HEALTH bosses have vowed that a court ruling will not impact a long-delayed Ayrshire facility, despite losing a legal battle against VAT payments for construction materials.
The National Secure Inpatient Service, named Foxgrove, is being built next to the Woodland View site at Ayrshire Central Hospital in Irvine.
It will provide inpatient care for children aged 12 to 18 who have complex difficulties and require a high level of support.
Building work at the site began almost five years ago - in December 2021 - with an expected official opening date of September 2023.
But defects were identified in the construction and there's still no new opening date scheduled.
Now, the health board has lost an appeal against paying VAT on material used in the bedroom wing's construction after a hearing in Edinburgh.
The Upper Tribunal (Tax and Chancery Chamber) ruled last week that supplies made to NHS Ayrshire and Arran in the course of construction were liable for VAT.
The health board had appealed after the First-Tier Tax Chamber (FTT) ruled against it last year.
But Judges Ashley Greenbank and Phyllis Ramshaw sided with His Majesty's Revenue and Customs (HMRC).
An NHS spokesperson told Ayrshire Weekly Press that the decision would not add to the board's already considerable financial pressures - and said it had no bearing on the delays to the opening of Foxgrove.
The bedroom wing is set to contain 12 bedrooms with en‑suite bathrooms, two social areas or lounges, an external courtyard, plus bathrooms and linen cupboards.
During both hearings, the NHS board's legal team argued that construction materials used should be VAT-exempt because of a provision which allows for zero-rating of supplies in the construction of buildings intended for use for a “relevant residential purpose”.
The first tribunal stated: "We do not accept that psychological intervention and therapy ceases at the entrances to the bedroom wing."
And in an 18-page ruling, the appeal judges backed the original findings, concluding: "We find no material error of law in the FTT decision of the kind described. We dismiss these grounds of appeal."
North Ayrshire Health and Social Care Partnership director Caroline Cameron said: "NHS Ayrshire and Arran remain committed to the opening of the much-needed national facility, which will be of huge benefit to children from around the country who are seriously unwell, with their care and support delivered in a modern, purpose-built specialist facility.
"NHS Ayrshire and Arran notes the Upper Tribunal's decision in relation to the VAT treatment of part of the Foxgrove development.
"The case related to the VAT treatment of a specific element of the construction of the National Secure Adolescent Inpatient Service at Foxgrove. The board is reviewing the tribunal's decision with its specialist advisers to understand the implications of the judgement."
She added: "Foxgrove is a nationally funded service being delivered by NHS Ayrshire and Arran on behalf of the Scottish Government.
"The funding provided for the project included provision for VAT where applicable. As a result, the tribunal's decision does not create an additional financial pressure for NHS Ayrshire and Arran, nor has it affected delivery of the project.
"Unfortunately, with ongoing building delays, the projected opening date has moved over time.
"The contractor continues to focus on addressing a number of defects in the building, all of which require to be resolved before the building is handed over to the board.
"We continue to work with the contractor to ensure the specification for the building meets the high quality and standards required and look forward to the opening of Foxgrove."
Share