Public Sector in Real Estate
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At Deloitte we promote all aspects of diversity, and aspire to grow a work environment that is truly inclusive and reflective of our broader society. In support of this working goal, Maggie and Christy from the London Planning team talk about their roles in championing Black, Asian and Minority Ethnic (BAME) representation across the wider Financial Advisory service line and Real Estate business unit respectively.
The NHS is transforming how it delivers its services, but one key aspect to enabling this is the need for significant investment in its Estate. According to Sir Robert Naylor’s report last year, the NHS Estate ranges from world class to poorly utilised and not fit for purpose.1 Moreover, Sir Robert estimated that capital requirements could amount to around £10bn. This investment cannot be delivered through public sector funding alone. However, the Chancellor’s announcement in Budget 2018 that there will be no more Private Finance Initiative (PFI)/Private Finance 2 (PF2) Projects, this cuts off a historically well used option for enabling capital investment in the NHS.2 So what next? There are a myriad of potential solutions, and it will require a combination of traditional and innovative approaches to ensure Estates play their part in the transformation of the NHS.
With MIPIM now in full swing, what is already clearly evident is the strong appetite for international investment in major cities across the North West.
Having just taken over as the leader of Deloitte’s UK Local Public sector business MIPIM 2017 presented a golden opportunity to undertake a serious city health check. Deloitte employ around 6000 people across our 17 UK offices outside London and we have ambitions to grow this figure at least another 2000 by 2020. Clearly each of the Cities exhibiting at MIPIM this week have been keen to establish their credentials in the uber competitive inward investment market – so had did they fair?
In publishing "A City for all Londoners" the Mayor of London has reaffirmed many of his manifesto pledges (https://www.london.gov.uk/sites/default/files/cfal_oct_2016_fa_rev1.pdf). The document, known in GLA circles as "Towards a London Plan", acts as a prospectus for how to deliver the Mayor's pro-development vision for meeting London's ever growing housing, economic and infrastructure needs, while protecting the things that Londoners value and trying to meet as much of the city's growth demands within London itself.
As we enter the second half of this decade of austerity, the UK’s public sector leaders have an opportunity to decide how to innovatively deliver the savings demanded of them whilst also ensuring their services remain relevant in the digital age.
In Greater Manchester, despite solid progress being made on the regeneration agenda, housing supply has stubbornly lagged behind forecast need. Greater Manchester, is now setting itself the challenge of building over 10,000 new homes per annum. It currently is only manages 4,000. Whilst this might not be described as a crisis – it is certainly a major issue.
The Local Government sector is going through another period of rapid evolution. The next five years will see even greater cuts to local government funding, consequently the sector is looking for ever more innovative ways to fund capital and revenue programmes.
Deloitte’s State of the State report, in its third edition, is now established as an important independent overview of UK public sector finances. The deficit reduction programme that began in 2010 is now at the halfway point, but harder decisions lie ahead, and real estate will play a full role in achieving the further required savings.