Government property: Short-termism and data gaps harm effort to tackle £49bn maintenance bill, says PAC
|
Key public services are being regularly affected by the poor
condition of some Government property and the failure to maintain
it. In a report on the condition of Government's property holdings,
the Public Accounts Committee today lays out a series of
recommendations to help government tackle its (at least) £49bn
maintenance backlog. The report finds that risks relating to the
condition of Government's extensive property holdings have now
materialised. Due to dilapidation,...Request free trial
Key public services are being regularly affected by the poor condition of some Government property and the failure to maintain it. In a report on the condition of Government's property holdings, the Public Accounts Committee today lays out a series of recommendations to help government tackle its (at least) £49bn maintenance backlog. The report finds that risks relating to the condition of Government's extensive property holdings have now materialised. Due to dilapidation, 4,100 prison cells have closed since 2010, in the context of a crisis in prison estate capacity. In the NHS, the report finds that an average of 5,400 clinical service incidents occur each year due to property and infrastructure failures, including closed departments, suspended services and cancelled appointments. The inquiry also saw concerns raised with government on the condition of the defence housing estate, with the report calling on the Ministry of Defence to lay out its plans for redeveloping its housing estate. Noting the potential for the emergence of further risks such as emergency repairs of buildings with reinforced autoclaved aerated concrete (RAAC) and asbestos, the PAC is calling for Departments to include explicit analysis of the risks across their portfolio in their maintenance plans, as well as information from central government on how Departments are being supported to minimise the risks posed by poor maintenance. On funding, the report finds that the annual basis by which Departments can bid for money for property maintenance hinders the ability to plan longer-term works. Currently, property works may be concentrated close to the end of a year to avoid losing funding, despite likely less favourable weather conditions. As well as recommending longer-term planning of maintenance, the PAC is calling for more consideration to given as standard to alternatives to maintenance which may deliver better value for money, such as moving to new buildings. The report further warns of gaps in skills and data to tackle these issues. While the property maintenance backlog reached at least £49bn at Oct '24, the true figure likely exceeds this estimate. Condition data is outdated, collected at different times, and based on various definitions. The PAC is also concerned that it may be very challenging to maintain existing property professional staff numbers and recruit more across government, in the context of attempts to reduce civil service expenditure. Noting also that government property has the lowest proportion of women working in it of any of the government functions, the report calls for a plan from government to improve skills and diversity of property professionals across government. The PAC is recommending that all departments should properly plan to spend all the capital money that they have bid for during the relevant financial year to avoid underspends. Alternatively, the Treasury should be prepared to allow this money to be rolled over into the next financial year. Sir Geoffrey Clifton-Brown MP, Chair of the Committee, said: “There is only so much that even the most diligent and committed professionals can do to maintain a high standard of service, when working in poorly maintained buildings. Our Committee has long identified running themes in our work – of poorly maintained infrastructure, short-term planning, a lack of data and a lack of skills. Our latest report on government property finds all these themes sadly alive and well, with impacts and disruption across the government's sprawling property holdings. “One of the biggest problems in government property is the defence housing estate, too much of which is made up of entirely inadequate accommodation. It was therefore welcome to hear of extra funding for forces housing as part of the Strategic Defence Review. Overcrowding, damp, problems with central heating and water systems – it is beyond unacceptable that we lack enough good condition properties for our military families. We regularly hear from this government that it aims to ‘fix the foundations' of the country. We hope the recommendations in our report help government to quite literally do just that, for those who live, work and depend on these crumbling structures. It is incumbent on government to move with the utmost alacrity to swiftly address these long-running issues.” Notes to editors The PAC's report was agreed prior to the announcement of an extra £1.5bn in funding for forces housing as part of the Strategic Defence Review. PAC report conclusions and recommendations Government efforts to tackle the backlog are undermined by inconsistent and incomplete data. The backlog of maintenance across central government property reached at least £49 billion as of October 2024, however it is likely that the true figure exceeds this estimate. Condition data collected by government departments is outdated, collected at different times, and based on various definitions. The OGP intends that all government departments use the same definition. This should enable the OGP to calculate an accurate figure for the overall backlog across government. There is a further risk that departments do not comply with OGP requirements on gathering data in a timely and consistent manner, especially considering that the OGP did not receive condition data on 36% of central government property falling within the scope of the 2022-23 State of the Estate report. There is a risk that this property is in the poorest condition. After some delays, the OGP introduced InSite, an enhanced data collection system, in April 2025 which OGP expects will improve data consistency. Recommendation 1.
The poor condition of some property and the failure to maintain it is regularly affecting the provision of key public services. Risks relating to property condition have materialised, taking property out of use and impacting functionality of properties such as prison cells, law courts, schools, hospitals, defence estate and museums. Over 4,100 cells closed due to dilapidation and an average of 5,400 clinical service incidents occur in the NHS each year due to property and infrastructure failures. These are localised incidents where the level of disruption results in the organisation temporarily or permanently losing its ability to deliver services, which can include closing departments, suspending services and cancelling appointments. The government estate is potentially at further risk from issues that have yet to emerge, like the emergency repair works that needed to be carried out to address the presence of reinforced autoclaved aerated concrete (RAAC) and asbestos across the government estate. RAAC is less durable concrete that can seriously risk the safety of buildings where it is present, whereas asbestos poses a health risk. Departments are required to prepare Strategic Asset Management Plans (SAMPs) to document their planned approach to the maintenance of their estates, as well as the management of risks. At the moment, not all plans include comprehensive risk analysis and mitigation. These plans are expected to consider future risks, and the OGP is encouraging departments to take a longer view of their portfolio in their SAMPs going forward. Recommendation 2.
Many departments' property plans lack the information necessary to manage and maintain their portfolios. Departments are required to prepare Strategic Asset Management Plans (SAMPs) to consider the totality of their assets and document their planned approach to managing maintenance and disposals in the longer term, including documenting any property risks and how they plan to manage and mitigate them. Departments' SAMPs are currently of varying quality, and different levels of maturity. The Ministry of Defence needs to urgently create a long-term strategic plan to redevelop the service personnel housing estate as part of its SAMP. Departments are also expected to include data from their arms-length-bodies (ALBs) in individual SAMPs, unless the ALB prepares a separate SAMP. Departments do not have sufficient oversight of some ALBs with large property portfolios and their information does not feed sufficiently into departmental SAMPs. The OGP requires ALBs that have a particular property focus to prepare their own SAMP, for example Homes England and the Government Property Agency. Recommendation 3.
Short-term funding for property maintenance is hindering longer-term planning. Departments typically bid for property maintenance funding on a yearly basis. This short-term funding cycle can be inefficient as it hinders departments' ability to plan longer-term maintenance works. The contracting phase may take a long time and this can mean that property maintenance works may, for example, be concentrated close to the year end to avoid losing funding, despite likely less favourable weather conditions. HM Treasury is responsible for assessing departments' bids for maintenance funding. The quality of these bids is variable and there is little clarity on whether departments consider alternatives to maintenance, such as whether moving to a new building would be better value for money in the long-term. The OGP is supporting departments through provision of guidance and tools on preparing maintenance bids, and supports HM Treasury with assessing the bids. Officials in the OGP also regularly engage with departments and ALBs on disposals. We specifically raised concerns about the delays in the disposal of the properties acquired for the abandoned High Speed 2 extension. Not all departments and ALBs make use of what the OGP offers and the OGP does not currently mandate the use of any of its tools. The government has set out plans for longer-term, five-year, capital funding cycles, which should help departments' plan better. Recommendation 4.
Many departments and arm's length bodies do not have the skills and capabilities to manage their property portfolio effectively. There is a shortage of skilled property professionals across departments. Departments are finding it difficult to recruit and retain property professionals. The lack of capacity and capability in departments impacts their ability to maintain properties effectively, including both carrying out the work required and managing contractors. Government has recently made progress in recruiting and training staff, for example by initiating 302 new property apprenticeships and 61 new graduates recruited for property roles by September 2024. We understand that the government property function has the lowest proportion of women working in it of any of the government functions; an issue acknowledged by the Cabinet Office and which it says it is trying to address. We are also concerned that it may be very challenging to maintain existing property professional staff numbers across government, and certainly to recruit more, in the context of trying to reduce civil service expenditure. The Cabinet Office has itself announced recently that it intends to reduce its staff numbers by nearly a third. Recommendation 5. As part of its of strategic workforce planning review, the Cabinet Office should set out the reasons for difficulties recruiting and retaining property professionals and its plans to improve skills and diversity of property professionals across government. The Cabinet Office's oversight of government property risks being ineffective due to duplication of roles. The OGP is responsible for the overall strategy for non-office property across government, whereas the Government Property Agency (GPA) is responsible for office related strategy. The OGP sits within the Cabinet Office and the GPA is one of the Cabinet Office's Executive Agencies, and we are not convinced of the need for two separate organisations, given both sit within the Cabinet Office departmental group. The new National Infrastructure and Service Transformation Authority, responsible for infrastructure strategy, jointly reports to the Cabinet Office and HM Treasury. Strategy implementation and operational management are split across departments and their ALBs. For example, NHS Property Services is responsible for the primary care estate (initial points of contact for patients, such as GP practices, pharmacies and dental clinics), while currently NHS England is responsible for the secondary care estate (for example, hospitals and specialist clinics). The existence of these various organisations across government risks duplication of effort and inefficiencies. Additionally, while the OGP has responsibility for overseeing property strategy, it does not have the levers to support improvements, which raises the concern that it cannot gain sufficient traction. The Cabinet Office says it is carrying out a review of its structure to remove duplication and inefficiency. Recommendation 6. The Cabinet Office should write to the Committee, as soon as practicable, to provide an update on its review of the effectiveness of its oversight of government property. The update should include any actions it is taking to strip out duplicate roles, and give specific consideration to the need for two property organisations within the Cabinet Office departmental group. |