Part A: GP Premises Overview
1.1. The Scottish Government recognises that there is pressure on the sustainability of general practice which is linked to liabilities arising from GP contractors’ premises. Around two-thirds of GP premises are either owned by GPs or leased by them from third parties. GP contractors receive financial assistance from their Health Boards towards the cost of these premises. In recent years, there has been an increase in the number of GP contractors who have asked their Health Boards to help with liabilities connected to their premises.
1.2. In November 2016, the GP Premises Short-Life Working Group, composed of representatives of the Scottish Government, the BMA and Health Boards, recommended that the Scottish Government recognise and support a long-term shift to gradually move general practice towards a service model which does not entail GPs owning their practice premises.
1.3. The Short-Life Working Group also recommended that “the Scottish Government produce a national Code of Practice for GP premises on the actions to be taken by a Board where a contractor wishes the Board to acquire property or take on some or all of the contractor’s responsibilities under an existing lease.” This Code has been prepared in response to these two recommendations.
1.4. This Code of Practice sets out the Scottish Government’s plan to facilitate the shift to a model which does not entail GPs providing their practice premises. The Code sets out:
- how the Scottish Government and Health Boards will enable the transition over a 25 year period to a model where GP contractors no longer own their premises;
- how the Scottish Government and Health Boards will support GPs who own their premises during the transition to the new model through the provision of interest-free secured loans; and
- the actions that GP contractors who no longer wish to lease their premises from private landlords must take to allow Health Boards to take on that responsibility.
1.5. The balance of GP premises’ ownership is likely to gradually shift from GPs to Health Boards of its own accord with or without positive intervention from the Scottish Government. This code is designed to facilitate this movement in a sustainable and affordable way.
1.6. The Scottish Government is creating a fund, the GP Premises Sustainability Fund, to support the measures outlined in this Code. The Scottish Government will commit £30 million of additional support with GP premises by the end of this Parliament through this Fund.
1.7. Revised Premises Directions will be issued by the Scottish Government following the vote by GPs on the new GMS contract in order to implement the measures set out in this Code.
2. About This Code
The structure of the Code
2.1. The Code is divided into three sections.
- Part A provides guidance on matters which apply to GP Premises generally.
- Part B provides guidance in relation to GP owned premises.
- Part C provides guidance in relation to premises which are leased by GP practices from private landlords.
The preparation of the Code
2.2. This Code has been prepared with the assistance and agreement of representatives of the BMA’s Scottish General Practitioner Committee, Health Boards, HSCPs and the Scottish Government.
The following principles should inform the actions taken by HSCPs, Health Boards and GP practices in relation to GP premises.
Principles for Health Boards and HSCPs to follow
A. Health Boards and HSCPs should:
- have regard to their statutory duty to provide or secure the provision of primary medical services in their area;
- have regard to the needs of the population in their areas;
- have regard to their budgets;
- consider whether assistance is an efficient and effective use of their resources;
- have regard to their HSCP’s plans for primary care;
- share their plans with practices through the local consultative bodies; and
- have regard to the level of co-operation and information they receive from GP contractors.
Principles for GP Contractors to follow
B. GP contractors should
- have regard to their contractual duties to ensure that their premises are suitable for the delivery of primary care services and sufficient to meet the reasonable needs of their patients;
- have regard to their statutory obligations regarding their premises;
- act in a transparent manner;
- provide all relevant information to their Health Boards and HSCPs in a timely manner;
- give sufficient notice to their HSCPs and Health Boards of a need for assistance; and
- fully co-operate with their Health Boards and HSCPs.
Property Asset Management Strategies
4.1. All Health Boards already have to prepare a Property and Asset Management Strategy that seeks to match clinical and operational need with the physical infrastructure required to meet that need. Property and Asset Management Strategies have generally only covered premises which were owned or occupied by the Health Board and have not, in the past, included premises which were owned by GPs or leased by GPs from private landlords.
4.2. All Health Boards must now include GP owned premises and premises leased by GPs from private landlords in their Property and Asset Management Strategies. Health Boards, in conjunction with HSCPs, must take an active approach to the management of the whole of their GP estate. The sections below identify ways that should be done.
Priorities for investment in primary care premises
4.3. HSCPs and Health Boards must work together to identify their priorities for investment in primary care premises. Their priorities for investment must support HSCPs’ primary care improvement plans.
4.4. HSCPs must take into account the needs of their population, the need to sustain general practice and, working with Health Boards, address the need to provide fit for purpose premises for the provision of primary medical services when they identify their priorities for investment in primary care premises.
4.5. HSCPs, in conjunction with Health Boards, must consult their Area Medical Committees (in practice this is expected to be the GP Sub-Committee) when they identify their priorities for investment.
The need for regular surveys
4.6. The Scottish Government is commissioning a survey of all GP premises, whether owned by Health Boards, GPs or third parties, so as to better understand the GP estate and to help plan for the future. The GP estate will need to be surveyed at regular intervals in future in line with existing obligations on Health Boards such as that of CEL 35(2010). Health Boards and GP contractors should co-operate with the survey being commissioned now and with future surveys.
4.7. GP contractors will continue to have the obligation under their contracts to allow persons authorised in writing by their Health Board to enter and inspect the practice premises at any reasonable time  . Such inspections are necessary to assist GPs to manage their premises and to allow Health Boards to manage the primary care estate better.
4.8. Health Boards and HSCPs should use the information gathered by surveys of the GP estate to help inform their Property and Asset Management Strategies.
Using the primary care estate better
4.9. HSCPs and Health Boards should consider the potential benefits to GP sustainability of making space available in existing Health Centres for GP contractors which are not currently in publically owned facilities.
4.10. GP contractors who are offered the opportunity to relocate to existing Health Centres should consider the benefits to their long-term sustainability of doing so.
4.11. The HSCP, together with its Health Board, must consider how best to use any GP premises purchased or leased by the Health Board. Together with the GP contractor and their Area Medical Committee (in practice this is expected to be the GP Sub-Committee), they should consider whether it would be better if the GP contractor provided its services from another location and for the building vacated by the GP contractor to be used for another health or social care purpose. In such cases, the HSCP and Health Board must work together to find suitable alternative accommodation for the GP contractor.
4.12. The HSCP and Health Board should also consider whether the premises should be used for any other health and social care purposes in addition to GP services.
5. Assistance From Health Boards: General Considerations
5.1. There are a number of factors and requirements which apply whenever a GP practice wishes its Health Board to assist it with premises liabilities.
The purpose of assistance from Health Boards
5.2. The purpose of Health Boards providing assistance to GP contractors with their premises liabilities is to support HSCPs to sustain the practice and continue providing primary medical services.
5.3. The most important factor in finding a solution which results in a successful outcome for the GP contractor, the HSCP, the Health Board and patients, is time. The more notice a GP contractor can give its HSCP and its Health Board of its need for assistance due to a premises-related liability, the more likely it is that a solution can be found which protects the GP contractor and ensures that primary medical services are continuously provided.
5.4. GP contractors should give as much notice as possible to their HSCP and Health Boards of their need for assistance, and provide whatever information is needed to support HSCPs and Health Boards in their efforts to provide that assistance.
5.5. GP contractors should recognise that HSCPs and Health Boards need time to make decisions on how to help those GP contractors who need assistance.
Giving notice of termination of the GMS or PMS Contract
5.6. If the GP contractor gives notice of the termination of its contract, the likelihood of a successful outcome to any premises issue for all parties is significantly reduced. Giving notice of termination arbitrarily constrains the length of time in which a solution can be found; six months for most practices, and only three months for practices with one partner. Giving notice of termination is not an application for the practice to become a “2C practice”.  If the Health Board decides to continue the GP practice as a section 2C practice, it is under no obligation to employ the former partners or to provide support in relation to premises.
5.7. Giving notice of termination of the GMS or PMS contract makes it more likely that the Health Board will be forced to consider dispersing the patient list amongst neighbouring practices using the contractual assignment process.
5.8. The measures outlined in this Code are aimed at GP contractors who will continue to provide services under a GMS or PMS contract.
5.9. GP contractors who request assistance with premises liabilities from their Health Boards will need to be prepared to adopt an open-book policy. They must provide all relevant information to the Health Board including (but not limited to):
- partnership agreement (where applicable);
- copy of the lease (where applicable);
- details of their mortgage as requested by the Health Board (where applicable);
- copy of the premises title deeds (where applicable);
- copy of any standard security over the premises (where applicable); and
- details of what has led to the request for assistance and what steps have been taken to solve those issues.
5.10. In turn, Health Boards will fully respect the confidentiality of the information provided and will use it for no other purpose than to identify how it should provide support and assistance.
5.11. While the parties are working together to find an appropriate solution to the premises issue, all parties should respect the confidentiality and sensitivity of the discussions taking place.
Health Boards’ approach to decision making
5.12. When Health Boards are making decisions on whether to provide assistance to GP contractors with their premises liabilities, the Health Boards should, amongst other things:
- take into account the needs of patients and existing statutory responsibilities;
- work with the relevant HSCP to identify a solution that supports the appropriate provision of primary care services in that locality;
- consult with their Area Medical Committee (in practice this is expected to be the GP Sub-Committee);
- consider the effect of their decisions on neighbouring GP practices; and
- set out clear reasons for their decisions.
GMS and PMS Contracts
6.1. All GP contractors have to ensure their premises are suitable for the delivery of the services they provide and that they are sufficient to meet the reasonable needs of their patients. 
The Premises Directions
6.2. Any GP contractor who receives payments for recurring premises costs under the Premises Directions has to comply with the minimum standards set out in Schedule 1 of the Directions. Those standards include a requirement for GP contractors to maintain the premises, fittings and furniture in good repair.
6.3. Therefore, all GP contractors who receive assistance with rental costs, Notional Rent or borrowing cost payments have agreed to maintain their premises in good repair as a condition of that assistance.
Standards imposed by the general law
6.4. There are a number of standards which are imposed on GP contractors by the general law as owners and as occupiers of buildings. GP contractors are also required by their GMS or PMS contracts to comply with all relevant legislation.
6.5. All Health Boards should provide advice to their GP contractors on the property related assessments that GP contractors have to carry out by law.
Premises leased from private landlords
6.6. Most GP contractors who lease their premises privately will have an obligation in their lease to maintain the premises to a certain standard. Many commercial leases are Full Repairing and Insuring leases ( FRI) – the tenant has to maintain both the interior and exterior of the building and also insure the building. Under other leases the tenant only has to maintain the interior of the building and pays (by way of a higher rent or service charge) for the landlord to maintain the exterior and to insure the building.
6.7. The standard to which tenants have to maintain their properties varies. Some leases may require the tenant to keep the property in “good repair”. Other leases may exclude “fair wear and tear” from the repairing obligation, so that the tenant has a lower standard to meet. Differences in repairing standards are usually reflected in the rent.
6.8. It is important that GP contractors understand what their repairing obligations are under their leases.
6.9. GP contractors in leased premises should ensure they maintain their premises to the standard required by their leases.
7.1. There are different ways to value premises used as GP surgeries. Existing Use Value is the value of the premises if they are to continue to be used for a GP surgery. The Existing Use Value can be calculated by taking the figure for the Notional Rent that the Health Board pays to the GP contractor and applying an appropriate multiplier. The multiplier will change depending on different factors such as location. Existing Use Value can equate to Market Value in many instances.
7.2. Another way to value GP premises is to Market Value. Premises which can be used as residential property will often have a higher Market Value than their Existing Use Value. Premises which can only be used for non-residential purposes may have a lower Market Value than their Existing Use Value. This would be the case if there were no market for commercial property in the area and a GP surgery were not going to continue in the building.
7.3. While there are other methods of valuing property, this Code refers to bases of Market Value and Existing Use Value only.
8. The GP Premises Sustainability Fund
8.1. The Scottish Government is creating a GP Premises Sustainability Fund from 1 April 2018 to provide additional support to GP contractors who own or lease their premises. It will be used to fund GP Sustainability Loans and to ease the process of transferring responsibility for leasing premises from GPs to Health Boards.
8.2. The Fund will open to loan applications from 1 April 2018. A system of prioritisation will be put in place. It is likely that only priority applications will be considered in the first six months of the Fund. This will be reviewed on a quarterly basis.
8.3. All applications by GP contractors will be made to their Health Board in the first instance to be checked and prioritised before being passed to the Scottish Government. Funding will be awarded on a quarterly basis.
8.4. Further guidance on the application process, the system of prioritisation, and the criteria for making awards will be published in the first quarter of 2018.