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'Sneaky' changes in GMS Premises Cost Directions

If you have a spare moment or two and you want to find out how the funding of GP premises works, the GMS Premises Cost Directions 2013 make interesting reading.

It covers all forms of reimbursement, for those GPs to pay rent and those who own their own surgery.

Up to now the 2004 directions have been in force but the new 2013 directions have been issued and there are some sneaky changes.

In the good old days, if you built a new surgery or extended your surgery and were able to get a grant or use savings to fund the project, you could also apply for an increase in the notional rent.

The 2004 directions changed this, and para 43 stated that the full extra notional rent could not be paid until a period of 10 years had passed. Looking at para 43 in the 2013 directions, this is amended to say that if the project cost less than £100,000 you only have to wait five years before the extra rent is payable, if the cost is between £100,000 and £250,000 the 10 -year period continues, however if the cost is more than £250,000, the period extends from 10 to 15 years.

Surely this is a matter of principle. If you have had funding from elsewhere, how can the entitlement to extra rent depend on how much finance you received? A GP spending £240,000 would probably expect extra rent of around £12,000 per annum and over a 15- year period will receive £60,000. Another GP spending £260,000 might expect to receive extra rental of £13,000 but over 15 years will receive nothing. That hardly seems fair –but fairness seems to be more obtuse these days.

Presumably this will affect how much practices spend on their developments – the extra £20,000 that the GP spent in the above example actually cost an additional £60,000!

There are a couple of other important but less interesting issues. If a GP gets a loan to fund a surgery development, the period of the loan must not exceed 25 years or the entitlement to rent reimbursement will be lost. This is a new but odd change.

The final oddity is the prohibition on funding any part of projects that are designed to reduce the environmental impact of the premises such as solar energy, replacement windows – you would think this should be encouraged.

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