Forfar and Kirriemuir Community Resource Centre, a hospital PFI project also involving the refurbishment of a local authority residential home for people with dementia, led by the NHS Trust with a sub-contract to the Local Authority. Recent developments in England around the batching of smaller schemes to create a commercially viable "critical mass" may provide opportunities for future development in this area. Again the key context for such developments would be sound strategic planning arrangements.
11.41 In the light of the increased complexity involved in the joint development of such schemes PFI has been limited to date. Given the importance of alternative sources of finance to accelerate the expansion of joint premises schemes we have acknowledged the need to consider alternative models of delivery (including PPP) to secure the required investment for integrated solutions targeted on the specific needs of local communities.
11.42 The other models for delivering joint premises development are considered in Part 6 of this report.
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