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 15 August 2008   Latest News
       

 
No lease on hospital —but paying rent

NHS TAYSIDE is paying rent on the new Pitlochry hospital without having a lease on the property.

Just days before Scottish Health Secretary Nicola Sturgeon arrives in the Perthshire town to formally open the hospital development, it emerged yesterday that the health authority’s own auditors have expressed concerns about the lack of a lease agreement.

Patients and staff moved into the multi-million pound development in March and NHS Tayside is paying a private company over £300,000 a year in rent.

But six months after occupying the building, NHS Tayside still has not signed a formal lease.

Exact measurements of the building are still awaited and, the auditors state, that may affect the payments made.

Lack of a lease is also hampering arrangements for the social work department of Perth and Kinross Council to occupy some of the accommodation on the Pitlochry site.

A paper before NHS Tayside’s audit committee meeting in King’s Cross Hospital, Dundee, yesterday laid out the auditors’ concerns.

The internal audit service report states, “We understand that rooms within the hospital are still being measured with a view to agreeing the final lease amount based on space occupied.

“We are concerned that the building was opened and occupied without NHS Tayside having formally agreed the space allocation for the building and therefore the final lease amount.”

The auditors point out that under the rules governing property transactions drawn up by the Scottish Government Health Department, there is not a requirement for a lease to be signed prior to occupation.

However, the auditors go on to state that “good practice would suggest that this should have happened.”

Ed McIntosh, NHS Tayside’s head of estates, acknowledged the auditors were concerned there was no lease.

But he pointed out that there was a development agreement signed at the start of the Pitlochry project by the health authority’s chief executive.

He explained that a lease could not be drawn up from a plan of a building because the eventual measurements of the building may be different from the plan.

“The building must be built before you have all the final figures to put in to the lease agreement because the building may be built slightly differently to what was originally on the design plan.

“As far as we can see, at this point in time, the figures are almost identical.”

He added that should there be any variation, the rental payments would have to be adjusted.

Mr McIntosh believed that the health authority was “just about there” in agreeing the lease.

Murray Petrie, NHS Tayside vice-chairman and a chartered surveyor, said that long periods without a lease were not uncommon outwith the public sector.

“In the real world, the commercial world, it is not unusual,” said Mr Petrie.

“I have seen leases signed four years after people have moved into the property.”

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