Management Section 5 : Income Generation

5.1 Income generation is intended to benefit NHSScotland by generating additional funds to enhance and improve patient care. Circular SHHD/DGM(1989)66, along with NHS Circular GEN(1993)15, MEL(2000)13 and HDL(2005)59, embody the current SGHSC guidance on income generation schemes.

Private Finance

5.2 Any income generation scheme which involves an element of PPP within a proposed property transaction should be considered in the light of the guidance at Management: Section 4.

Consultations with SGHSC

5.3 SG Directorate for Finance, eHealth and Pharmaceuticals has the policy remit for income generation matters. This arrangement should not be confused with the need for Holding Bodies to notify the Accountable Officer of certain property transactions in terms of Annex I. Where notification to the Accountable Officer is necessary for a property transaction within an income generation scheme, Holding Bodies should have regard to the guidance set out in Management: Section 3 and Section 4, and in Procedures, including that relating to the need to undertake option appraisals.

Holding Bodies’ Powers

5.4 Section 7 (1) of the Health and Medicines Act 1988 (the 1988 Act) as amended by the 1990 Act, allows the Scottish Ministers, and by direction Health Boards, to (i) use NHSScotland property to develop commercial opportunities not directly related to health care, and (ii) acquire land by agreement and manage and deal with land. Reference SHHD/DGM (1989)66.

Section 7 (1) provides greater flexibility for property transactions. It also makes possible (subject to necessary controls) the more profitable forms of property transaction which are available to private sector landowners but all such property transactions must be fully appraised and give definable and well-judged benefits compared to alternative means of property disposal. Highly speculative activities (e.g. direct commercial developments or speculating in property investment and land dealing markets) will not be permitted – nor, normally, will the commercial development of land for private sector housing.

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