A major effort is now needed to bring hospitals and other buildings up to standard

Sir John Bourn, Auditor General

And, it concludes, up to £25m could be saved if managers were more effective at using hospitals and other NHS facilities - a fifth of the estate is under-used and 3% lies empty.

But Auditor General Sir John Bourn said while the management of buildings had been neglected, the dilpidation posed no risk to patients or staff.

The buildings referred to in the report as dangerously below standards were in fact disused.

'Cause for concern'

The NHS in Wales owns around 900 properties, worth around £1.2bn.

However, Sir John is expected to tell the Welsh Assembly on Wednesday that the state of NHS estate in Wales is a "cause for concern".

NHS Trusts have argued £300m needs to be spent to bring old buildings up to scratch.

Top of the areas needing attention, Gwent NHS Trust has said it needs £83m, while Cardiff and Vale has estimated £70m is required.

Management neglected

"Managing the estate is a vital, and previously neglected aspect of running the NHS in Wales," said Sir John.

"A major effort is now needed to bring hospitals and other buildings up to standard.

"And I would expect substantial savings to be made through making better use of all property assets."

His team also found incomplete estate management guidance has been provided to trusts.

But the report did recognise that there is a more strategic approach on the way from the NHS Directorate - assembly civil servants in charge of the health service.

And new management arrangements due in April 2002 satisfied the auditor that things should improve.

The report by Sir John comes eight month after he spoke of his "serious concern" at the financial health of the NHS in Wales, which he found was £5m in the red.

The assembly is now due to consider the report's findings in Cardiff on 24 January.