The public sector estate is part of the fabric of society, from the hospitals where we’re born, the schools where we’re educated, to the neighbourhoods we call home. As stewards of the estate, leaders need to create the conditions for healthy, resilient, thriving communities.
The sector faces a funding blackhole, with the chancellor announcing a £20 billion deficit. With the prime minister warning ‘things will get worse before they get better,’ there’s an urgent need to plug productivity gaps. Property is one of the public sector’s biggest assets, but also one of its liabilities. The National Audit Office suggests improving productivity, including tackling maintenance backlogs, could release tens of billions for government priorities. The untapped opportunities are great.
Maximising value is essential. The Government Property Strategy sets out the direction of travel for a future-focused, flexible and sustainable estate. COVID-19 profoundly changed how we interact with space. While the 2-metre signs may have vanished, the pandemic left a lasting legacy on workplaces with a shift towards hybrid working. The move to digital will continue to transform how space is used, and the sector needs to be ready for changes on the horizon. Leaders must consider not only bricks and mortar but also how buildings shape workplace culture and citizen experience.
In this whitepaper, we will look at the key considerations when developing a future-looking estates strategy across the public sector, including the NHS, central government, local government, blue light and justice, education, and housing.
Cross-cutting challenges
“Efficient maintenance and improvement of existing assets is as important as getting value for money in building new infrastructure. Schools, hospitals, prisons, roads and flood defences must be adequately maintained to meet their purpose. The NAO’s recent work has highlighted the false economy of allowing maintenance backlogs to build up.”
Gareth Davies, Head of the National Audit Office
The size of the challenge should not be underestimated. The public sector must navigate several issues to maximise the value of its estate and enhance service delivery:
- Scale: The public sector estate comprises more than 300,000 buildings. The sheer size makes it complex to manage. A recent NAO report suggested that estates ‘mega projects’ need more robust governance to manage the significant risks involved.
- Lack of visibility: The government’s FM Taskforce identified problems with asset registers as a barrier to improvement. Often teams resort to unwieldy spreadsheets to store estates information. Data is stored in different places, whether that’s multiple teams in one organisation using different systems or across organisations, resulting in silos. There’s a risk that decisions on compliance and maintenance may not be based on comprehensive and accurate real-time information. Centralised data would help with strategic decision-making, enabling leaders to see a true picture of their estate and support strategic decision-making
- Efficiency: With budget constraints and growing demand, harnessing maximum value is a top priority. Yet often utilisation levels lag behind targets, resulting in inefficiency and high running costs.
- Sustainability: The UK is committed to reaching net zero by 2050. As the largest landowner in the UK, the government has a real responsibility to drive reductions in emissions and make better use of resources.
- Legacy buildings: Elements of the public sector estate are crumbling and no longer fit for purpose. Historic underinvestment has resulted in huge maintenance backlogs. Plus, reinforced autoclaved aerated concrete (RAAC) is widespread across the public sector. Urgent upgrades are needed to protect public safety.
- Social changes: COVID-19 transformed how we live, work and use spaces. Facilities management professionals need to keep up with changes to support hybrid and flexible working, as well as collaboration across organisations.
- Budget constraints: The public sector is facing significant financial hardship. Estates running costs are one of the biggest forms of spending, so leaders face additional scrutiny. Rising construction prices on top of spiralling energy costs result in a burning platform for facilities teams. There’s a need to deliver value for money and generate savings. Across the public sector, facilities management spending is significant.
Estates 2.0
“We shape our buildings; thereafter they shape us.”
Winston Churchill
While the challenges should not be underestimated, technology may hold the key to a futureproofed estate that increases efficiency and enhances experience. Several innovations could help contribute to the public sector’s strategic long-term goals and secure a brighter future.
Data-driven estate
The Government Property Strategy sets out a mission to build a skilled workforce driven by insight. Data is the missing piece of the puzzle to drive greater efficiency and enhance public and staff experiences.
Given its scale and cost, the estate is of strategic importance. Integrated Workplace Management Systems (IWMS) bring together different elements of facilities management into one solution, giving leaders a holistic picture. Automations help facilities management (FM) teams save time and reduce the burden of repetitive tasks. Plus, dashboards allow decision-makers to see the current state at a glance and generate insights for action. Strategic oversight helps leaders make better decisions today that shape the public sector of tomorrow.
Smarter buildings
The new wave of smart buildings enables a shift to predictive and proactive management. Leveraging technologies such as sensors, generative AI and real-time feedback allows FM teams to take care of buildings, seamlessly. For example, sensors monitor temperature, humidity and lighting and adjust automatically. Generative AI capabilities include natural language processing, allowing users to make adjustments with voice commands. It’s also possible to schedule maintenance at routine intervals and flag anomalies, streamlining the process and ensuring buildings are looked after.
As part of the CityVerve project, Manchester acted as a demonstrator for the Internet of Things, bringing to life the potential of this technology. Initiatives spanned from using sensors to monitor energy reduction to notifying clinicians and patients how to self-manage respiratory conditions when air quality was low.
Futureproofed estate
As ways of working continue to evolve, the public sector estate must keep pace. Post-COVID, the rapid acceleration of digital transformation asks new questions of estates teams. Flexibility should be the new watchword. Leaders must distinguish between enduring core property needs and services where future delivery may change. Close collaboration with digital colleagues is crucial to ensure joined-up planning that avoids leaving empty spaces. Interoperability is a top priority for digital transformation in estates. Enabling a holistic view of property will support teams to make better decisions based on comprehensive information.
Unlocking Efficiency
Public sector estate portfolios can be complex with ownerships, leases, and rentals to both public and private organisations. Understanding the whole picture can help decision-making about the best use of space. This opens up opportunities to connect the dots. Some areas may be chronically under-used while other teams and services may experience bursts of rapid growth. Gaining strategic oversight helps leaders make better decisions based on data rather than hearsay. This helps boost efficiency, improve utilisation and achieve better value from running costs.
Ultimately, identifying efficiencies can release surplus land and support the public sector to achieve its strategic aim of creating a ‘smaller, better and greener estate.’ The right data can build the case for surplus land release so that productivity gains can be realised.
Workplace culture
COVID-19 marked an inflection point in how we work. Hybrid working is now the new normal. But it presents both challenges and opportunities. Leaders are grappling with creating a sense of team when people are not in the office together. There are also practical considerations. Teams need collaborative spaces as well as private areas for online meetings. Estates teams will need to collate data on the use of space cross-referencing maintenance costs to make better decisions on the future use of the estate. Leveraging the Internet of Things can also improve energy efficiency. For example, lighting sensors respond to movement, allowing you to reduce running costs when areas are not in use.
Forward-thinking leaders are looking at how space affects staff experience. The Government Property Strategy calls for estates professionals to integrate this into their plans. With persistently high vacancy rates across the public sector, improving retention should be a top priority. Creating spaces that cater to different needs, such as a choice of low and high sensory environments can help to boost inclusion and enhance staff wellbeing.
Place-based
The public sector plays a vital role in place-making. Hospitals, schools and housing are at the heart of communities. The Government Property Strategy suggests that the aim is for property to contribute to broader regeneration and housing supply outcomes.
Estates directors have a unique opportunity to deliver social value. Including social value as part of the procurement criteria can help ensure that large projects benefit the wider community, whether that’s boosting employment and skills or instilling pride in place.
Sustainability
Sustainability is a top strategic priority across society. As the largest landowner, the public sector has the power to create a significant shift towards a greener, cleaner UK. Innovations like Integrated Workplace Management Systems and smart technology can help leaders make decisions that move the sector towards its net-zero targets. Decarbonisation interventions will be key.
Leaders also need to prepare for the impact of climate change, considering flooding and other unpredictable weather events as part of their planning. Factoring in the possible implications at an early stage can help the sector shift from a reactive to a proactive response.
Sector specifics
Whilst we have introduced overarching themes all public sector organisations face in creating forward-thinking estates strategies, there are also challenges unique to different segments.
NHS and Healthcare
The estate impacts not just the bottom line, but patient care. The NHS Constitution sets out the right for patients “to be cared for in a clean, safe, secure and suitable environment.” An NHS Confederation survey found that 9 in 10 leaders reported that their estate contributed to persistent backlogs.
Estate strategies must support the wider Trust clinical strategy both in terms of providing appropriate acute accommodation for patients as well as supporting care in community settings away from the acute sites. The NHS estate is large and complex. Models of ownership differ across the sector. The establishment of Integrated Care Boards provides an opportunity to get strategic oversight of estates across regional footprints. This strategic estates function must be joined up with FM teams on the ground.
Key priorities include:
- Site redevelopment to enable a future model of care delivery: Many buildings predate even the birth of the NHS and are not fit for a twenty-first-century health service. Redevelopment is needed to align with future models of care. The previous government launched an ambitious New Hospital Programme to deliver state-of-the-art faciltiess. Yet the National Audit Office report acknowledges that the programme has been beset by challenges and there are question marks over whether it will deliver.
- Using the estate optimally: Improving utilisation is essential to improve efficiency and optimise costs. The HSJ reported that the NHS wastes £90 million a year on unused space. This represents untapped value that could be channelled into clinical priorities.
- Having a safe and compliant estate: Old and deteriorating buildings may not be compliant and pose risks to patient safety. The estimated cost to clear the total backlog maintenance across the NHS is £11.6 billion. Plus, many hospitals are known to contain RAAC and be structurally unsound. The NHS Premises Assurance Model was introduced to assure the estate is safe, effective and high-quality. Yet, without adequate software to manage this, it becomes an administrative burden to the NHS team rather than a year round process for improving clinical care.
- Sustainable estate: Delivering a greener estate is a top priority. The NHS has committed to delivering net zero by 2040 for the emissions the NHS controls directly, including from buildings.
Central government
The Government Property Strategy sets the direction of travel for central government. It outlines three missions:
- Transform places and services
- Smaller, better, and greener estate
- Professional excellence and insight
A shift towards data-driven estates is a key enabler of the strategy. Better quality property data will support civil servants to make better decisions about managing the estate.
The strategy also recognises the importance of encouraging collaboration across organisations. There are opportunities to share learning and best practice, as well as benefit from economies of scale.
Generating efficiency savings is a significant driver thanks to the public service productivity ambitions. Improving utilisation rates and leasing surplus land will help to reduce waste.
The Government Property Sustainability Strategy guides departments to create a greener public estate, supporting the achievement of the Greening Government Commitments. Priorities include net-zero emissions, adaptation, natural capital, and resource efficiency. The Ministry of Defence estates strategy, for example, suggests the need to identify and respond to vulnerabilities, such as coastal sites that are prone to erosion and extreme weather events. It also recognises its responsibility to promote and protect biodiversity, including rare habitats such as the chalk grasslands in the Salisbury Plain Training Area.
Local government
As budget pressures mount, local governments face difficult choices. Funding cuts and growing demand are putting pressure on the delivery of statutory services. At the same time, raising taxes is unpalatable during the cost of living crisis. The LGA warns of a £4 billion funding gap over the next two years. It all adds up to a perfect storm.
Property is one area that could release significant efficiencies and generate revenue. Understanding the whole picture of the estate is the first step to making informed decisions. Several cash-strapped councils have recently been allowed to sell assets to pay for the delivery of services.
The One Public Estate Programme supports local partnerships to collaborate on delivering services and estates needs. Ultimately, this could release surplus land for regeneration and housing. Partnerships across the country are benefitting from the Brownfield Land Release Fund 2 for housing.
Local authorities estates are complex. Take Trafford as an example:
Managing these estates and the assets must be done centrally to ensure optimal cost efficiencies, as well as high levels of customer service. Deciding where capex investment is spent, based on anticipated revenue is what drives decision-making, positioning estates management as a strategic business partner.
Trafford Council’s estates strategy is typical of the themes across the sector. The core principles include:
- Right-sized and fit for purpose: This includes making efficient use of space, reducing wasted space, and collaborating with external partners to deliver value for money.
- Asset management focused on low cost and maximising revenue: This includes generating secure income to support other council activities as well as proactive, preventative asset management to ensure the estate is safe, compliant and delivers a positive experience.
- Investing for growth: This includes continuing to invest in income-generating properties as well as taking action to address the climate crisis through generating efficiencies.
- Transparency: This includes enhancing visibility and sharing costs with public sector partners. Community asset transfer can help communities achieve their goals while reducing costs.
Blue light and justice
The blue light and justice sector faces significant pressures. With rising demand and limited capacity, the system is under strain. The recent unrest revealed the strain on law and order.
Overcrowding in prisons is a growing issue. Recent reports revealed only 100 places remain in men’s prisons in the UK. The prime minister said that the government had to check the precise number of places available daily during the recent disorder. This has a knock-on effect on the rest of the justice system, with courts asked to delay sentencing.
In policing, productivity is a major driver. The Policing Productivity Review suggested that technology could be a productivity multiplier, helping forces to save time and money. Estate and asset data can forecast costs accurately and generate savings. It can also help make the case for releasing surplus land. The estates strategy in Merseyside, for example, suggests that selling outdated and inefficient buildings and replacing them with more cost-effective and flexible facilities can free up funds for frontline policing.
Ambulance services are still feeling the strain from the pressures of COVID. Demand has increased leading to longer wait times. All this is taking its toll on staff. Many areas of the estate are not fit for purpose and need modernisation.
The fire and rescue service has seen a decrease in the number of fires as its prevention efforts pay off. Yet it’s still important to retain fire stations in case of emergency. Forward-thinking organisations are looking at how they can co-locate and share spaces with other public and third-sector organisations, further bolstering their role in the community. Northamptonshire Police and Northamptonshire Fire and Rescue Service joined forces to develop a joined-up estates strategy. It set out an ambitious long-term vision for 2040. Rationalisation is a key principle, with the aim of sharing space with other organisations where it makes sense to deliver improved collaboration and value for money. It also marks a shift to creating more flexible open-plan style spaces and less reliance on having one desk per person.
Education
Social changes are having a huge impact on universities. Rising tuition fees combined with the cost of living crisis have created a burning platform. Some institutions are seeing declines in enrolments. Changes to immigration policies have also made it harder for overseas students with families to study in the UK. PA Consulting reported that ‘an overwhelming 90% of vice-chancellors believe the UK university sector has never faced greater threats or uncertainties.’ Given this financial instability, balancing the books is a key driver. The UCL estates strategy, for example, is closely linked to their finance strategy with a desire to get their house in order and save lease costs while reducing fragmentation.
Globalisation and artificial intelligence are reshaping the jobs market. Both universities and colleges are under pressure to adjust their curricula to align with industry needs. For example, the University of Birmingham created a state-of-the-art learning facility to encourage collaboration and interdisciplinary working in the STEM sector.
It’s not only what, but how students learn that is undergoing significant change. Online learning has become more common, with many courses offering hybrid elements. This demands new solutions from FM teams. The further and higher education sector is looking to its estate to help generate efficiencies and shape outcomes.
Housing Associations
Housing is central to the prime minister’s aim to fix the foundations of Britain. In response to the housing crisis, the new government announced plans to get Britain building again. This could mark the turning of the tide for housing associations, with new developments set to include social housing.
As the government looks to rebuild Britain, housing associations will be integral. The National Housing Business Strategy sets out ambitions for Housing Associations to play a role in place-making in the surrounding communities. The strategy also calls for a renewed focus on maintaining the quality and sustainability of the existing housing stock. This will require a shift in roles for housing associations, extending beyond box-ticking landlord responsibilities to taking a strategic view of the estate and their place in the community. Data insights will be crucial to give leaders oversight of their housing stock and corporate offices.
See the bigger picture with Concerto
Concerto is the UK’s leading CAFM and estates management system. Built by FM geeks who loved playing with Lego as a kid, the software is modular, meaning you can pick the parts of the system that best match your needs.
This means you can grow into, not out of Concerto. This is reflected in our high levels of customer retention (0 customer losses for over two years), and our dominant position in the public sector.
Winner of two PFM awards for Experts in Partnership, Concerto is trusted by clients including NHS England, HMRC, the University of Oxford, the London Fire Brigade, and many more.
The intuitive platform offers several benefits:
One-stop shop: Concerto brings everything together in one place – no searching for lease information or quotes for maintenance works – it’s all on the same intuitive system.
Secure peace of mind: Your data is hosted in the UK and the platform offers robust security, earning the trust of government organisations.
Whole lifecycle: It’s not just for building maintenance. Manage your assets throughout the lifecycle from building to disposals.
Compliance, covered: Concerto gives you peace of mind you’ve met all your statutory responsibilities.
Enhance visibility: Get total oversight of your estate with dashboards that help you see the current picture at a glance.
Intelligent forecasting: Benefit from forecasting tools to spot trends and make informed decisions about the future of your estate.
Power up performance: Monitor KPIs and SLAs including contracted work to drive up performance.
Management on-the-go: Concerto is mobile-enabled so you manage the estate while on-the-go.
More than just a platform, the Concerto team offer ongoing support to help you level up your estates management. That starts with initial training and extends to support with everyday use of software. Their dedicated in-house help desk team are available to answer any questions. That true partnership working is why they see such high retention rates and longstanding relationships, with many clients choosing to stay with Concerto and expand their systems.
Platform modules include:
Estates management
CAFM
Asset management
Project management
Intelligent workspace
Health and safety
Premises assurance
Reporting and analytics
Case study: Manchester City Council
Manchester City Council has a large and complex estate with approximately 400 operational buildings and over 2000 commercial interests. The team deals with about 12000 reactive requests a year.
A lack of visibility posed challenges for management. Staff relied on unwieldy spreadsheets to track maintenance data. Plus, data was stored in disparate places, creating barriers to teams taking ownership of issues.
Manchester City Council needed a system to house their property records data, coordinate planned preventative maintenance (PPM) and satisfy compliance requirements. Concerto’s track record with other local governments was a deciding factor in the procurement process. They wanted to work with a supplier who would understand their unique needs.
The council has a longstanding relationship with Concerto, dating back to 2011. They use several modules and have expanded their platform use over time. Concerto offers a holistic view with internal staff and external contractors using the same system with differentiated permissions.
‘Concerto has been very effective in supporting the council’s corporate landlord model. It enables us to make informed decisions on land and buildings and meet our reporting requirements, which would otherwise have been a struggle. We like the fact they are local and work effectively with the team. They’re easy to get hold of and always looking for new ways to enhance the system.’
Andrew Stirling, Head of Corporate Estates, Manchester City Council
Case study: The University of Warwick
The University of Warwick is a public research university on the outskirts of Coventry. Warwick is primarily based on a 290 ha (720 acres) campus on the outskirts of Coventry, with a satellite campus in Wellesbourne and a central London base at the Shard. Warwick Arts Centre, a multi-venue arts complex in the university’s main campus, is the largest venue of its kind in the UK outside London. The University has over 25,000 full-time students and over 6,000 members of staff.
As part of the overall estate strategy, the university wanted to centralise its data and deliver improved programme control and cost savings. With a complex estates portfolio totalling over £100m, having strategic oversight was crucial. The university selected Concerto for its flexibility and intuitive interface.
While project management was the primary driver for Concerto, the university expanded the scope to include facilities management activities, bringing everything together into one system. The university has taken advantage of the highly configurable system. The team has taken the time to understand how the system can streamline their processes and generate efficiencies, to harness the maximum benefit from the system.
The system has helped project teams to coordinate effectively, providing a single point of truth. Access is granted to project stakeholders across the university and to external consultants and contractors, enabling a joined-up approach. The university also uses the automated reports to keep track of progress and flag variations in deadlines and expenditure so issues can be managed.
The team uses the integrated document management module to store all relevant information in one place, with version control protocols so everyone is on the same page. This has been particularly helpful when team members are absent or if stakeholders need to access information out of business hours, making facilities management seamless.
From insight to implementation
Ready to level up the strategic management and futureproof your property portfolio? Get total oversight and turn insights into implementation with Concerto.
Book a demo to discover how it can give you confidence that you’re on track to deliver your strategic estates goals. Our team can share learning from other public sector customers to help you hit the ground running.
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Future directions
Decisions today shape tomorrow. Nowhere is that more true than with the estate. Its scale and strategic importance give it the power to shape the future of the public sector as a whole. Leaders must step back and see the bigger picture to benefit from untapped opportunities, plug the productivity gap and ensure sustainability. But more than that, the estate can unlock the door to the future of services. Places influence people. Modernising the estate will transform ways of working and team culture, creating future-proofed public services. The estate forms the building blocks of a better future for the public sector. With the bigger picture in mind, leaders can shape the communities they serve.
References
- BBC News. “Five Key Points from Starmer’s Speech.” https://www.bbc.co.uk/news/articles/cvgr5rnyrlqo
- The National Audit Office. “Improving Productivity Could Release Tens of Billions for Government Priorities.” https://www.nao.org.uk/insights/improving-productivity-could-release-tens-of-billions-for-government-priorities/
- Gov.uk. Government Property Strategy, 2022 – 2030. https://www.gov.uk/government/publications/government-property-strategy-2022-2030
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- Gov.uk. “The NHS Constitution for England.” https://www.gov.uk/government/publications/the-nhs-constitution-for-england/the-nhs-constitution-for-england
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- The National Audit Office. “New Hospital Programme Report.” https://www.nao.org.uk/wp-content/uploads/2023/07/New-hospital-programme-report.pdf
- NHS England. “Delivering a net zero NHS.” https://www.england.nhs.uk/greenernhs/wp-content/uploads/sites/51/2022/07/B1728-delivering-a-net-zero-nhs-july-2022.pdf
- The HSJ. “Unused Space Costs NHS 90m a Year.” https://www.hsj.co.uk/finance-and-efficiency/unused-space-costs-nhs-90m-a-year-new-figures-reveal/7037717.article
- Gov.uk. “Public Services Productivity Drive.” https://www.gov.uk/government/news/18-billion-benefits-through-public-sector-productivity-drive
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- Gov.uk. “Defence Infrastructure Organisation Estate and Sustainable Development.” https://www.gov.uk/guidance/defence-infrastructure-organisation-estate-and-sustainable-development
- Local Government Association. “Local Government Finances.” https://www.local.gov.uk/parliament/briefings-and-responses/local-government-finances-and-impact-local-communities
- BBC News. “Nineteen councils allowed to sell assets to pay for services.” https://www.bbc.co.uk/news/uk-politics-68439624
- BBC News. “Under 100 Spaces in Men’s Prisons in England and Wales.” https://www.bbc.co.uk/news/articles/c0rw48nj282o
- BBC News. “Courts Told to Delay Sentencings over Prison Space.” https://www.bbc.co.uk/news/articles/c5y586gg147o
- PA Consulting. “UK Universities Facing Unprecedented Challenges.” https://www.paconsulting.com/newsroom/uk-universities-facing-unprecedented-challenges-and-leaders-call-for-fundamental-reforms
- https://www.merseysidepcc.info/down-to-business/spending/estate-strategy-taking-the-right-steps/
- Northamptonshire Fire and Rescue and Northamptonshire Police. “Estates Strategy.” https://www.northantsfire.gov.uk/wp-content/uploads/2024/02/Estates_Strategy.pdf
- Labour. “Kickstart Economic Growth.” https://labour.org.uk/change/kickstart-economic-growth/
- UCL. “Estates Strategy.” https://www.ucl.ac.uk/strategic-plan-2022-27/supporting-strategies/ucl-estates-strategy-2022-27
- Northamptonshire Fire and Rescue Service. “Estates Strategy.” https://www.northantsfire.gov.uk/wp-content/uploads/2024/02/Estates_Strategy.pdf
- National Housing Federation. “Business Strategy 2022 – 2025.” https://www.housing.org.uk/about-us/what-do-we-do/business-strategy-2022-25/
- Concerto. “Home Page.” https://www.concerto.co.uk/
- Concerto. “Manchester City Council Case Study.” https://www.concerto.co.uk/case-studies/manchester-city-council-video-testimonial/
- Concerto. “University of Warwick Case Study.” https://www.concerto.co.uk/case-studies/the-university-of-warwick/
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