The NHS is operating under immense strain. Crumbling infrastructure, record-high waiting lists, and mounting pressure on staff have all become defining challenges. With some facilities dating back to the mid-20th century, many are no longer fit-for-purpose, while soaring energy costs, safety concerns, and growing maintenance backlogs compound the problem.
Meanwhile, demand for services continues to rise. An ageing population, increasingly complex care needs, and regional health inequalities have intensified the need for modern, flexible healthcare environments.
The latest NHS spending review could be a turning point. With a 3 per cent annual funding uplift and up to £10 bn earmarked for digital transformation by 2028/29, there’s now a rare opportunity to upgrade the healthcare estate at scale. With more money comes more projects — and with more projects comes significantly more risk.
This raises a pressing question: with more money flowing into the system, does the NHS have the capability and governance to deliver new-builds and refurbishments that are timely, efficient and future-ready?
From routine upgrades to full hospital redevelopments, healthcare construction is uniquely complex — with high risks and high stakes. Therefore, effective contract management isn’t a nice-to-have; it’s mission critical.
To deliver value from this investment, the NHS must urgently address long-standing issues in procurement and governance. That means adopting robust frameworks, strengthening contract management and embracing digital tools that support transparency and timely decision-making.
Healthcare construction is not like other sectors
Delivering construction projects in a healthcare setting comes with unique challenges. These are not just brick-and-mortar builds. They are live, operational environments where staff continue delivering frontline care while sites are refurbished, extended or entirely redeveloped around them.
The pressure is immense. There’s the complexity of design and equipment, a diverse mix of stakeholders and strict regulatory frameworks — all underpinned by the fact that these projects are funded with public money. Every decision is scrutinised. Every delay has clinical implications, and every penny spent must be justified.
This complexity is only heightened by the growing demand for faster delivery. With an ageing population and rising pressure on the NHS estate, Trusts are under intense pressure to upgrade old infrastructure while maintaining service capacity. In this context, poor contract management doesn’t just waste money, it undermines the future resilience of the healthcare system.
The root of most delays lies in scope and change
One of the most common reasons NHS construction projects stall or go over budget is scope. A well-meaning request from a clinical team late in the process, an estates team overstretched and unable to provide timely input, or unclear governance around who signs off on change — all of these factors can derail even the best-intentioned build.
Once a change is made, the downstream implications are rarely minor. Delays in materials, workforce reallocation, and programme disruption all begin to snowball, especially when managed via spreadsheets or disconnected systems that fail to flag issues in time.
That’s where proactive, structured contract management delivers. Projects need clear scopes and well-defined decision pathways to track and manage change in real time. Without these, early warning signs are missed, and by the time problems surface, they’re often too late to fix without major disruption.
The Procurement Act, combined with the wider digital transformation agenda, signals a clear shift in government expectations around how public money is spent. Capital build projects — particularly in politically sensitive sectors like healthcare — are now expected to demonstrate value, transparency, and governance at every stage.
This has profound implications for how NHS Trusts manage construction. It’s no longer enough to award a contract and hope for the best. Clients need a clear audit trail of every decision. They need real-time visibility of project performance. They need the systems in place to demonstrate that risks are being managed, and money is being spent appropriately.
For too long, healthcare construction has relied on reactive contract management. That era is over. In its place, we need a new standard of proactive, data-driven governance.
Why frameworks matter more than ever
The NHS doesn’t start from scratch with every construction project. It uses frameworks like ProCure23 (P23) to streamline procurement and ensure consistency. These frameworks bring approved contractors and consultants into a trusted supply chain, reducing the time and complexity involved in project set-up.
Central to P23 is the use of the New Engineering Contract (NEC), which promotes collaboration, early issue resolution and shared risk. NEC contracts are built on the principle of mutual trust and cooperation — making them ideal for the type of high-pressure, interdependent projects the NHS delivers.
JCT contracts are still used occasionally — typically on lower-risk, more standardised builds — but the trend is clear: NEC is the preferred model for most major NHS infrastructure work. When used properly, it delivers results.
The NEC contract is designed to improve performance by embedding accountability throughout the life of a project. Key features like early warning systems, programme submission cycles and defined communication processes help keep projects on track and encourage collaboration between Trusts and contractors.
Yet NEC is also complex. Without the right training, NHS teams can struggle to understand its mechanisms — and when that happens, the contract becomes little more than an expensive piece of paper.
The real value of NEC comes when it’s used as a live management tool, not a static document. That means ensuring all parties understand their roles and responsibilities, tracking compensation events in real time and using the contract to guide decision-making, not just to resolve disputes after the fact.
In many large-scale hospital builds, it’s not unusual to see hundreds of compensation events logged over the life of the project. Each of these represents a potential shift in scope, cost or delivery. Left unmanaged, they become a major administrative burden — especially when tracked manually.
Enter digital contract management platforms, which have become an indispensable fire hose against that administrative burden and disjointed communication. They offer a single source of truth for all parties, flag early warnings automatically, and ensure decisions are recorded with time-stamped audit trails. These systems don’t just reduce admin; they de-risk the entire project.
They’re also perfectly aligned with the aims of the NHS’s digital investment strategy — which is not just about patient care, but about making back-office systems smarter, faster and more accountable.
Technology can’t fix culture, but it can enable better behaviours. One of the most damaging dynamics in healthcare construction is the gap between contractors and clients. Contractors often have deep expertise in NEC contract management; Trusts often don’t. This creates imbalances, tensions and, at times, missed opportunities.
Where digital systems are introduced alongside a commitment to training and collaboration, we see much stronger outcomes. Trusts become more confident decision-makers, contractors feel more supported and less exposed, and project governance improves across the board.
It’s also worth noting that software isn’t just about ticking boxes. The best systems act like referees, they ensure everyone is playing by the rules, that decisions are made fairly and that there’s no ambiguity about what was said, when or by whom.
This is especially important in a sector where public scrutiny is high, and the stakes are even higher.
Collaboration must become the default
Across the public sector, we are seeing a shift away from adversarial procurement models toward more collaborative ways of working. This is long overdue. In healthcare especially, where the focus must always remain on patient care, a collaborative supply chain is essential.
The NEC framework supports this by design, but it requires effort to embed. Trusts need to create space for dialogue, empower contractors to raise early warnings without fear and use data to drive decisions rather than opinions.
That’s where software tools offer true accuracy. They provide transparency, remove ambiguity and help maintain focus on outcomes rather than blame. When everyone can see the same data, conversations become less about interpretation and more about action.
This is a moment of opportunity for the NHS. With new funding, political support and a clear mandate for digital transformation, we have the chance to reset how we deliver capital projects.
Yet we must be honest about the challenges. Scope change, limited in-house expertise, inconsistent use of frameworks and reactive management have all held back progress in the past. If we’re to build better, we need to change not just our tools, but our mindset.
So, there should be focus on investing in training, embedding digital systems and fostering a culture of collaboration. It means seeing contracts as live management tools, not just legal fallbacks. It means ensuring that every decision made on a project is transparent, auditable and aligned with the goals of the wider healthcare system.
A supporting role for digital tools
Sypro’s platform has been developed in close collaboration with NHS Trusts, contractors and framework providers to meet the specific challenges of healthcare construction. From programme management and early warning tracking, to audit trails and performance dashboards, it enables contract teams to work efficiently, transparently and in alignment with requirements.
It has already been used to support some of the NHS’s projects, including The Christie and the creation of Nightingale hospitals during the pandemic. Tools like Sypro can support better delivery, but it is up to project teams to drive that culture forward.
The NHS is entering a new phase of estate development. With fresh investment and a national focus on infrastructure, there is a clear opportunity to improve how capital projects are delivered. Opportunity alone is not enough.
If this investment is to have lasting impact, Trusts must prioritise robust contract management, invest in the tools and training that support it, and foster a culture where collaboration and transparency are not just encouraged but expected.
By combining the right frameworks, the right systems and the right mindset, we can build an NHS estate that is fit for the future and deliver the healthcare environments that patients and staff deserve.