Procedures Section 1 : Overview

1.3 The aim of the Procedures is to ensure that NHSScotland buys, sells, leases or excambs property at a price and on other conditions which are the best obtainable for the public interest at that time. It is essential that Holding Bodies are able to demonstrate publicly if need be that this aim has been achieved in every case.

1.4 Frequently an alternative course of action is available – even if it is only “do nothing” – in any property transaction. In that event the transaction must be subject to an appraisal of options. This applies particularly where property is to be acquired by purchase or lease but it is also relevant in circumstances where a disposal is other than to the highest bidder on the open market, e.g. health related sale. See also Option Appraisal requirements at Management Section 3.

1.5 It is important that transactions are carried out diligently and Holding Bodies must ensure that adequate staff and other resources are available for each project. Delay can involve the loss of the opportunity to buy or sell a particular property and, in the case of disposals, means that resources which could be used for another purpose are tied up unnecessarily in property. It is most important to ensure that the outcome is the best obtainable for the public interest at that time.

1.6 Achievement of the aims depends crucially on obtaining appropriate professional advice. Many property transactions are complex, and (internal and/ or external) expert advice must be sought in all cases. The respective responsibilities of professional advisers are detailed paragraph 1.6 to 1.15 of Management.

1.7 A mandatory requirement for all transactions is the appointment of a Property Adviser unless other arrangements have been agreed with SGHSC. The Property Adviser is the professionally qualified external adviser appointed by the Holding Body to assume overall responsibility for advising on the non-legal aspects of a transaction.

1.8 Who is appointed Property Adviser depends on the type of transaction – and in particular on the pre-eminent skills required for the transactions. In the case of a standard disposal, the Property Adviser will normally be the marketing agent. For acquisitions, the Property Adviser may be the District Valuer, who has considerable experience in this area, or a private sector professionally qualified firm. Where transfer between NHSScotland and another interest of Scottish Ministers following a trawl is involved, the District Valuer or a suitably qualified external valuer should always assess the transfer price and in these cases the Property Adviser would be the District Valuer or external valuer. In certain circumstances it may be necessary to appoint separate Property Advisers including a Planning adviser for different stages of transactions.

1.9 The Holding Body should therefore decide what type of professional adviser should be appointed as Property Adviser. All external professional advisers, including Property Advisers, Independent Valuers and other valuers or consultants if engaged, should be appointed by competitive tender unless there are convincing and justifiable reasons to the contrary.

1.10 For certain disposals (see paragraph 1.7 of Management), an Independent Valuer must be appointed in addition to a Property Adviser. The Independent Valuer can be a District Valuer, or a suitably qualified private sector valuer, otherwise unconnected with the disposal, appointed by competitive tender (as above 1.9). The Independent Valuer is an additional source of advice, not a substitute for the Property Adviser, who must be appointed for every transaction. Paragraph 1.8 of Management identifies the Independent Valuers’ main responsibilities, in addition the Holding Body should consider what additional services from the Independent Valuer would assist the taxpayers’ interests in the particular transaction. These will vary depending on the transaction but may include:

• involving the Independent Valuer in regular project group meetings;
• ensuring the Independent Valuer approves each stage in negotiations (to avoid the risk of a difference of opinion when it may be too late to resolve).

1.11 Where any Holding Body is in doubt as to an appropriate Property Adviser, Independent Valuer or any other professional adviser, advice is available from SG Property Division (see paragraph 1.9 of Management). Holding bodies should consult the Legal Adviser at all appropriate stages of a property transaction, and generally keep all advisers up-to-date with progress at other times. Further guidance on the use of professional advisers is given in the individual sections dealing with particular types of transactions.

1.12 The formal recommendation of each of the Property Adviser and Independent Valuer (when appointed) must be obtained in writing before conclusion of a binding contractual commitment by the Holding Body in every transaction (unless alternative arrangements have been agreed with SGHSC). This includes advice on the normal valuation aspects, purchase and sale prices, planning aspects, lease terms and completion of transactions. The Property Adviser’s agreement should be sought for the terms of a proposed lease in every case. Where notification of a transaction to the Accountable Officer is required, the notification should include the Property Adviser’s advice and recommendation and that of the Independent Valuer (when appointed) (see Annex I). Where a Holding Body proposes to act contrary to the Property Adviser’s advice, where this is related to mandatory responsibilities, this must be recorded in the Certificate (see Annex III).

1.13 After any notification of a transaction to the Accountable Officer, the responsibility for implementation of any action requested rests with the Holding Body concerned.

1.14 Holding Bodies are free to conclude property transactions within their remit without reference to SGHSC unless notification to the Accountable Officer is required in the specific circumstances listed at Annex I.

1.15 Whether or not notification is required in terms of Annex I, all Holding Bodies must inform SGHSC of any transactions which might:

• lead to Ministerial interest or be brought to the attention of Scottish Ministers;
• give rise to judicial proceedings;
• inspire suggestions of conflict between Scottish Ministers NHSScotland interests and their other responsibilities e.g. for appeals under planning procedures; or
• be otherwise novel or contentious.

In these circumstances Holding Bodies should, as soon as they are aware of such interests, provide SGHSC with briefing and advice which can be used in dealing with any questions or issues raised and await authorisation to proceed.

1.16 Where notification to the Accountable Officer is required for any property transaction issue, the Holding Body must provide all the necessary certification and supporting information when the case is submitted to SGHSC. The procedures and forms for notifying the Accountable Officer are described at Annex II. Submissions must be based on specific recommendations from the Holding Body’s Chief Executive.

1.17 All Holding Bodies must complete certification for all property transactions as set out at Annex III.

1.18 Certification should be signed at the point where an offer is to be accepted or submitted or, in the case of transactions which require to be notified to the Accountable Officer, signed certification should be, where appropriate, supplied with the other papers submitted.

1.19 Holding Bodies’ handling of property transactions is subject to certification, to monitoring following completion of the transaction and the submission of an annual post-transactions report to SGHSC. The monitoring arrangements are explained at Section 6: Post-transaction Monitoring of Management.

1.20 Holding Bodies are responsible for granting all wayleaves and servitudes in connection with NHSScotland land. Applications received by any Holding Body for such a right should be examined to ensure that the development or a site will not be adversely affected (e.g. by a wayleave to lay pipes across a piece of land on which an extension to a hospital might be built). The Legal Adviser should be consulted about proposals (as should the Property Adviser where necessary) as to appropriate terms. Any document associated with a transaction should be drawn up by the Legal Adviser and executed by a duly authorised officer of the Holding Body.

1.21 The provisions set in Paragraph 1.20 above apply. However, Holding Bodies must be aware that the statutory Telecommunications Code can result in security of tenure for certain equipment regardless of the contract terms as to duration. The implications of this require to be taken into account prior to agreeing to the arrangement

1.22 Holding Bodies should consult Health Facilities Scotland for technical advice regarding any concerns over the health implications of telecommunications equipment.